Achieving quality in market-led ECEC

HelenPenn

Visi*ngProfessor,TCRU,UCLIns*tuteofEduca*on

A diversion?

Anthropomorphism?

Wildlife Trust: Every Child Wild

Every Child Wild

•  “Eachgenera*onseemstohavelesscontactwiththeoutdoorsthantheprecedingone.Weoweittoallyoungpeopletoreversethistrend–fortheirsakes,foroursakesandfornature’ssake.”•  451childrenin12areasacrossEnglandbeforeandaNerpar*cipa*nginac*vi*esranbyawildlifetrustlikeiden*fyingplantsandtrees.•  “Thisresearchshowsthatchildrenexperienceprofoundanddiversebenefitsthroughregularcontactwithnature.Contactwiththewildimproveschildren’swellbeing,mo*va*onandconfidence.•  “TheWildlifeTrustsbelieveeveryoneshouldhavetheopportunitytoexperiencethejoyofwildlifeindailylifeandwe’recallingongovernmenttorecognisethemul*plebenefitsofnatureforchildren–andensurethatatleastonehourperdayisspentoutdoorslearningandplayinginwildplaces.”

My ideal nursery

My ideal nursery

•  Thecommunitynurserymovementwasbuiltonthepremisethat‘we’–thatis,everyoneinvolved,staffandparentsandchildrenalike–madedecisionsandactedtogethertodefineandpursuethenursery’sobjec*ves• Myidealnurserywasanearimpossible,cuUng-edgecombina*onofkindnessandconcernforthevulnerablecombinedwithintellectualsavvyandmorespacethananyhomecouldoffer.IwantedchildrentobejoyfultogetherbutnotisolatedintheirownchildhoodgheWo,tohavefriendships,torunandusetheirlimbs,tosavourtheeverydayeventsoftheirlivesandlivelifetothefull,includingexperiencingslipper-chewingpuppies,Chinesecuisine,scatologicalcuriosityandjunkyan*ques.

My ideal nursery

•  Ifchildrencometogetherinnurseries,howshouldtheirrela*onshipswithoneanotherbesupported?Andwhatshouldbetheroleandtasksoftheadultcaringforthem?Theseareper*nentques*ons,especiallynowthatsomanyyoungchildrenaWendnurseries,andtheyares-llunanswered.The‘quality’measurementscommonlyusedrefertostructuralquality(premises,equipment,staffing)andprocessquality(howindividualmembersofstaffsupportindividualchildren).Itisanextraordinaryactofblindnesstofailtoacknowledgethatinsitua*onswheremanychildrenandadultscometogether,theremightbeotherdynamicsopera*ng.

Issues of quality

• Purposefulac*vi*es,whosemeaningandrelevanceisconstantlyrevised• Parentsandstaffhavingavoiceinthedecisionmakingofthenursery•  Inclusivityforpoororvulnerablefamilies,andinclusivityforchildrenwithspecialneeds

Priva*za*onputstheseaimsunderstress.

UN: Poverty and Human Rights

• UN73rdGeneralAssembly(2018).ReportoftheSpecialRapporteuronextremepovertyandhumanrights.UNA/73/396•  TheUNreportdiscussestheimpactofpriva*zedservices,inalmostallserviceareas,notjustchildcare.Itsaysthatpriva*za*onacrosstheworldhasusuallymeanttwothings,firstlyalackofaccountability,andsecondlytheexclusionofthepoor.Thisisaworld-widephenomenon,notmerelyana*onalorlocalone,andisareflec*onofwhatiscalledtheglobaleconomicorderwhichprivilegesthewealthyattheexpenseofthepoor.Thegrowthofinequalityhasbeenthemajoreconomicphenomenonofthelast20yearsorso.

