Foundation Years: Sure Start children's centres - Education Committee Contents

5  Local and central Government: funding, commissioning and strategic planning


107. Funding streams for early childhood and family services are varied and confusing. In April 2011 the Government removed the ring-fence from Sure Start funding and introduced the Early Intervention Grant (EIG), with the result that it is not possible to put a figure on central government funding for Sure Start from 2011/12 onwards. From April 2013 EIG was transferred to the Department for Communities and Local Government to include in its Business Rates Retention scheme. Funding for the two year old offer was initially included in the EIG but has been transferred to the Dedicated Schools Grant. The EIG, excluding the two year old offer, is decreasing, meaning that there is less money available to spend on children's centres. Information provided by the LGA, based on DfE returns, shows a total planned expenditure by local authorities on Sure Start and children's centres of £1.0 bn in 2011/12, falling to £0.95bn in 2012/13: a decrease of 4.6%.[236] Policy Exchange estimates that in 2013/14, spending on children's centres will fall to around £0.854bn, a total reduction of 28% from 2010.[237] Prospects for local government funding to 2015 suggest that further significant reductions should be expected.

108. Unsurprisingly, these reductions in funding have resulted in reductions in the services provided by children's centres. The ECCE Strand 3 report found that 72% of centres had experienced changes in services due to cuts and 80% expected changes in 2012/13.[238] Several submissions expressed concern about the impact of uncertainty around funding and further reductions. 4Children reported that "our census shows that centres are being asked to deliver more for less, and are, in many cases, succeeding." It noted that the "local picture of budget decisions remains highly mixed with some local authorities taking greater steps to protect budgets" but warned that "there will be limits as to what can be done without significant ongoing investment".[239]

109. 4Children and Action for Children both called for a clearly identifiable funding stream for early intervention. 4Children warned that without this, "local authorities will not prioritise or maintain funding for vital children's services, and [...] the money which has previously allowed Sure Start centres to deliver for their communities will be spread across the local authority."[240] Action for Children also called for a re-enforced duty on local authorities to ensure the continued delivery of early intervention services.[241] Other demands for the re-introduction of ring-fencing for funding for children's centres were opposed by local authority witnesses who argued that in the past children's centres "were awash with money" and that under the current arrangements more can be spent on early intervention.[242] The Minister supported the local authority view, saying that "We need to see children's centres as part of an overall offering in the local area".[243]

110. Professor Eileen Munro's review of the child protection system emphasised the importance of early help.[244] An NAO landscape report in January 2013 found that "the Government has signalled its commitment to the principle of early action, but there is little evidence of a concerted shift in resources to early action projects, or cross-government co-ordination, either in consistent definition and measurement or in establishing adequate support structures."[245] The study also found that "some local authorities seem more determined to use a longer-term approach, but central and local government need to do more to incentivise practitioners to exploit early action potential."[246] The APPG on Sure Start recommended in July 2013 that the Government commit to shifting 2-3% of spending from late intervention to early intervention each year in the 2016-18 Comprehensive Spending Review.[247]

111. We believe that it was right to remove the ring-fencing from funding for children's centres because of the different ways in which the centres are used by local authorities and the different services provided by them. In principle, we would welcome the end of ring-fencing for early intervention as a whole to give freedom to local authorities to respond flexibly to needs in their area— if the accountability framework were effective enough to ensure that funding decisions led to improved outcomes for children. Given the current accountability framework, we do not believe that the ring-fence around early intervention spending should now be removed. There should, however, be more transparency on Early Intervention Grant spending by local authorities so that it is clear how much has been spent on different services. We recommend that the Government ensure that this is done.

112. Research evidence shows clearly that investment in early intervention reaps rewards.[248] It is the most effective way in which the gap between the most disadvantaged children and their peers can be addressed. Reductions in spending on early interventions therefore risks being counter-productive, requiring more money to be spent later on.


