Schools Forum / Item5
1 May 2014
Early Years Services 2015/16 – Proposed Funding
Report of the Director of Corporate Resources – Corporate Services and Director of Children’s Services
Contact: Josie Matthews, 01962 847020;
Tracey Sanders, 01962 847123,
1Summary
1.1This report sets out the case for consideration by schools forum for funding discretionary elements of the Early Years Service from April 2015. Funding from the Local Authority Block will cease as part of the Hampshire County Council budget cuts required for 2015/16. This paper sets out the significant benefits for Hampshire children and schools for continuation of this funding.
2The Local Authority’s Early Years Statutory Duties
2.1Under the Childcare Act 2006, the local authority has a number of statutory duties (see Appendix 1). These include:
Improvement of young children’s well-being. Local authorities must work with health and employment service partners to improve outcomes for young children aged 0 – 5 years and reduce inequalities between them.
Provision of childcare. An assessment of the childcare market must take place every three years and the local authority must secure sufficient childcare to meet identified needs (including free Early Years Education - EYE).
Information, advice and training to providers. Local authorities have a duty to provide information, advice and assistance to parents up until their child’s 20th birthday and provide information, advice and training to providers of childcare.
2.2The Apprenticeships, Skills, Children and Learning Act 2009 subsequently legislated for the provision of sufficient children’s centres and the Education Act 2010 legislated for the provision of a 2 year old entitlement to free EYE.
2.3New statutory guidance on the role of the local authority was issued in September 2013 and redefined the requirement to provide information, advice and training to providers of childcare. The guidance states that support should only be provided for settings that are judged to be ‘requires improvement’ or ‘inadequate’ by Ofsted rather than to all settings. The guidance does not stipulate the nature or amount of support.
2.4The Children and Families Act 2014 has repealed the local authority duty to complete a detailed childcare assessment every three years. The duty to secure childcare and to secure early year’s education provision remains.
3 The work of the local authority and outcomes
3.1 The local authority currently meets its statutory duties through the work of Services for Young Children (SfYC) local development teams. There are eight teams working within district areas and the teams include childcare development co-ordinators, business support officers, early year’s advisory teachers, children’s centre support officers and children’s centre support teachers. These staff, funded by the local authority, manage the childcare market to ensure sufficient early years education and also provide quality improvement support. The local development team also includes the Portage and Area Inclusion services which are funded through the Dedicated Schools Grant (DSG).
3.2 The teams work with a varied Early Years Education sector which currently consists of 372 pre-schools, 266 day nurseries, 466 childminders, 25 independent nurseries and 11 maintained nurseries. This varied market ensures parents in Hampshire have a good choice of provision to meet their needs.
3.3 To date, this work of the local development teams has been highly effective in securing childcare provision with Hampshire providing 3.32% of all childcare in England.The population of children aged 0-4 years in Hampshire is 78,925 which represent 2.33% of the England population of under fives. Therefore, Hampshire provides a greater proportion of the national childcare market compared to the proportion of children (September 2013).
3.4 The local development teams have had a significant impact upon the quality of provision. Ofsted judgements for provisions inspected from 1 September 2012 to August 2013 continues to show that Hampshire has good quality provision, with 78% of childminders being judged good or outstanding,which is 4% above the England average (June 2013). 83% of providers on non-domestic premises received a good or outstanding judgement, which is 1% above the national figure.
3.5 The work of the local development teams has also had a significant impact upon children’s outcomes. The Early Years Foundation Stage (EYFS) profile results in 2013 were considerably above national levels and within the top quartile of statistical neighbours this year. Table 1 demonstrates that this is part of an improving trend.