Private sector childcare in the UK/England

• Ourstudyaimstochartchangesinchildcareprovision,usingpublicallyavailableinforma*onaboutprivatenurseriestoexploreissuesoffinance,loca*on,con*nuity,transparency,accountabilityandgovernance.Wearecarryingoutareviewofthereachoftheprivatechildcareindustryusingmarketresearch,financialanalysisofselectednurseries,‘provisionmapping’toassesshowprovisionvarieswithdifferentlevelsofdepriva*on,andcasestudiesofprivateproviders.• hWps://www.nuffieldfounda*on.org/private-sector-childcare-england

The current size and shape of private childcare • Mostformalchildcareisprovidedbytheprivatesector,rangingfromsmallprivateoperatorstomul*-millionpoundinterna*onalbusinesses.Thefor-profitchildcaremarketintheUKisworthanes*mated£5.5billionpoundsandevidencesuggeststhefor-profitsectorisgrowingandconsolida*ng.Over80%ofallplaces,areprovidedbytheprivatesector,and53%ofthoseplacesareprovidedbybigcompanies.•  Thelargestthreechains,betweenthemprovidingover60,000places,areownedbyforeigninvestors,withfinancialheadofficeslocatedinSingapore,FranceandtheUSA.Furtherchangesinthesectorseemlikely,mostnotablyincreasedpenetra*onbylargechains,andincreasedforeigninvestment.

The current corporate nature of childcare

• Corporatechildcare,ornurserychainsnowprovide53%ofallplaces.Butthisisaveryvola*lesector,typifiedbycon*nualmergersandacquisi*ons,withthelargercompaniesbuyingupsmallerchains.•  Thetrademagazine,NurseryChainsannuallyranksthetop25childcarecompanieswiththemostnumberofseUngsandplaces.In1998thelistincluded70companieslisted.By2018thishadincreasedto179companies.Thecombinednumberofplacesonofferinthecompanysectorin1998was33,506.By2018thetop25companiesalonewereoffering110,271places,andthelargestcompanyalone,BusyBees,wasoffering31,514places.

The current corporate nature of childcare

•  Thecurrentgovernmenthasbeenac*velypromo*ngtheUKchildcaremarketasa‘globalopportunity’forinvestmentanditisnowbeingdescribedasa‘hotmarket’.Atthetopend,thereareconstantacquisi*onsandtakeovers,withlargecompaniesexpandingthroughpurchases,take-oversandrefinancingofsmallerchains.Thelargestthreechains,betweenthemprovidingover60,000places,areownedbyforeigninvestors,withfinancialheadofficeslocatedinSingapore,FranceandtheUSA.Furtherchangesinthesectorseemlikely,mostnotablyincreasedpenetra*onbylargechains,andincreasedforeigninvestment.

Chris-eandCo:EarlyChildhoodEduca-onandCareWorkforceTrendsandAssociatedFactorshWps://www.chris*e.com/getaWachment/News-Resources/Publica*ons/September-2019-(1)/Early-Childhood,-Educa*on-Care-Workforce-Trends-A/C-Co-ECEC-Report-(Pages)-(1).pdf.aspx/?lang=en-GB&ext=.pdf

InternaJonal childcare firms in the UK

•  BusyBeesNurseriesinEngland,Scotland,Wales,Ireland,Singapore,Malaysia,Vietnam,China,Australia,CanadaandtheUnitedStates•  ChildbasePartnershipNurseriesinEnglandandChina•  CognitaSchoolsNurseriesandpre-schoolsinEngland,Chile,Brazil,Spain,Switzerland,Italy,HongKong,Thailand,SingaporeandVietnam•  KangarooPouchNurseriesinEnglandandChina•  Evolou*onChildcareNurseriesinEngland,BahrainandChina•  KidoSchoolNurseriesinEnglandandUnitedStates•  Bri*shEarlyEduca*onNurseriesinChina

InternaJonal childcare firms in the UK

• BrightHorizons(HeadquarteredinWatertown,MassachuseWs,UnitedStates)-NurseriesintheUS,Canada,England,Scotland,Ireland,NetherlandsandIndia•  LesPe*tsChaperonsRouges(HeadquarteredinParis,France)–NurseriesinFrance,Germany,EnglandandCanada•  LaMaisonBleue(HeadquarteredinParis,France)NurseriesinFrance,Switzerland,Luxembourg,EnglandandRomania• HjalliModel(HeadquarteredinReykjavik,Iceland)NurseriesIcelandandScotland•  JiaYiEduca*on(HeadquarteredinChina)NurseriesinEngland

Sources of informaJon for the Nuffield Research Study on Childcare •  i)fromthesectoritself,andthebusinessandmarke*nginforma*onthattheyprovide•  ii)otherrelevantliterature,especiallyonstaffing,forinstancethereportbythelowpaycommissiononwagesinthesector.•  Iii)Forensicaccoun*ng.AlllimitedcompanieshavetosubmittheiraccountsannuallyintheUK.Whatdotheseaccountstellusaboutnurserybusinesses?Onememberofourteamisaforensicaccountantwhohasbeenexaminingtheaccountsofnurserycomanies.