113. Local authorities commission children's centres to deliver specific outcomes based on need, jointly assessed with health and other partners. The Health and Social Care Act 2012 shifted responsibility for public health to local authorities, potentially providing for a closer link with social care and children's services. From April 2013, Health and Wellbeing Boards under local authorities have a duty to set the strategic direction for health and social care commissioning for a local community through Joint Strategic Needs Assessments (JSNAs) and Joint Health and Wellbeing Strategies (JHWSs). They have been encouraged to ensure that the JSNA and JHWS take account of early years, working in partnership with early years' services, children's social services and clinical commissioning groups. The DfE sees children's centres having a part in "influencing local strategic assessments, and commissioning decisions taken forward by the local authority, in partnership with the Health and Wellbeing Board", through "assessing strengths and need across the area".[249] From 2015, responsibility for commissioning services for 0 to 5 year olds and health visitors will also move from NHS England to local authorities. These new arrangements should offer greater scope for multi-agency commissioning, which evidence to our inquiry suggested was currently weak, with separate budgets for health and employment services and separate budget-holders.

114. Centre leaders and providers criticised the current approach to commissioning by local authorities, particularly its short-term nature. Barnardo's stated that: "the tendency of commissioners to offer contracts of three years or shorter, makes it difficult for voluntary sector providers of Sure Start children's centres to demonstrate either short- or long-term outcomes [...] let alone recoup tender and set-up costs. It is an improbable business model that delivers profit and reliably measureable results within one year and no private sector start-up would plan to do so."[250] Dame Clare Tickell of Action for Children stressed that "the commissioning of children's centres must provide more emphasis on stability for children and families" through a Government commitment "to developing an approach to funding that is underpinned by long-term planning and consistent support".[251] This would allow a move away from three year contracts, with a primary focus on price. Local authority witnesses pointed out that short-term commissioning was the result of uncertainty over their own budgets.[252]

115. We believe that multi-agency commissioning makes for the best use of resources and the most informed service delivery. We recognise the difficulties caused by short-term funding decisions and recommend that the Government examine how a longer term view of children's centre funding can be taken within current spending decision cycles.

Reconfiguration and closure of centres

116. Ofsted reported that many local authorities are redesigning their centres so that they operate in clusters, leading to a reduction in administration and back office costs and increased opportunities to share specialisms. In addition, an increasing number of centres are being brought together to operate under shared leadership, management and governance arrangements.[253] In response, Ofsted has revised "its framework so that it is flexible enough to take account of the wide range of organisational structures that are emerging across and within local authorities".[254] This means inspecting groups of centres across localities.

117. Research by the NFER found that "leaders and local authority staff were more positive about cluster models (where several Children's Centres work together on strategic goals) than 'hub and spoke' models (whereby a leader of a hub Centre is responsible for the work of satellite centres)".[255] The leaders felt that they were unable to get to know the families using satellite centres and reported inefficiencies in managing split sites (such as travelling time). A few leaders also complained of increased accountability without the autonomy to remodel their Centres to meet local needs.[256] The ECCE Strand 3 report, however, found that centres did not think that a single site was the key factor in centre ethos.[257]

118. In some cases, centres have reduced their services rather than closed. Naomi Eisenstadt expressed concern that this had led to centres which were "half a person and a bunch of leaflets", thus rendering them ineffective.[258] She suggested that it would be better to have fewer, better resourced children's centres in the poorest communities. Others disagreed. Arguments against fewer centres include access difficulties and a need to recognise the natural boundaries of different communities within an area. Closing centres inevitably means that some disadvantaged groups would lose the service and it is highly controversial because they are very popular with parents.[259] Recent coverage of the planned closures in Oxfordshire illustrates how strongly communities feel about access to local centres.