Table 1
Threshold, Good Level of Development (GLD) and Gap attainment*
Aspect
/2009
/2010
/2011
/2012
/2013 GLD
Hampshire threshold
/51%
/54.5%
/58.5%
/64%
/59%
National threshold
/52%
/56%
/59%
/64%
/52%
Hampshire Gap
/32.6%
/30%
/28.9%
/26.7%
/28.9%
National Gap
/33.9%
/32.7%
/31.4%
/30.1%
/36.6%
*Please see Appendix 1 for definitions of Threshold, GLD and Gap
3.6 In particular, there is an improving trend in children’s language and social skill development.
Table 2 - % of children achieving 6+ points in key areas of learning (2009 – 2012) or expected or greater level (2013)
2009
/2010
/2011
/2012
/2013
PSED
/74.9%
/78.5%
/80.55
/84.4%
/81.9%
CLL
/54.9%
/57.2%
/60.9%
/67.2%
/78.4%
3.7 The excellent outcomes in early years have had a significant impact upon KS1. Table 3 shows outcomes for children who have received early year’s education under the 2009 EYFS framework. Since 2009 a range of projects and support have been delivered to Early Years Education providers and schools which have contributed to greater attainment in KS1 (see Appendix 1 for details). The benefits will become evident in KS2 in 2017 and are likely to have an impact upon GCSEs in 2022.
Table 3
Key Stage 1 Results 2011 – 2013
Key Stage 1 / Level 2 + / Level 3+Measure / 2011 / 2012 / 2013 / 2011 / 2012 / 2013
Speaking/Listening / 92% / 93% / 93% / 32% / 32% / 34%
Reading / 89% / 90% / 92% / 34% / 36% / 39%
Writing / 86% / 88% / 89% / 14% / 15% / 17%
4 Future Direction of the Local Authority
4.1 In light of the policy changes and reduced funding available, the local authority has considered its statutory responsibilities and will continue to:
Ensure sufficient early years education places
Provide moderation for the Early Years Foundation Stage
Respond to ‘Inadequate’ and ‘Requires Improvement’ Ofsted outcomes
Maintain the provision of children’s centres.
4.2However, the local authority will no longer be able to fund discretionary services, which include;
- Support for early years businesses e.g. advice on governance and management
- In depth support to provision that is less than ‘good’ or provision that is at risk of a less than good judgement
- Delivery of evidence-based programmes to improve children’s outcomes in localities where these are at risk
- Provision of EYFS advice to children’s centres and facilitation of the link between the work of children’s centres and schools.
4.3 These discretionary areas of work impact upon the availability of early years education places. For example, if provision does not have robust organisational structures, it is more at risk of closure. These discretionary areas also impact upon outcomes for children and school readiness. For example, without targeted evidence-based programmes to improve children’s speech and language skills, children will enter school less ready for learning. Additionally, providers who receive less than ‘good’ Ofsted judgements need direct support to improve quality. Without this support they may not improve and children enter school less ready for learning.
5 Overall Local Authority Budget 2015/16
5.1 The local authority is planning to allocate the following funding to early years services in 2015/16, which is a reduction of approximately £6.5m (including £1.6m proposals outlined in this report – see section 6.2)
Table 4
Local Authority Early Years Funding 2015/16
Statutory duty / £mChildren’s Centres / 9.4
Sufficiency, Moderation, Outcomes / 2.0
Total / 11.4
5.2 This will fund support for providers and schools who wish to set up provision where it is needed or work with organisations when provision is at risk of closure. It will also be used to manage compliance with the Early Years Education Funding Scheme, maintain a list of approved Early Years Education providers, and implement the removal process from the EYE approved providers list, manage the cessation of funding providers with poor performance and administer claim and payment arrangements. The 2015/16 funding will also support early years provision in responding to safeguarding actions where issues arise and the local authority will also manage the serious case review process. The local authority will retain 8fte childcare development co-ordinators to complete this work.
5.3This funding will also be used to ensure that the local authority meets the outcomes duty by continuing to manage the collation and interpretation of the Early Years Foundation Stage data, moderating EYFS profile judgements and providing communications on changes to the EYFS. The local authority will provide diagnostic advice on targeted training and support programmes where children are at risk of poor outcomes, provide updates for training colleges on the latest policy development, provide an overview of the qualification profile of the sector and signpost providers to funding and training opportunities.
