Government urged to reconsider Early Intervention Grant changes

The future of early intervention is under threat. Following a series of revelations earlier this month, the Department for Education (DfE) has confirmed that the Early Intervention Grant will cease to exist in its current form from 2013.

Instead, the majority will be incorporated into mainstream local authority funding, while the DfE plans to retain £150m centrally in 2013/14 and 2014/15 for “future use in funding early intervention and children’s services”.

Money allocated to financing free nursery places for two-, three- and four-year-olds will be rolled into the Dedicated Schools Grant. This includes £534m in 2013/14 and £760m in 2014/15 to expand the free entitlement to disadvantaged two-year-olds – money some councils had hoped would be provided in addition to existing early intervention funding – not instead of.

Details of the changes were included in a business rates retention technical consultation document published by the Department for Communities and Local Government (DCLG) in July. But many children’s services providers failed to spot the relevant particulars on page 140 of the document, until the Local Government Association (LGA) published its response to the consultation last month.

The changes spell uncertainty for services ranging from children’s centres and short breaks for disabled children to youth work and counselling for teenagers.

Graham Allen MP, author of two government reports on early intervention, has written to Prime Minister David Cameron urging him to reconsider the plans.

He warns that the Early Intervention Grant has already been reduced by 23 per cent since 2010 and estimates that the level of funding likely to be given to councils for the financial year 2013/14 will equate to a further 17 per cent drop – if you take into account the cash earmarked for the free entitlement.

“It is utterly inevitable that without dedicated funding, early intervention funding will fall as councils struggle to fund the basics,” he says.

‘Economic folly’

“At a moment when political commitment and momentum is swinging behind early intervention; when huge savings on the grotesque late intervention budget are about to be realised by the public purse, and the social investment market is about to take off, such a move would not only be economic folly but would fly in the face of the express political position to build up early intervention.

“We hope the government will look at this again, otherwise it will be turning the rhetoric, which has been very strong and positive, into a lie. The problem is local authorities are being asked to do so many statutory things. They will have to do those first so the discretionary things will get squeezed out.”

Richard Watts, executive member for children and families at Islington Council, says the changes mean the authority will be facing a £3m cut in funding for early intervention in children’s services, which the council is trying to make up from other departments.

“We’re going to look at how we can manage that all across the council, not just children’s services. But that will lead to a number of difficult decisions,” he says. “Other councils may not make that decision and some services that are trying to support families and do early intervention are going to be lost.”

Watts argues that government rhetoric about giving local authorities flexibility to make their own decisions is being undermined by the changes to the way early intervention money is allocated.

He also suggests the lack of clarity around the funding is costing councils money. “It would have saved us money if we’d known from the start and given us more time to plan,” says Watts. “Now it’s very late in the day. It’s making it much more difficult for councils to plan how they will protect vital services.”

Clarification needed

His complaint is echoed by Matthew Downie, head of parliamentary and public affairs at Action for Children, who says the government must clarify its position as soon as possible.
“At the very least, we need a clear statement about what’s happening, because when it comes to delivering services for children and young people, the worst thing is instability,” he says.

Anne Longfield, chief executive of 4Children, says the government must find other ways to protect spending on children’s services.

“They need to look at new ways to help local authorities to make positive decisions about early intervention, such as a statutory duty on early intervention,” she suggests. “There has to be a central government responsibility to put a focus on intervention.”

Neil Leitch, chief executive of the Pre-school Learning Alliance, admits that early years providers will face less uncertainty than others in the sector, given that funding for the free entitlement has been guaranteed as part of the Dedicated Schools Grant.

But he says he would never have supported plans to expand the free entitlement to two-year-olds had he known it could compromise other early intervention programmes, adding that the changes to the grant have damaged his confidence in the government.

“If you can’t protect something as critical as early intervention, then I’m not sure we should have any faith in any of the budgets that are allocated,” he says. “I think it sends out an appalling message to communities that even fundamental areas of support are at risk. With welfare cuts coming on board, there’s nothing that says to me that it’s going to get any better.”

A statement from the LGA says that individual councils will have to wait until December to find out exactly how much early intervention cash they will receive, when the local government and schools funding finance settlements come out.

But the association claims there is no justification for DfE plans to retain £150m of the funding – and that this “risks under-resourcing local authorities in delivering targeted early support to children, young people and families that need it most”.

The LGA also believes that moving the money for free nursery places into the Dedicated Schools Grant is “counter-productive and will lead to significant cost pressures in the longer term”.

The DCLG has told Allen that it will consider further written responses to the business rates retention proposals until the end of the month, although the formal consultation period has closed.

Meanwhile, the DfE plans to publish its response to the business rates retention consultation “in due course”. 

Either way, children’s services providers must prepare for a future where early intervention is just one of many competing priorities fighting for a slice of mainstream local government funding.

PLACE2BE: FUNDED BY THE EARLY INTERVENTION GRANT

Mick Atkinson, head of commissioning, Place2Be

“Place2Be is an early intervention emotional and mental health service in schools. We support 64,000 children in more than 170 schools in the UK’s most socially deprived areas, and their parents, carers and teachers.

We receive funding from schools and the public and private sectors, and are about to benefit from the Early Intervention Grant in Lewisham.

On average, 65 per cent of the children we work with improve psychologically as a result of our intervention. Our teams of counsellors provide one-to-one support for children. We also offer drop-in services for children with lower-end difficulties.

If you don’t invest in early intervention, society pays the debt later. We conducted a cost-benefit analysis, supported by the Bank of England and the London School of Economics, based on the long-term costs of mental health. We found that for every £1 invested in Place2Be, we save society £6 from future costs of a child’s mental health needs in adulthood.

Cutting early intervention mental health services would have a direct impact on the lives of these children, as well as on schools. If services like ours aren’t there to provide support to the children who need it, this affects the whole school population. It also affects teacher turnover and the school’s academic results.

The children we support are often also accessing other Early Intervention
Grant-funded services, so cuts would hit them from multiple sources. It’s not unusual for up to 80 per cent of the children we support to be eligible for free school meals. High numbers are also known to social care and are on the child protection register.”