119. The DfE's statutory guidance contains a presumption against the closure of individual children's centres. The LGA argued that this "undermines the flexibility of local authorities to design services in a way that best meets local need and deploys resources to maximum benefit".[260] Barnardo's suggested that rather than closing under-utilised centres, more should be done by local authorities to co-locate services and also to allow the centres to be used in the evenings and at weekends as community facilities.[261] 4Children also suggested that "the priority for policymakers ought not to be the closure of Children's Centres or withdrawal of services, but rather sustaining the existing network and ensuring that value is maximised".[262] For example, East Riding of Yorkshire Council told us that their centres were used as training venues in evenings and at weekends for practitioners, foster carers and support groups for parent/carers.[263]

120. Local authorities are also required to involve communities in the development of children's centres where significant changes to the range and nature of services are planned but one witness, Sue Owen of NCB, told us that "one of the things we lost fairly early on in the Sure Start programme was community involvement—a much greater role for local communities in commissioning services, designing services, and thinking about what services their local area needed."[264] She suggested that this type of "bottom-up push" might be needed now. ATL considered that the statutory guidance needed to be more explicit on what constitutes a significant change and that the duty must be strengthened to ensure that parents could make their views heard and influence any final decision by the local authority.[265]

121. Closing centres is not popular but we accept that the current pattern of provision may not be the best model to meet the needs of different areas. Change in the network may make centres as a whole more effective. We therefore welcome the innovative approach being taken to adopting different models of provision. New patterns of provision will require fresh responses from centre workers and their partners. Local authorities should be prepared to help with this, whether with training or other practical assistance.

122. An existing centre should be closed only where there has been proper consultation with the public and where the local authority has made a strong case for a better way of achieving outcomes. Alternatives to closure, including expansion and co-location of services, should be considered as options in the consultation. Outstanding children's centres should be encouraged by their local authorities to become public service mutuals or to devise other methods to continue their work.

Local authority accountability

123. Local authorities are held accountable for the effectiveness of children's centres through Ofsted inspections of centres and of the authority's children's services as a whole, but there is little to suggest that a general failure of children's centres would lead to serious repercussions for the local authority. The new outcomes framework we recommend earlier in this report would help to focus minds and attention but would not be sufficient unless greater accountability for local authorities were attached to that framework.

124. In its July 2013 report, the Social Mobility and Child Poverty Commission highlighted this difficulty and expressed concern that "the Government's objectives for the early years, including high quality early years education and children's centres (especially for low income parents), are threatened by lack of adequate mechanisms for Government to hold Local Authorities to account".[266] It recommended that the Government should

    prioritise the development of new local accountability mechanisms, including on local delivery of children's centres and availability and quality of free early learning places for 2, 3 and 4 year olds. [... This should include] central collation and public reporting of information, perhaps by Ofsted, on the state of provision of early education and children's centres in each Local Authority area, to include: the number of providers, qualifications of staff, hours of opening, quality and population served. The goal should be to strengthen local accountability and parental choice, whilst enabling a central social mobility objective (closing developmental gaps) to be achieved.[267]

125. The Minister told us that she was "keen to see local authorities held to account for their overall performance in the provision of services and early intervention for young children, rather than just the children's centres, because it is hard to isolate the specific impact of the children's centre as opposed to the overall range of services the child and parent have."[268] She agreed that "we need to make sure local authorities are clear about what the outcomes are of the programmes they run and what they achieve"[269] and that "Local authorities should ultimately be accountable for the outcomes of those young children".[270]

126. The accountability framework must ensure that the lead member and Director of Children's Services remain focussed on early years. Questions raised by Ofsted about children's centres in an authority should trigger the same reaction as questions about schools or other children's services. We recommend that the Government consult on a new accountability framework for local authorities' children's services that puts as much weight on early years and children's centres as on schools and children's social care.

