It’s false economy to scrap the Early Intervention Grant

The rumours about the Early Intervention Grant have now been confirmed. The government is scrapping the ringfenced £2.4bn grant, which has to be spent by local authorities on early intervention services like parenting services and children’s centres. Instead, £300m will go to fund free nursery education for two-year-olds from poor families, £150m will be held by central government for spending on early intervention initiatives, and £1.7bn will go into the general funding pot for councils.

The government is arguing this doesn’t represent a cut in funding for early intervention services. But there are two major issues with this move.

First, it should never be an either/or between high-quality free nursery education and other early years services. Research shows that high-quality daycare settings improve children’s outcomes – but quality is key; being in lower-quality childcare has little or no positive impact. Yet as my research at Demos has shown, you are twice as likely to find inadequate childcare in the poorest areas than the richest areas. In times of scarce resource the priority should really be increasing the quality of settings for poor three- and four-year olds, by boosting the qualifications of early years professionals, rather than by spreading the offer without the all-important emphasis on quality of setting. And to fund an expansion in the offer by cutting funding for early intervention is simply taking with one hand and giving with the other.

Second, removing the ringfence on the remaining £1.7bn that will go to local authorities will undoubtedly result in a dramatic drop in aggregate spending on early intervention services. The Social Research Unit’s Investing in Children cost-benefit data highlights the taxpayer savings that can be realised by investing in a range of early intervention services, such as the Family Nurse Partnership, Functional Family Therapy and Reading Recovery. The data show many evidence-based, early intervention programmes have the potential to generate significant long-term savings for the state as a result of preventing problems that are more expensive to deal with downstream. But, both because these savings take time (and effort in terms of reconfiguring services) to realise, and because taking the decision to decommission existing services that may be ineffective is difficult, it is rare that significant amounts of resource are shifted to early intervention. This is particularly true when local authorities are already having to make significant cuts. It is unlikely the £1.7bn won’t be used to plug the gap in other areas.

That is why although decentralisation is usually a good rule of thumb, it’s so important to have a ringfence for early intervention services for children. It recognises that there are institutional and political barriers that mean even the most well-meaning local commissioners are likely to under-spend on early intervention. The Early Intervention Grant was a small but significant boost to help local authorities take a smarter approach to children’s services. Removing it is a big step backwards.