Why should we invest in Early Childhood Education and Care?

There are large gaps in skills between children from different backgrounds by the time they start school. For example, nationally representative data from the Millennium Cohort Study shows that less than one in ten individuals from the poorest 20% of families are identified as being in the top quintile of cognitive development at age 3 compared to around a third of individuals from the richest 20% of families. There are similarly large gaps in socio-emotional development as well (Cattan et al., 2022). One reason for this is the different environments they experience in their pre-school years, with children from disadvantaged backgrounds less likely to access high-quality early childhood education and care (ECEC) provision and less likely to be exposed to rich home learning environments, both of which contribute to children's development (Cattan et al., 2022; Cornelissen et al., 2018). For example, less than three quarters of disadvantaged 2-year-olds take up their entitlement to 15 hours of free early education per week during term-time, and even amongst those who access some of their entitlement, not all children access the full 15 hours available each week (DfE, 2022). At the same time, accessing high-quality ECEC provision is challenging for some families, especially before age 3, because fees are high and financial support is limited. This may hinder children's development, particularly for those from disadvantaged backgrounds, but is also likely to limit parents' – especially mothers' – ability and incentive to work, holding back productivity at a time of high labour demand and skills shortages. This briefing note summarises the evidence underlying the case for investment in high-quality ECEC provision. It also explores the more limited evidence on the amount and type of investment that could provide the greatest return.