Category Archives: Education

GK Point of View - Monica Thompson on the challenges facing the early years sector

GK Point of View – Monica Thompson on the challenges facing the early years sector

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GK Consultant and education expert, Monica Thompson, takes a look at the challenges facing the early years sector.

While the Covid-19 pandemic has affected the entire education sector, this period has been particularly challenging for nurseries, pre-schools and other early years settings. Ofsted’s recently published findings on the pandemic’s impact on children of all ages and backgrounds. It reported that children who had been hardest hit by the pandemic actually regressed in terms of their basic skills and learning. Similarly, research by the Sutton Trust from May 2021 [1] emphasised that over half of parents of pre-school children were worried about Covid-19’s impact on their children’s wellbeing and long-term development.

The Social Mobility Commission report ‘The stability of the early years workforce in England’, published in 2020, had previously found that that low pay, heavy workloads and a lack of career development for early years workers were likely to have a serious impact on nurseries, pre-schools and other settings. The pandemic proceeded to lay bare the vulnerability of the already struggling early years sector. In April 2022, the Department for Education published three new reports which were commissioned from the National Centre for Social Research (NatCen) and Frontier Economics [2]. The reports focus on Covid’s impact on the early years sector and jointly emphasise the challenges posed by funding constraints and severe staffing issues (including workforce recruitment / retention), as well as wider economic pressures and generally rising costs. The reports also raised concerns about deregulation and the mooted relaxation in staff/child ratios – stating that it might lead shortages of qualified and experienced people in the sector.

The same reports also found that 72% of private, voluntary and independent (PVI) nurseries and pre-schools have lost staff since the pandemic began. Nearly half (47%) of PVI nurseries and pre-schools said the main reason for staff leaving was to seek better pay while, worryingly, an even higher proportion (60%) reported that those exiting are leaving the sector entirely. The reports also collectively found that 54% of PVI settings and 49% of childminders report that their total costs have ‘notably’ increased on pre-Covid levels. Indeed, only 39% of private providers and 21% of voluntary providers were in financial surplus in 2021 and, for childminders, the figure fell to just 19% [3].

It is worth noting that all main political parties are now emphasising the growing problems over childcare’s affordability. The main focus of the current government, in terms of addressing these early years financial challenges, has generally been on parents’ employment and behaviour, not their circumstances. However, the paradigm has started to shift in recent months. For example, in October 2021, Nadhim Zahawi MP, during his first conference speech as Education Secretary, recognised that 40% of educational inequality is ‘baked in’ by the age of five. He also said that the Government would invest a record £180 million in ‘outstanding’ early years staff.

Looking ahead, we can expect a stronger focus on early years issues over the months ahead. Ofsted’s recently published five-year strategy [4] emphasises the inspectorate’s work in the early years sector and recognises the pandemic’s impact on young children. Indeed, Her Majesty’s Chief Inspector (HMCI), Amanda Spielman, has said that Ofsted wants to bring early education to the fore and will work on developing the associated evidence base. The organisation’s new 2022-2027 strategy not only acknowledges that the sector has been hit hard by Covid-19 but quantifies the problem by recognising that, during the course of the pandemic, the number of registered childcare providers fell from over 75,000 to just below 70,000 – with childminders accounting for the bulk of the reduction. However, ultimately, Ofsted’s commitments will only work if they are backed by government policy that supports the Early Years sector. The sector also needs appropriate investment to guarantee that nurseries, pre-schools and other early years settings are able to provide quality care and education.

For more information, please contact Monica at monica@gkstrategy.com

[1] Fairness First: Social Mobility, Covid and Education Recovery – Sutton Trust

[2] The three reports can be read below:

[3] Impact of Covid on childcare settings highlighted in new DfE research – Early Years Educator

[4] Ofsted Strategy 2022 – 2027

What does a _review_ of government policy on employer training mean_

What does a “review” of government policy on employer training mean?

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Perspective by David Laws, GK Adviser

Last week the Chancellor, Rishi Sunak, made a few waves in the education sector by announcing in his Spring Statement a “review” of government policy on employer training, including the Apprenticeship Levy. The announcement caught many by surprise, including apparently some of the Chancellor’s colleagues in the Education Department.

By the end of the week, some were suggesting that the “review” was not a formal “Review”, and might not result in much change in the Levy. So, what exactly is going on? Well, the Apprenticeship Levy seems to have strong backing in the government, and indeed across the political parties. Inevitably, there are often calls for tweaks, for more “flexibility” and for a variety of different reforms – not all of which are mutually compatible.