Government policy


127. The Government extended free pre-school education and care to 20% of all two year olds in September 2013 and will extend it further to 40% from September 2014 at a cost of £534m in 2013-14 and £760m in 2014-15. The offer comprises 15 hours of free nursery care per eligible child. According to the DfE, "success will be measured through an increase in the proportion of disadvantaged two year olds accessing an early learning place."[271] Results of research into a pilot run between 2006 and 2008 were not promising, but the new scheme differs from that piloted by offering double the hours per week in good or outstanding provision.[272]

128. Several concerns were raised with us about the two year old offer in the context of children's centres. Dame Claire Tickell cited the offer as an example of how children's centres were not integrated properly within the wider system.[273] Other witnesses were concerned about the impact on the childcare provision for other age groups; on the finances of children's centres since the funding for two years olds was below cost; and on other services because centres were expected to provide family support to the two year olds in addition to early education without additional funding for this.[274] Finally, Naomi Eisenstadt described the offer as "nuts" because it should be "a conditional offer on a kind of support within a children's centre".[275] Other witnesses considered that the link between the two year old offer for children and training or employment support for parents should be encouraged but not made mandatory.[276]

129. We also heard evidence of differences in the funding provided to local authorities to deliver the provision. The National Day Nurseries Association told us that, although the Minister had asked local authorities to spend at least £5.09 per hour, "some local authorities are still only spending £4.85 for the two year olds".[277] The Minister agreed that "it is unfair at the moment and it is vastly disparate from local authority to local authority".[278] Responding to concerns about the availability of places in appropriate settings, she told us that she had "not received any evidence that there is a shortage of places for two year olds".[279] Local authority witnesses agreed that this would not be a problem.[280] By 11 November 2013, 70% of the necessary places had been found for two year olds.[281] This leaves some way to go in the current year, and even further for next September.

130. We welcome the two year old offer but have concerns about the funding, the quality of providers, the availability of places in effective settings and about the impact on places for other age groups. We recommend that local authorities monitor and report back to Government on the number of places available in good or outstanding settings in 2013/14 in order that action can be taken before September 2014 if necessary.

131. There is a clear disparity in how funding is being used by local authorities. The Government should monitor funding and the impact on positive outcomes for children. We recommend that there should be flexibility in the use of the funding by local authorities to offer direct support or parent intervention where families are not just poor but also vulnerable.


132. There are no quick fixes in early years provision, nor can the results of interventions be demonstrated quickly. We heard some criticism of the lack of integration between various elements of Government policy. For example, Professor Nutbrown expressed concern that the Government was rushing into implementation of new policies on qualifications without proper consideration.[282] Among other witnesses, Action for Children argued that there was a "disconnect" between the Government's offer of free early education and early intervention services offered by children's centres, explaining that "parents have the biggest impact on their children's educational attainment, so that efforts to improve school readiness will be undermined if early intervention and parenting support is detached from the early education offer." It called for Government policy "to promote a joined up early years offer for children and families."[283] This is not just a recent problem. Anne Longfield of 4Children pointed out that "over the years significant amounts have rightly been spent on early years and childcare provision, but effective co-ordination between programmes is what, at times, has been missing".[284]

133. The July 2013 report from the Social Mobility and Child Poverty Commission found gaps in the Government's long-term ambition for early years provision and identified "a need for far greater clarity about the Government's long-term objectives". The Commission claimed that "it is unclear what final destination Government is aiming for, when it hopes to get there and how it will know if it has been successful". It recommended that the Government should "set out a long-term plan for narrowing the gaps in development in the early years, including how it will prioritise the quality of early education, children's centres and the role of parenting, to improve children's development".[285]

134. In the course of this inquiry, we have noted several contradictions in policy. For example, the Minister evinced no enthusiasm for maintained nursery schools; yet these are widely recognised to provide the highest quality early education and—when combined with children's centres—offer the most effective model for achieving the child outcomes that children's centres were set up to achieve. In the absence of a clear strategy to secure their future, many maintained nursery schools have closed in the last decade, with the result that the opportunity to build on them to create a seamless integrated approach for parents and children has been lost. There is also a clear tension within the Government's policy on implementing changes to early years qualifications, as we explore in the next chapter of this report.

