Revealed: Two thirds of poorest families miss out on childcare, as government urged to ‘think differently’  - New IPPR report

New analysis on the quality and quantity of childcare provision in England has revealed that the massive expansion of free childcare currently underway is at risk of not delivering for poorer families, according to a new report from the Institute for Public Policy Research (IPPR) and Save the Children. 

Amongst the poorest fifth of parents with young children, only a third (36 per cent) use formal childcare, compared to double that (73 per cent) of the highest earning households. 

Analysis by IPPR shows that use of formal childcare is highly defined by class. Over two-thirds of parents of young children who work in professional jobs such as lawyers, doctors and architects use it, compared to less than half of parents in elementary occupations such as cleaners, care workers and hairdressers. 

Further analysis by the think tank of local access to private and voluntary nurseries as well as childminders – who deliver nearly all provision for children under 3 – finds significant variation in access to childcare within a reasonable travel time by local authority, with deprived and rural areas the worst off. 

The more deprived or more rural a local area is, the fewer and lower-quality childcare options families tend to have. The most deprived areas have 32 per cent fewer places per child and 25 per cent fewer good (according to OFSTED) places compared to the most affluent areas. Rural areas have 31 per cent fewer places and 29 per cent fewer good places compared to inner cities and town centers. 

For example, three in four children in Walsall live in areas that have some of the worst access to childcare in England. 

Differences in levels of access cannot be fully explained by the number of households who are in-work with children. 

There are also huge regional and local variations. For example, parts of the North-East have five times the average ratio of childcare places to children. However, other parts of the same Combined Authority are amongst the least well served in the country. 

Part of this problem is driven by the falling numbers of childminders. At the current rate – a drop of around 3,000 childminders per year – there may be none left by 2033. 

However, another issue is the lack of places in school-based nurseries. Whilst the number of schools offering nursery provision has grown since 2018, the headcount of children in primary school nurseries has reduced by 14 per cent (the equivalent of 42,000 children) between 2015/16 and 2023/24.  

This decline has been most stark in the more economically disadvantaged local authorities and may reflect schools offering full-time entitlement places to children from working families at the expense of part-time universal places for those who don't qualify. 

IPPR and Save the Children are proposing a series of policies to boost England's diverse market of 56,000 childcare providers, including by:  

• Establishing new not-for-profit nursery trusts to rival private equity backed for-profit chains, with the aim of helping smaller childcare providers with business support, best practice and achieve the same economies of scale as larger groups. 

• Reinvigorating the role of local authorities including by pooling funding to secure new childcare in the areas of greatest need and more actively brokering the new schools-based nursery expansion. 

• Growing and supporting the supply of childminders by developing a new long-term national strategy which sees them paid monthly to deliver funded entitlements and explores a new childminder friendly national digital platform. 

• Increasing funding for deprived areas and children through raising the Early Years Pupil Premium and increasing weighting for Additional Need in the national formula. 

• Reforming the SEND funding system, giving greater recognition to emerging needs in early years within mainstream funding. 

Jodie Reed, associate fellow at IPPR, said: 

“The extension of funded childcare entitlements currently under way is unprecedented. But our analysis shows that if the government doesn't think differently about the delivery, it could leave the poorest children and families far behind – without access to decent quality provision which matches their needs – and the government far from reaching its Opportunity Mission goals to reduce poverty and narrow gaps in early childhood outcomes. 

“Yet as the first UK government in history to be the biggest buyer of hours in England's childcare market, there is an opportunity to re-imagine childcare as a public-led service – more akin to schools. National and local governments should play a much more proactive role in addressing problems in the market, supporting the system to deliver quality and delivering a real childcare guarantee for every child.”   

Ruth Talbot, Policy and Advocacy Adviser at Save the Children UK, said:  

“Childcare that is accessible and affordable is critical for families and while we welcome the recent expansion in provision, major reforms are still needed to fix the system. The innovative proposals presented in this report attempt to deal with childcare deserts, a lack of funding and the patchwork of commissioning services. 

“A new focus on children with SEND is essential and we support making better use of the standard two-year-old health checks to unlock funding. Local leadership and the development of not-for-profit childcare trusts is also something the UK Government should consider, ensuring the poorest children are targeted. 

“In all, the childcare policies proposed in this report would improve support for families and help ministers reach their ambitious target of half a million more children meeting their early learning goals in six years.” 

Dr Jamie O'Halloran, senior research fellow at IPPR, said: 

“Childcare should be a cornerstone of a fair society, but our findings reveal deep inequalities. Disadvantaged families face systemic barriers that prevent them from accessing the childcare they need. A reimagined system, with fair funding and local leadership, can transform childcare into a true public service that works for everyone.”