Elder care privaJzaJon

•  Debtrepaymentsareasignificantareaofleakageforsomeofthelargest26providers.•  Theproblemisespeciallyseriousinrela*ontohomesoperatedbythe5largestfor-profitcarehomeproviderswhichareownedorbackedbyPrivateEquity.Collec*velytheirdebtsamountto£35,000foreachcarebedtheyown,andtheypayinterestcostsof£102perbedperweek;thismeansthat16%oftheweeklyfeespaidtotheseprovidersbylocalauthori*esorindividualsforresiden*alcaregoestowardspayingoffdebt.

•  6.Muchofthedebtloadedontothecarehomesbythelargestfor-profitprovidersisowedtorelatedcompaniesthatareoCenbasedoffshoreandathighratesofinteresti.e.aformofhiddenprofitextracFonwhichalsoavoidstax.

•  Acrossthe26largestcarehomeprovidersatotalof£261millionofthemoneytheyreceivetoprovidecaregoestowardsrepayingdebt.Outofthis£117million(45%)arepaymentstorelatedcompanieswhichisaknownwayofavoidingtaxandhidingprofits.

•  CHPI(2019)PluggingtheleaksintheUKcarehomeindustry.hOps://chpi.org.uk/wp-content/uploads/2019/11/CHPI-PluggingTheLeaks-Nov19-FINAL.pdf

Comment from inside the industry

•  Thegrowthofthecompanysectorhaschangedandthedistribu*onofnurserieshasshiNed,withmostinvestorsandownersfocusedonaffluentareasashigherfeescanbeachieved.No-onewillbuildindisadvantagedareasasthereisinsufficientsubsidyfromthegovernmentevenwiththepupilpremium.Therearealsosignificantsocialissueswhichcanbeverysignificantand*mecommitmentformanagerswhichalsomakesitlessaWrac*veandfeasible.Whenabusinessisacquired,italmostalwaysmeansafeeincreaseforparents.Inanaffluentarea,youmightgetprofitmarginsof35%;inlessaffluentareasitislikelytobe15-16%atbest.

Comment from inside the industry

• Asthecompanieshaveexpanded,theyareincreasinglyrunbymenwhofocusonfiscalperformancewhichgiventhefocusongenderequalityandthepaygapseemsironicinhighlyfeminisedindustry.Thesenewwell-paidMDshavenoexperienceofthesector,oroftheimpactoftheirrapidacquisi*ons.Theysteerclearofdisadvantage,oranykindofcomplexity,anddonotunderstandthatmanychildrenhavemul*pleneeds–andthatnotmee*ngthemisadisasterbeingstoredupforthefuture.Specialneedsarenotprofitable.Andtheprofitsarebeinggainedattheexpenseofstaffwhoareearningverybasicwages.

RecommendaJons for elder care

• Recommenda*on1:ATransparencyAct–carehomeprovidersshouldbemandatedtodisclosewheretheirincomegoes.• Recommenda*on2:Anewformregula*onisrequiredtopreventcarehomecompanieswithunsa*sfactoryfinancialmodelsfromprovidingcareintheUK.• Recommenda*on3:Capitalshouldbemadeavailablebythegovernmentfortheprovisionofnewnurseries.

RecommendaJons for Childcare

• Annualplansforeachnursery,whichmustbeagreedbystaffandparents;•  Introduceafeeceilingrelatedtohouseholdincome;•  Introducequotasforvulnerablechildren;•  Increasethepropor*onofqualifiedstaffifthenurseryistobegranteligible.• Broadenthemonitoringarrangementstoincludeownership• Putconcernfornatureandtheenvironmentatthecentreofthecurriculum