The case for looser childcare ratios rests on confusion

The government claims to want to reduce costs and increase quality. It can't have it both ways.

This morning’s announcement on childcare ratios should be just the hors d'oeuvre before the government sets out its plans to increase childcare support for parents. According to the latest rumours, it now looks likely that the majority of any new money will be spent on tax relief for higher income households, making this a potentially important political moment. For now, though, today’s announcement merits some serious attention. Nursery workers are to be allowed to look after six two-year-olds at a time, up from four today, while childminders will be able to look after four young children, up from three today. Any provider wanting to use these new ratios will have to meet new quality standards, though the government is yet to set out what these will be.

These are fairly big changes and the government’s case for them rests on a number of confusions. First, the argument for relaxing ratios has gradually shifted from an emphasis on reducing costs to one of increasing quality. In some ways, this is an admirable shift to a more defensible position. Now, though, the government wants it both ways. On the one hand, briefings have claimed that ratio changes will free up money for investment in staff, raising pay and qualifications. On the other, looser ratios are intended to reduce childcare costs. This double counting might be ok if new ratios would free up large sums of money in a competitive and smoothly-functioning childcare market. But with many childcare providers already struggling to stay afloat, and with the market for childcare all but broken, this seems unlikely. The government needs to clarify what it wants looser ratios to achieve.

Second, there is the appealing idea that childcare ratios are tighter in the UK than in other countries and that this ‘over regulation’ can explain our sky-high childcare costs. Yet these variations in ratios rarely reflect the reality on the ground. In France, for example, the government cites a ratio of eight one-year -olds per member of staff. Yet academics argue that a ratio of 4:1 is more common. And nor is this a simple case of disputed data. While some aspects of the childcare debate do lack good evidence, there is a strong consensus among practitioners about the appropriate ratios for different ages of children. While the Department for Education may point to varying ratios rules, the UK does not appear to be an outlier in practice. It’s doubtful that ratios are the main explanation for high costs.

Third, there is the idea of a simple trade-off between staff quality and ratios. This allows the government to say it wants "to shift the debate away from quantity towards quality". Of course training matters greatly, but ratios are an important dimension of quality in their own right. This is partly because very young children learn by interacting with adults and need close attention; no amount of training allows a nursery assistant to give one-to-one time to more than one baby at once. But it’s also because the ratios debate ignores the reality of a room full of two year olds. In practice, a 1:4 ratio doesn’t mean one nursery assistant sitting calmly with four children. It means one nursery assistant dealing with a two year old having a meltdown while the other watches over the remaining seven. As one childcare provider put it at a recent Resolution Foundation event, "I don’t have enough laps and hips to calm down four two year olds as it is – I don’t know how I’d cope with six".

These confusions help to explain why today’s proposals have received short shrift from most parent groups and providers. In practice, this opposition might well be their saving grace – it wouldn’t be surprising if very few providers take up the offer of looser ratios. And even this will need to await a government consultation on what exactly the new quality requirements will mean. If international experience is anything to go by, let’s hope this is the case. The Netherlands gives us a good example of what happens when you relax childcare ratios: when this choice was made there, in the mid-2000s, the quality of childcare fell. It’s an important warning of the consequences of not paying due attention to the evidence.

James Plunkett is director of policy and development at the Resolution Foundation 

David Cameron is pictured during a visit to a London Early Years Foundation nursery in London. Photograph: Getty Images.

James Plunkett is director of policy and development at the Resolution Foundation

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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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