135. In general, there is a lack of clarity about how all the different services involved work to achieve the greatest impact in the early years stage. The Gross report on information-sharing called for "a single birth to five 'programme', setting out a single set of outcomes for children and families, the roles and responsibilities of different agencies and professionals in delivering those outcomes, and a single 'reward' system for achieving them".[286] The Ministerial response did not address this directly but Elizabeth Truss MP acknowledged to us that cross-Government working may not be at its most effective in the early years: "One of the issues we have is that it is very difficult for local authorities to merge services or create one-stop shops, because of the different instructions they get from different Government Departments". She also pointed to the "history of lots of different programmes being administered at a local level with different funding streams [...] with their own targets".[287] The Minister assured us that DfE was working with the Department of Health to ensure that "there is a clearer message"[288] and that "the silos between Government are also reducing [...] which is very important".[289]

136. There has been, and continues to be, too much short-term and disparate government policy in the area of early years. Too much reorganisation of services impedes professional relationships and communication. The change in funding for early intervention from DfE to DCLG emphasises the role of local authorities in tailoring services to meet local needs but breaks the direct link between the Department for Education and children's centres. Changes in funding streams also lead to short-term contracts and distract centres from their crucial work with disadvantaged children and families. We recommend that the Government set out coherent, long-term thinking on early years and the place of children's centres within that, including funding, responsibility across Whitehall and accountability.

137. We are particularly concerned about Government policy towards maintained nursery schools. They offer capacity and a recognised level of expertise which needs to sit at the centre of the Government's proposals on Early Years Teaching Schools. We recommend that the Department for Education set out a strategy for ensuring the survival of those that remain and for encouraging the further development of the network of nursery schools with children's centres throughout the country.

236   Ev 226 Back

237   Policy Exchange (2013), p20 Back

238   ECCE Strand 3, p.23 Back

239   Ev 202, para 7, 11 Back

240   Ev 205, para 30 Back

241   Ev 163, para 38 Back

242   Q737 Back

243   Q794 Back

244   The Munro Review of Child Protection: Final Report A child-centred system, Professor Eileen Munro, DfE (May 2011) Back

245   Early action: landscape review, National Audit Office, 31 January 2013 Back

246   Ibid., p7 Back

247   APPG on Sure Start, Best Practice for a Sure Start: The way forward for Children's Centres (July 2013) Back

248   See for example Moore, TG, and McDonald, M (2013), Acting Early, Changing Lives: How prevention and early action saves money and improves wellbeing. Prepared for the Benevolent Society. Parkville, Victoria: Centre for Community Child Health at the Murdoch Children's Research Institute and The Royal Children'sHospital


249   Sure Start children's centres core purpose, DfE, April 2012 Back

250   Ev 198, para 34 Back

251   Ev 163 Back

252   Qq725-6 Back

253   Ev 182 Back

254   Ibid. Back

255   Ev 176 Back

256   Ibid. Back

257   ECCE Strand 3, p. xxvii Back

258   Q24 Back

259   Q19 Back

260   Ev 224 Back

261   Ev 198 Back

262   Ev 206 Back

263   Ev 234 Back

264   Q351 Back

265   Ev w29 Back

266   Social Mobility and Child Poverty Commission, July 2013, p14 Back

267   Ibid. Back

268   Q783 Back

269   Q789 Back

270   Q795 Back

271   Response to Education Select Committee questions on the DfE Main Estimate 2013-14, DfE, 12 June 2013, published on Committee website Back

272   The Early Education Pilot for Two Year Old Children: Age Five Follow-Up, DfE Research report, March 2013 Back

273   Q34 Back

274   See for example Q53 [Angela Prodger], Q397 [Purnima Tanuku], Qq398-400 [Liz Klavins] Back

275   Q36 Back

276   See for example Ev 206  Back

277   Q351 Back

278   Q814 Back

279   Q870 Back

280   Qq 776-81 Back

281   HC Debates, 11 November 2013, c627 Back

282   Q707 Back

283   Ev 165 Back

284   Ev 209 Back

285   Social Mobility and Child Poverty Commission, Social mobility: the next steps, July 2013, p14  Back

286   Gross report, p6 Back

287   Q792 Back

288   Q789 Back

289   Q875 Back

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Prepared 17 December 2013