The Impact of funding changes on the Early Years sector

Written by Nina Taylor, Student at The Open University.

I was fortunate enough to have a proposal for a poster presentation accepted for the BECERA 2026 conference which gave me the opportunity to share my thoughts, as a former practitioner, on the impact that funding changes and political discourse has had on the early childhood sector in my area. The conference theme was Transitions but this could be interpreted in a number of ways especially since Emeritus Professor Peter Moss highlighted in his Keynote speech  the current crisis that the sector is undergoing, largely as a result of neoliberal thinking that has commodified and marketized early childhood education . As a result he argues that rather than being a public good , the early childhood education sector can now be likened to an economic  mechanism for producing human capital  rather than supporting principles of social justice, equality and an acknowledgement of how children best learn and develop.

When I prepared my proposal I had not heard the keynote speech but I would argue that the topic I choose aligned quite closely with what Professor Moss had discussed in his speech.

However  my interest had already  been  piqued having followed conversations both on social media and the wider news media by organisations such as The Early Years Alliance and NDNA highlighting concerns about the impact of funding changes together with concerns that increases in NI rates ( although laudable in many respects)  could increase costs for childcare providers and lead to closures or negatively impact staff recruitment or retention due to higher wage costs. As a student of Early Childhood Studies my concern is two-fold – parents and children will have limited access to high quality childcare provision, while practitioners will see little benefit in accessing higher education programmes as their efforts are unlikely to be rewarded either in terms of increase remuneration or increased employment opportunities. As a result efforts to increase the professional status and knowledge base of early years practitioners within the sector are likely to be thwarted by government policy that focusses more on  encouraging parents back into the workplace  rather than investing in high quality early childhood provision which, arguably would have greater impact on reducing social inequalities in the future.

Research has identified the importance of early childhood education in addressing social inequalities, termed social investment (West et a, 2019). They argue that provision of high quality childcare allows parents to return to the workplace, thus increasing employment productivity, as well as supporting young children’s cognitive and non-cognitive development.

Presumably this had some influence on the government’s decision when, In September 2025, the ‘working families’ early entitlement offer, which provides 30 hours a week of government-funded childcare and early education over 38 weeks of the year, was extended to families of children aged nine months to two years, given that the rising cost of childcare has often been cited as preventing parents from returning to work.

In order to ascertain what has happened in my local area I used a mixed methods approach  to build up a picture

  • Document Analysis: Utilized discourse analysis to examine funding policy documents.
  • Quantitative Data: Reviewed local childcare sufficiency assessments to identify supply–demand discrepancies.
  • Qualitative Data: Solicited voluntary responses from parents and practitioners via a private Facebook parenting group.

Arguably this study applies Weiss’s (1972) Theory of Change, a framework that maps how a policy intervention leads to desired outcomes through intermediate steps. Serrat (2017) describes it as a purposeful model outlining the chain of causal links from activities to results . My rationale is that the government’s intention was to use policy intervention to allow large numbers (estimated 60,000) of parents of young children to return to work and thus boost economic productivity.

However, although I acknowledge that this is a very small scale and localised study I would argue that my findings indicate that policy change  hasn’t led to the desired result. On the contrary it would seem that:

  • Local demand surpasses supply, with parents applying to multiple providers to secure places.
  • Practitioners report capacity constraints.
  • The childminder sector has experienced financial strain, with at least ten childminders ceasing operations as their businesses are no longer viable.

Childminder Business Sustainability chart  Leicestershire (April 2025)

Expansion of childcare survey Leicestershire (April 2025)

Some comments I received via the Facebook Group

“Whether it’s to do with the funding now but trying to find a space at either a nursery or a childminders is very difficult, this time last year I really struggled to find a place for my baby for just 2 days a week , I found myself needing to find a new place last month and again really struggled I went through 8 different childcare providers in my local area and all were full and had nothing to offer, luckily managed to find someone but not for all the days I needed so had to sort out with family for the day I didn’t have childcare. “

 

“From a nursery POV – the funding has definitely had an impact. We are busier than ever. We are finding we are having to turn some parents away as we are struggling to accommodate their days or they are needing to change their working days/hours to be able to take up spaces on the limited days/sessions we have available. The amount of parents I’ve spoken to who have viewed multiple settings and they have very limited availability as well. We are having building work done to be able to meet the demand of spaces, safelyMy advice to parents is definitely look round nurseries as soon as you possibly can.”

 

Not only has the  supply of early childhood places shrunk but a review of employment opportunities locally confirms that providers are looking to recruit lower qualified staff, or even unqualified staff, which will impact quality of provision. This reflects the findings by the Sutton Trust that “The proportion of unqualified staff working in the early years sector has risen in recent years: in 2023, 1 in 5 staff members were unqualified, up from 1 in 7 in 2018.”  (2024).

As result I would argue that funding expansions intended to broaden parental employment opportunities are undermined by insufficient capacity among providers. Without ongoing operational and financial support, the sector risks transitioning back to an era focused solely on basic childcare, lacking regulation and professional development. As highlighted by the Sutton Trust, “While it is welcome that there has been so much focus on the early years in political debate, there has been far too much focus on its role as childcare, and much less on it as early education” (2024).

My poster presentation highlighted key points that I have argued above and, having attended the conference and reflected on what I learned, I too, like Professor Moss, believe there needs to be a re-think of how we view the child and what sort of provision should be made available to meet both child and family needs. After all they should remain at the heart of any discussions around early childhood education.

References

BBC News (March 2023) , Free childcare expanded to try to help parents back to work, available at https://www.bbc.co.uk/news/uk-politics-64959611

Leicestershire County Council, 2025) Audit of Sufficient childcare places, available at https://resources.leicestershire.gov.uk/education-and-children/early-years/setting-up-and-running-a-childcare-business/audit-of-sufficient-childcare-places

Serrat, O. (2017). Theories of Change. In Knowledge Solutions (pp. 237–243), available at https://link.springer.com/chapter/10.1007/978-981-10-0983-9_24

The Sutton Trust (2024) General Election Policy Briefing Inequality in early years education, available at https://www.suttontrust.com/wp-content/uploads/2024/01/Inequality-in-early-years-education.pdf

Weiss, C. H. (1972). Theory of Change as a Program Model. As referenced in discussions of program evaluation lineage. Available at https://www.theoryofchange.org/what-is-theory-of-change/toc-background/toc-origins/

West, A., Blome, A., & Lewis, J. (2019). What characteristics of funding, provision and regulation are associated with effective social investment in ECEC in England, France and Germany? Journal of Social Policy, 49(4), 681–704, available at https://www.cambridge.org/core/journals/journal-of-social-policy/article/abs/what-characteristics-of-funding-provision-and-regulation-are-associated-with-effective-social-investment-in-ecec-in-england-france-and-germany/79A359993D1DB188E256FA30149E5E64

 

 

This entry was posted in Uncategorised. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *