Free childcare for 3-year-olds: no long term benefits for child development

22 October 2014

A report presented to the House of Lords today reveals that free part-time nursery places for three-year-olds enabled some children to do better in assessments at the end of Reception, but overall educational benefits are small and do not last.

The research, by the University of Surrey, University of Essex and the Institute of Education found that the policy has relatively small benefits for children’s development overall, primarily because only a small number of additional children entered early education as a direct result of the policy. The research was funded by the Nuffield Foundation and the Economic and Social Research Council’s Secondary Data Analysis Initiative.

The analysis focused on children in early education from 2002-2007 in England, relating the local availability of free places for three-year-olds to children’s attainment at ages five, seven and eleven. Free nursery places were shown to have a small beneficial impact at age five, but the size of the effect declined by age seven and disappeared by age eleven.

Between 1999 and 2007, the proportion of three-year-olds in England benefitting from a free nursery place rose from 37% to 88%. However, the team found that for every six children given a free place, only one additional child began to use early education. For the other five children, the policy gave parents a discount on the early education that they would have paid for in any case.

While there was modest evidence that the policy had more impact on the poorest, most disadvantaged children, the research showed that the policy did not close the gap in attainment between those from richer and poorer families in the longer term.

"While previous research has suggested that early education is key to long term attainment, our research has shown that the free entitlement did not deliver the anticipated gains," said Dr Jo Blanden, Senior Lecturer in Economics at the University of Surrey.

"On the face of it, our results cast some doubt over the value for money of universal early education. More than 80% of the children taking up free places would probably have gone to nursery anyway, and the policy had no educational benefits in the longer term. This might be because the extra pre-school places were not of high enough quality. Recent research shows that state-run nurseries are of more consistent quality, whereas this policy encouraged greater use of privately run places. Alternatively, it could be that primary schools do very well at helping children reach their potential, meaning that pre-school experience is not important."

Dr Birgitta Rabe, Senior Research Fellow at the Institute for Economic and Social Research, University of Essex said: "It is tempting to say that the money would have been better spent on the poorest children. However, the policy’s universalism may have benefits if it encourages greater take-up of provision among children from more disadvantaged backgrounds or if it mixes children from different backgrounds in the same early education settings."

"In this context, it might be more appropriate to see the free entitlement as a form of child benefit, and the policy debate should reflect this," Dr Rabe added.

A parallel research project, undertaken by a different team of researchers, examined how the free entitlement affected mothers' labour market performance.

A briefing note, The impact of free early education for 3 year olds in England, summarises the findings and implications of the two projects.

Full details can be found in the following paper:
Evaluating a demand-side approach to expanding free pre-school education by Jo Blanden, Emilia Del Bono, Kirstine Hansen, Sandra McNally and Birgitta Rabe.


1. In 1998, the previous Labour government announced that three- and four-year-olds in England would be entitled to a free part-time nursery place, to be taken either at a state-run nursery or a private or voluntary sector provider (most often a day nursery or playgroup). The policy became universal across England for four-year-olds by 2000, but expanded more slowly for three-year-olds, becoming effectively universal across England by 2005.The free entitlement to early education was initially for 2.5 hours a day (12.5 hours a week) for 32 weeks a year, and it has been expanded so that it now covers 15 hours a week (which can be taken flexibly over fewer days) for 38 weeks a year. The policy has been estimated to cost around £1.9bn a year for three- and four-year-olds in England (National Audit Office, 2012), and the analysis relies only on English data.

2. The research effectively compared changes in the later educational outcomes of three-year-olds from areas which saw large increases in free early education places during the 2000s, with areas that saw much smaller increases. The research controls carefully for other factors which might have changed at the same time as the places increased. The data used is from the National Pupil Database from 2003-2008 and the researchers use information on more than one million English school-children. The small effects found are therefore very precisely estimated. Impacts at age five are measured in terms of the Foundation Stage Profile, an assessment completed at the end of Reception which has a maximum score of 117 points.