A blueprint for 2020: the expansion of early learning and childcare in Scotland – consultation analysis report

6. Affordability

The two key aspects to affordability are: the costs faced by parents and carers; and the costs to the public sector of delivering the overall system.

On top of the free hours to ELC entitlement, parents may require additional hours from their ELC provider. For some on low incomes, costs such as initial deposits and administration fees, can provide a barrier to participating in the labour market or in further or higher education.

Question 17: Do parents and carers face any barriers in accessing support with the costs of ELC provision (beyond funded entitlement)? What more can we do to ensure additional hours are affordable?

6.1 238 respondents (71%) answered this question.

General views

6.2 Many respondents identified challenges to parents in funding additional hours, with much reference made to the situation of low-income working families, who may not be entitled to various benefits, yet still face costs of additional hours and sometimes inflexible childcare provision which do not fit with their working patterns.

6.3 A few respondents identified the wider context of welfare reform and pay and conditions of the workforce as playing major roles in promoting affordability of ELC provision.

Views on accessing support with the costs of ELC provision beyond funded entitlement

6.4 The most common view was that the tax and social security systems which could provide help to those facing financial barriers, are complex and difficult to understand. Many respondents, from a wide range of sectors, considered that awareness raising, and help with understanding the financial assistance on offer through the tax and social security systems, would support parents in accessing ELC provision beyond funded entitlement.

6.5 Students in further and higher education were highlighted by a few respondents as requiring specific advice on what financial support is available and how to access it.

6.6 A few respondents from the third and voluntary sectors commented that some parents do not take up benefits and tax credits for fear of subsequent claw-back.

6.7 Other relevant suggestions included the need to make the tax credit scheme more efficient to avoid what some had experienced as delays following application; and fine-tuning entitlement to financial support for specific cases such as travelling communitites; carers; parents whose children have disabilities and/or ASNs; and childminders whose own children take up their places.

Views on what more can be done to ensure additional hours are affordable

6.8 Three main actions were identified: charge less; charge the same, but make it easier to pay; charge the same but provide help with associated costs.

Views on ways to charge less

6.9 The key way to charge parents less for additional hours was seen as the Scottish Government subidising costs by providing greater funding for ELC to local authorities and this being passed on to partner providers. Individual respondents and private sector providers expressed most support for this. It was considered that by reducing ELC costs, parents would be more incentivised to take up work, thereby reducing costs to the benefit system in due course.

6.10 A few respondents supported the introduction of means-testing as a way to establish costs for additional hours in a more equitable manner.

6.11 A small number of respondents considered that a fee cap on additional hour costs based on a proportion of the household income could work to make additional hours more affordable.

6.12 A recurring view was that discounts should be given where many additional hours were required, or where several children from the same household were in need of additional hours.

Views on ways to make it easier to pay

6.13 It was commonly felt that allowing flexibility into the payment schedule for the deposit and regular payments would go some way to helping with budgeting for costs.

6.14 Several respondents from a range of sectors considered that paying for additional hours directly from salary or benefits would help prevent families using funds meant for ELC for other things.

6.15 The notion of funds for ELC being amalgamated into ELC accounts attracted some support from a few organisations. This was seen as simplifying payments for parents in helping them to budget.

Views on ways to provide help with costs

6.16 The additional, sometimes hidden costs of ELC provision, were identified and included: transport to the provider; outdoor clothing; meals and snacks; and so on. Individual respondents, in particular, suggested that help could be provided to parents in the form of subsidised or free transport, lunches and clothing grants.

6.17 A few organisations re-iterated previous comments about providers adopting strategies to ensure equitable access to their facilities, such as providing outdoor clothing such as wellies to avoid additional costs for parents.

6.18 A recurring view was that employers and further and higher educational establishments could do more to support parents with ELC costs, for example, through childcare vouchers.

Views relating to Question 17 emerging from consultative events

6.19 Discussion focused around low paid work and the challenges this created to affording ELC provision. One participant welcomed the help that working tax credits had given her in this regard.

6.20 Some participants suggested that greater funding from local authorities to partner providers would help with affordability.

Ensuring the long-term sustainability of the ELC sector

It is vital that the overall ELC sector is sustainable over the long-term, has appropriate capacity, and allows for diversity in providers across the public, private and third sector, as well as a wide range of innovative delivery models.

Question 18: How can ELC providers, particularly private and third sector providers, be encouraged to extend capacity?

6.21 216 respondents (64%) answered this question. A recurring view was that quality of provision should not be compromised in efforts to expand quantity of provision. Another repeated view was that some provision cannot be expanded, for example, where premises are shared with others and are at maximum capacity already.

6.22 The most common view, expressed across a wide range of sectors, was that to encourage private and third sector providers to extend their capacity, more funding will be required for these providers. Whilst many respondents identified "funding" as needed, others specified the need for sustainable, longer-term resourcing for increased staffing; paying Living Wages; additional training; and capital investment for adaptations to premises and new builds. A few respondents envisaged grants with 0% interest to support expansion; others identified financial "incentives" as important, with some mentioning reductions in business rate tax, for example.

6.23 Several respondents remarked that without longer-term security of funding, inward investment and loans from financial institutions would be harder to achieve. Several local authorities emphasised the need for early clarity on funding and timescales for the expansion, in order to assist with planning.

6.24 Another significant theme was the need for providers in clustered areas to work in partnership, collaboratively, strategically, using local information on current and future needs to come up with joint solutions for expansion. Local authorities in particular, favoured this strategic approach which they felt would make best use of resources and avoid duplicated effort. A few third sector and voluntary organisations considered that greater use could be made of currently under-used school facilities outwith school term time, in addition to boosting provision of workplace nurseries.

6.25 The theme of joint working was furthered with suggestions from respondents across a range of sectors for a partnership and shared approach to training the workforce, to ensure suitably qualified ELC workers are in place to accommodate the expanded hours.

6.26 Other signficant views put forward by several respondents were:

• Care Inspectorate standards and requirements may need re-visited to ensure they are not acting as barriers to expansion. The time required for applying for a variation was cited as a current obstacle, particularly for childminders who wish to increase their capacity.
• Support from local authorities over planning applications and building regulations could go some way to helping private and third sector providers through the planning application process.
• Private and third sector providers may benefit from help with business planning and development. Professional advice was viewed as important in order to help such providers secure loans from banks.

Views relating to Question 18 emerging from consultative events

6.27 Potential was identified for expanding capacity amongst private and third sector providers, in collaboration with other partners, possibly in blended models. It was considered that extending the premises of primary schools offered opportunity to provide more ELC capacity in this way.

6.28 The view emerging from one group was that space currently used for training purposes and meeting parents, should not be compromised by using it for extending ELC capacity.