5.4 The local authority will ensure that it meets the outcomes duty by providing support for the design and monitoring of plans following a ‘requires improvement’ or ‘inadequate’ Ofsted judgement and will mediate peer support where provision is poor. The local authority will retain 1fte Quality Improvement Service Manager (Early Years), two early year’s advisors and 1.4fte training managers to provide this support.
5.5 Finally, the local authority proposes to continue to meet its statutory duties in relation to the delivery of children’s centres by:
- maintaining children’s centre services through 54 centres,
- providing monitoring, support and challenge to children’s centres,
- providing support during Ofsted inspections,
- providing Hampshire County Council premises and IT management,
- liaising with partners to ensure joined-up service delivery,
- co-ordinating information sharing to meet the needs of the vulnerable families,
- working with children’s centres to strengthen understanding of the take-up of Early Years Education funding and their role in promoting this to vulnerable families and providing guidance and support for the governance model.
6DSG Current Funding and Proposals for Future DSG Funding
6.1 The DSG currently funds early year’s education places for 2/3/4 year olds, 2 year old provision training and support, the Portage service, the Area Inclusion service, SEN early years training, Leading Foundation Stage Practitioners and the Keep on Talking programme The total cost of this is £60.5m (£60m Early Years Block, £0.5m High Needs).
6.2 It is proposed that Schools Forum agrees the funding from the schools budget from 2015/16 for the discretionary areas of early years support that are listed in Table 5.This would provide resources to approximately 300 early years’ providers (including childminders) from a potential sector of 2,200 providers, with work impacting upon about 22,000 children.
Table 5
Current Funding and Proposed Early Years Funding from DSG
Area / 2013/14Budget
(£000) / 2014/15
Budget
(£000) / Proposed 2015/16 DSG (£000)
Early Years Education Support / 1,400 / 708 / 500
Quality Improvement Advice / 2,159 / 2,159 / 1,143
Total / 3,559 / 2,867 / 1,643
6.3The balance of the above (£1.224m) is part of the £6.5m savings proposals outlined in section 5.
7 Types of Support Required and Alternatives
7.1 In summary, changes to policy and funding willresultin the reduction of a number of discretionary services currently delivered by SfYC. In particular these include Early Years Education support and Quality Improvement advice. These services have a significant impact upon outcomes for children and school readiness.
The following options are considered:
- Early Years discretionary services to be funded from DSG
- Early Years Education providers to buy all discretionary services
- Schools to provide services directly with some support from the local authority funded from the DSG
- Cease funding for discretionary services.
7.2 Early Years Education support consists of help to group settings to strengthen governance and leadership arrangements, help to settings and childminders to meet the welfare standards and specific support to childminders to raise the quality of early years education delivery.
7.3 There are three options :
i) Central funding to commission
ii) EYE providers pay for support
iii) Direct support from schools
7.4 The funding required for this work to continue is £500,000 to commission services or for the local authority to provide support directly. This will deliver 6 days support per provider assuming 300 providers need support.
7.5 Alternatively, it is possible that Early Years Education support could be secured through settings paying for support to strengthen their governance and leadership arrangements. This would cost approx. £250 per day with most settings requiring between 4-6 days support. The local authority could offer places on welfare standards training courses at minimal cost, e.g. pay for venue and refreshments where there are spaces.
7.6 Finally, schools may wish to provide support directly to childminders and settings themselves to raise the quality of childminding delivery and provide organisational support to settings with schools covering the costs. It is anticipated that, across the county, schools would need to deliver 1800 days of support to meet providers’ needs.
7.7Quality Improvement advice includes providing in-depth support to Early Years Foundation Stage settings and schools without ‘good’ or ‘outstanding’ Ofsted judgements, andsettings with good judgement requiring help to sustain quality of provision, evidence-based intervention programmes, e.g. Promoting Alternative Thinking Strategies, Personal Social Emotional Development and Communication Language Literacy, tracking progress programmes and the delivery of county-wide training sessions on EYFS. It also provides support to children’s centres in developing systems for assessment and monitoring of children’s progress and best EYFS practice. It provides support to children’s centres in the identification of school level EYFS trends and helps to steer children’s centre priorities to meet school needs. Finally, teachers work with staff and parents where children have been identified as at risk of poor outcomes. See appendix one.
