Wellbeing of children under five and supporting the early years sector affected by the COVID-19 pandemic, House of Commons 20 January 2021

The early years sector experienced challenges throughout the first national lockdown with more than 69,000 early years providers temporarily closing during the coronavirus pandemic.


Key messages

  • In our Child-centred recovery report we highlight how effective, high quality early years provision makes a difference to young children, helping to break the cycle of disadvantage, improving social mobility and offering them a good start in life. Early years providers have continued to support children throughout the COVID-19 crisis.
  • The early years sector experienced challenges throughout the first national lockdown with more than 69,000 early years providers temporarily closing during the coronavirus pandemic, with many settings citing financial difficulties as a key reason. Among those that remained open, to provide care for vulnerable children and the children of critical workers, many operated at a loss.
  • Funding arrangements for many private, voluntary and independent early years settings only covered around half of their normal income, and even with additional support such as the business rates holiday, in many cases it was more financially sustainable for settings to close so they can access funding to furlough their staff.
  • The LGA has repeatedly raised concerns about the underfunding of the early entitlements, so it was good that extra funding was announced in the recent Spending Review. Whilst this funding was welcome, with many early years providers struggling due to COVID-19 it was disappointing that this was not a more significant and immediate investment to support providers during this unprecedented time.
  • The early years sector has been asked to stay open throughout the third national lockdown announced on Monday 4 January 2020. Given a recent report from Coram states that 58 per cent of local authorities think that local childcare providers may close for good, immediate investment is needed. The clarity released in regards to the census count has been brought some clarity and relief but concerns still remain about the sustainability of the sector.
  • Children from more disadvantaged backgrounds have struggled the most during the pandemic. Parents from disadvantaged backgrounds reported spending less time on activities with their babies and toddlers compared with parents from more advantaged backgrounds. Children from disadvantaged backgrounds also had less access to books and spent less time on play or activities requiring outdoor space.
  • There has been widespread redeployment of health visiting staff and in some local area teams have suffered notable reductions in size. The LGA has repeatedly called for health visitors and community health practitioners to not be diverted to acute care, to ensure we can prioritise supporting vulnerable families and babies and identify problems as early as possible.

Further information

As recognised in the Duchess of Cambridge research on early years, good quality early education has a positive impact on young children’s development, while childcare more broadly enables parents and carers to work and often gives children the opportunity to interact with other children and try new things in a safe space. Childcare providers have been a vital part of the nation’s response to COVID-19 and councils have been working closely with them to ensure that vulnerable children and critical workers have the childcare they need.

Funding for early years services

Following the first national lockdown and through the Autumn term 2020, the Government said that settings would continue to receive their early years entitlements funding, even if they closed. However, this funding only covers around half of a private nursery’s costs with the remaining derived largely from parent fees, which have clearly been significantly cut as most children stay at home. Around two thirds of private nurseries closed temporarily as a result, while those that remained open struggling financially, with some operating at a loss. 

In light of the latest national lockdown, early years providers have been requested to stay open whilst school premises are closed to those apart from key worker and vulnerable children. We fully recognise the importance of early years provision to ensure that parents have access to good quality childcare to enable them to work and that children have the support they need to develop school readiness. However, we need assurance that this is safe for children, families and staff and the early years sector needs to be effectively resourced.

We need to keep a close eye on the attendance numbers at early years settings, and initial figures suggest that these are significantly lower than as would be expected with only around half of children normally in settings attended in the week ending 8 January. The Government should ensure that no provider is operating at a loss in order to deliver the government’s childcare commitments, and that sufficiency is not impacted to the extent that there is an impact on childcare spaces when the country moves to recovery. 

We have repeatedly raised concerns about the underfunding of the early entitlements, so it was good that extra funding was announced in the November Spending Review. However, with many early years providers struggling due to COVID-19, it was disappointing that this was not a more significant and immediate investment to support providers during this unprecedented time.

Even without the additional pressures of COVID-19, low funding rates result in low pay for childcare workers, with almost half (45 per cent) of childcare workers also claiming state benefits and childcare workers earning around 40 per cent less than the average female worker. This in turn is resulting in a recruitment and retention crisis in the sector, in particular for well qualified staff. This fails to recognise the vital work that childcare workers do and the significant contribution they make to the future life chances of all children.

It is crucial we retain the good quality early education and childcare that improves children’s outcomes and reduces the disadvantage gap. Given a recent report from Coram states that 58 per cent of local authorities think that local childcare providers may close for good, immediate investment is needed.

Impact on more disadvantaged children

During the pandemic, children from disadvantaged backgrounds have been unequally impacted in comparison to their well-off peers. For instance, parents from disadvantaged backgrounds reported spending less time on activities with their babies and toddlers compared with parents from more advantaged backgrounds. Children from disadvantaged backgrounds also had less access to books and spent less time on play or activities requiring outdoor space.

While all young children experienced an increase in TV and touchscreen use, children from disadvantaged backgrounds were particularly likely to have high daily screen use. Babies and toddlers from disadvantaged backgrounds have been missing out on activities to support their development, compared to children of highly-educated, well-paid parents.

We have been calling for health visitors and community health practitioners to not be diverted to acute care, to ensure we can prioritise supporting vulnerable families and babies and identify problems as early as possible.

LGA’s Child-centred recovery report

We published our Child-centred recovery report, which outlines our ambitions for a child-centred recovery, drawing together every aspect of policy and service delivery to create the places people want to live in and plan for the future. Our immediate priorities are:

  1. A cross-Whitehall strategy that puts children and young people at the heart of recovery.
  2. Investment in local safety nets and the universal and early help services, including mental health and wellbeing services, that children, young people and their families will need to support them through the short and long-term impacts of the pandemic.
  3. Dedicated action to prevent the attainment gap from widening, including immediate work to stabilise the early years sector and support children and young people to attend school or to continue learning from home where required.