The Chancellor’s “review” could result in looking again at some of these practical issues, which also include the extent to which the existing Levy is being used to support new entrants into the labour market, as opposed to existing staff (some of whom may already have higher level, tax-payer supported, qualifications). But the Chancellor might have something new or “additional” in mind, to work alongside the Levy. In his recent “Mais Lecture” the Chancellor started to set out his vision of a post-pandemic economic strategy, including “investment in people”. Some have speculated that he may want to introduce some sort of discrete tax credit to incentivise training. This would presumably involve reformulating the existing tax relief for training which is available through the corporation tax system. The aim, in any case, seems to be to raise the amount of expenditure by employers on training, and improve its quality and focus. The review will look at whether current incentives are delivering the “right kinds of training”.

What should those interested in the Apprenticeship Levy make of all this? It seems if there is still a strong commitment to the principle of the Levy, and a desire in some parts of government not to rock the boat too much. This could suggest that the review will make small changes to the Levy, while perhaps restructuring other training reliefs.

But it would be unwise to take any review into this area for granted – not least one where the powerful Treasury appears to be in the driving seat. To the extent that the review does look at if “the current tax system is incentivising the right kinds of training”, the review could ask some fundamental questions, which could have both direct and indirect effects on the Levy. This could include looking at issues raised by the Augar Review, around the support for higher level apprenticeships.

Whether this “review” is one with a small “r” or capital “R”, all those interested in the Levy and the future of government policy on training support incentives should be using this as an opportunity to feed into government their views on how the system should evolve. The review is going to need to address some fundamental issues, and what impact this will have on future government policy on training cannot be taken for granted.

David Laws, GK Adviser and Former Minister – Response to Augar

David Laws, GK Adviser and Former Minister – Response to Augar

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The government has today announced its (very!) long awaited response to the Augar Review on post 18 education finance. The announcement will be eclipsed by the dramatic news of Russia’s invasion of Ukraine, but it is of importance for the long-term outlook for post 18 education.

The Augar Review was originally inspired by Theresa May’s desire as PM to offer a reduction in student tuition fees, after this became a major issue in the 2017 General Election.

It is believed that May wanted fees cut to £7,000 or £7,500 – perhaps with higher government grants to protect the more “expensive to deliver” courses. There was also a strong desire to shift financial resources away from “low value” Level 6 HE courses, towards Level 4/5 provision in subject areas of greater relevance to skills shortages and the labour market.

Today’s news indicates how far the government has moved from the initial May/Augar vision. Tuition fees will remain at £9,250 for the rest of this Parliament, and quite possibly beyond. Labour has also, under Keir Starmer, moved away from prioritising lower tuition fees. Instead, policy makers will allow inflation to gradually eat away at the real value of fees, which will over time put greater pressure on university finances.

Not only will students be stuck with £9,250 fees, but future students will be expected to start repaying their loans at a much lower level of real incomes – £25,000, instead of over £27,000 at present. The government and the Treasury have decided that students must pay back a lot more towards their loans, rather than allowing taxpayers to take the strain. As well as repayments starting earlier, payments for many will last much longer – for 40 years (before write-off), rather than the existing 30 years. However, in one piece of good news for students, the interest rate on student loans will be cut, so that it is limited to the RPI measure of inflation.

Overall, the changes to student repayments are regressive – lower earning students will pay a higher proportion of income, while higher earners gain from the lower interest rates. The strongly progressive structure put in place by the Coalition government is being watered down.

Where the conclusions of the review do still follow some of the Augar agenda are around the more generous Lifelong Loan Entitlement for both HE and other technical post 18 courses, at Levels 4/5/6. And the two consultations on minimum entry grades for post 18 study and around student numbers control are very important shifts towards potentially restricting access to university courses to those with higher attainment, and to courses with higher labour market returns. This is another major shift away from Coalition policy, which allowed for sector and student led increases in HE places.

The reviews will be controversial, and could make a major difference to the final policy proposals. Disadvantaged students could be big losers from any attempt to restrict university places to those with higher grades, while those delivering courses that lead to typically lower paying jobs will worry that they could face new restrictions on student places. By establishing reviews into both these issues, the government is accepting that change is highly controversial and needs much further thought.

If you would like to discuss the landscape for education policy in the UK, please email louise@gkstrategy.com