Local authorities are used to being handed targets for childcare places by the DfES, but under the Childcare Act they have a new duty - a broader commissioning role - to ensure that there is sufficient childcare for parents who work or undertake training before gaining employment.
The duty applies 'so far as is reasonably practicable', and in order for local authorities to judge whether they are meeting the sufficiency test, they will also have to assess childcare provision in their area at least every three years.
Patricia Jackson, head of regional development at the National Day Nurseries Association, says that this will require a substantial shift for some local authorities who will now have an obligation to consult with the private, voluntary and independent (PVI) sector.
'Now that local authorities have a market manager role, it's about understanding what is actually out there, and if they don't engage with the PVI sector then they are not going to meet sufficiency,' she adds.
She says involving the PVI sector is particularly important as Phase 3 of the children's centres, which will see them created in non-disadvantaged areas, is likely be done on a shoestring, with little capital and revenue.
The new duties for local authorities are being tested in a series of pilots under the Childcare Implementation Project (see 'further information').
The DfES says understanding demand and supply involves assessing:
* parents' needs, covering issues such as affordability, location, opening times, the particular needs of black and minority ethnic groups, and children with a disability or special educational needs
* employers' current and likely future demand for childcare, depending on the composition of the workforce and shift patterns
* current and future vacancies and location of supply across all sectors, unit costs, sustainability and quality of places and workforce supply and skills.
On track
Among the local authorities engaged in the 'supply and demand strand' of the CIP are Southampton City Council, Rochdale Metropolitan Borough Council and West Berkshire council, which worked closely on a sufficiency audit, then developed a gap analysis to establish where there were shortages of places.
Janet Scott, early years and childcare manager at West Berkshire, says the important lesson from the process was to use 'as many different ways of consulting as possible and not rely on one and then make sure you have got the sort of data that you can write up afterwards'.
Lin Clark, Children's Information Service and marketing manager at Southampton council, says that a telephone survey of parents provided a random sample and more robust information than an earlier paper-based survey.
She says that there are 'always going to be challenges managing a market that you don't own', but she adds that as a unitary authority and with a large development team working closely with nurseries, Southampton council 'knows pretty much what the supply and demand are'.
Another key aspect to managing the market is 'knowing what the impact of your decisions is going to have on other people' and, she argues, the continued existence of 'a very effective EYDCP' has ensured that all sectors are consulted.
Philip Blackburn, economist at Laing and Buisson, says that managing the local childcare market is not completely new and that EYDCPs have tried to do this for some time. He believes that instead of proposing a range of pilots, it would have been better if the Government used one successful local authority model and backed it with suitable funds to ensure its implementation.
Continuous funding
Providing enough money to enable parents to make the transition from training into employment has been a central issue in the London borough of Camden. Its childcare support fund, developed originally in 2001 with the support of the European Social Fund Equal programme to create the Better Childcare for Unemployed Parents (Bettercup) programme, also features in the CIP.
Satwat Rehman, childcare strategy manager for early years and Sure Start in Camden, says the fund has helped to ensure a continuous source of funds.
'In the past it was very stop-start. This resulted in additional barriers to parents because they kept having to find new sources of funding,' she adds.
She eagerly awaits the next set of guidance from Government relating to the market-managing role of local councils.
She says, 'We need levers for market management and it's hard to visualise what they can be. If the duty on sufficiency improves things for low-income parents and children with disabilities, then you need a mechanism, like the childcare support fund or some other form of subsidy, to ensure there is sufficient affordable childcare available.'
Lin Clark says that vital 'preventative' work is done in Southampton to ensure that nurseries remain viable, usually around business planning and tackling management and leadership issues before settings get into difficulties.
As the manager of the children's information service she takes calls from parents struggling to find a place for their child because 'a nursery has shut without notice'. She cites the example of one nursery, which the authority had worked closely with on quality issues, only to hear suddenly that it was to close.
'Obviously, we can't continuously bail out a business that is not working properly. We can help with sustainability before it reaches the point where a nursery closes and we have to deal with the fallout from that, but we need nurseries to let us know there are problems as early as possible,' she adds.
Patricia Jackson insists that PVI providers must also be pro-active in brokering relations with key people in their local authority. The NDNA has offered them support in the form of a one-day workshop entitled 'The changing childcare market'. She says that several local authorities have commissioned the workshop on behalf of their PVI providers.
The NDNA advises providers to club together in a group or a network 'so local authorities will listen, because they have a stronger voice and more clout'.
She adds, 'It is also easier for local authorities to communicate with a group rather than having to send letters to 260 providers.'
But she warns that if the mapping and auditing exercises to establish sufficiency mimic those used in deciding where neighbourhood nurseries and children's centres were sited, there will be further problems - many neighbourhood nurseries have proved unsustainable and the positioning of some children's centres has antagonised the PVI sector.
She concludes, 'Sufficiency should be treated as a journey, a process.
Local authorities should look at securing efficiency to reach sufficiency, and everything spells out the need to engage with the private sector.' NW '
Further information
* For details of the pilots being carried out under the Childcare Implementation Project, visit www.everychildmatters.gov.uk
Case study: Northumberland
Northumberland County Council was one of the 12 local authorities to take part in the 'facilitating the market' pilots in the Childcare Implementation Project. It commissioned several surveys by consultants and the preliminary results give a snapshot of some of the key issues local authorities need to confront in managing the market.
The surveys found that:
* 22 per cent of group providers and 29 per cent of childminders say they are operating at high levels of occupancy (over 90 per cent), while 25 per cent of group providers and 26 per cent of childminders have occupancy of 50 per cent or less
* 97 per cent of full daycare providers report vacancies. In group provision generally, 85 per cent report have vacancies, while in childminding the vacancy rate is 56 per cent. On average 36 per cent of childminders take three or more months to fill a vacancy, compared with 26 per cent of group providers.
* 69 per cent of group providers and 56 per cent of childminders feel there is sufficient childcare for parents.
* About one third of group providers and childminders are not confident of their sustainability for the next couple of years and many feel left out of plans for extended schools and children's centres
* 40 per cent of group providers and 25 per cent of childminders indicated that they need more support to meet the needs of children with 'specific requirements'.