7.8There are four options :
i) Central funding
ii) EYE providers pay for support
iii)Direct support from schools – run evidence based programmes
iv) Direct support from schools - catchment area children’s centres
7.9The funding required for this work to continue is £418,000 for 8 FTE Early Years District Advisory Teachers (reduced from 13.3 FTE) and £725,000 for 15 FTE Children’s Centre Support Teachers (reduced from 26.8 FTE). The local authority currently provides for 400 days support directly to schools through SfYC staff.
7.10Alternatively providers could pay for support themselves at £100 per place for training and £450 per day teacher support.
7.11It is possible that Quality Improvement advice could be provided by schools themselves who might offer peer monitoring to settings with less than ‘good’ Ofsted judgements. Schools could run evidence-based programmes themselves. Finally, schools with EYFS development needs could source their own support. If schools were to provide this support to settings themselves it would equate to 1560 days and a further £130,000 would be required for 2 FTE staff to oversee the schools support programme to ensure consistency of approach across the county.
7.12 Schools could also provide support to catchment area children’s centres and to linked early years settings. 54 centres would need 1 day a week of support which includes support to linked early year’s provision. Funding would be required to retain 2 Children’s Centre Support Teachers who would oversee continuing professional development for school peer mentors and this would cost £130,000.
8Could providers pay for support?
8.1It is unlikely that providers could pay for support as suggested in section 7. The average cost of a full-time member of staff is £27,000 and the Early Years Single Funding Formula (EYSFF) for 3 year olds in a setting staffed on a ratio of 1:8 only provides £19,744 pa (based on 2013/14 average EYE hourly rate). Many providers operate on a ratio of 1:6 which further reduces their income to £14,808 pa. Staffing tends to account for about 80% of income. PVI settings do not receive any additional payments through the EYSFF to cover business rates or other regulatory costs. The difference in costs is managed through the provider’s business model.For example, they may sell additional hours which provides an income. However, the recent increase in the uptake of free entitlement hours means that there is less opportunity to charge for additional time.
8.2If providers were given the funding for the discretionary services directly, it would require Schools Forum to add approximately 15 pence to the base rate. If this approach were adopted, all providers would receive uplift rather than those in need of support.
9Early Years Position 2015/16
9.1As previously stated in the Budget paper on 3 March 2014 (item 6) that was presented to schools forum, it ispossible to fund the support services and any on-going pressures from 2015/16 for 2 years using one-off funds. The table below shows the breakdown of the early years. A further update on the budget position is provided in a separate report on this agenda.
Table 6
Total Early Years Funding Required
Ongoing pressures already identified / £m2 year old places underspend 2013/14 / 1.6
2009/10 DSG carry forward ending / 0.5
Sub total / 2.1
Potential DSG funding
Early Years Education support / 0.5
Quality Improvement advice / 1.1
Sub total / 1.6
Total / 3.7
10 Consultation
10.1 A draft paper was shared with members of the EYFS Nursery Advisory Group and Partnership Advisory Group and a presentation was delivered to schools forum, primary and secondary headteachers executiveand the Hampshire Governors forum. Overall, discussions acknowledged the impact of discretionary early year’s services upon the robustness of organisations, the quality of provision and school readiness. Longer term impact upon children as they reach secondary school age was also highlighted. It was recognised that without a significant uplift in the EYSFF base rate, providers would be unlikely to be able to buy support themselves and, often those most needing support, were least able to purchase it. Additionally providing an uplift to the base rate would mean that funding would be distributed evenly to all EYE providers rather than to those settings who require support most. Schools were generally keen to be involved in working with their local provision but many felt they would not have the capacity to offer the level of support required and this could lead to an uneven distribution of targeted support across the county. It was acknowledged that the services proposed in this paper would continue to include schools in modelling best practice and would help schools in their linkages with the EYFS sector.