A groundbreaking new report from the National Academies of Science, Engineering, and Medicine concludes that “high-quality early care and education (ECE) for children from birth to kindergarten entry is critical to children’s positive development, but it has been financed in such a way that it is only available to a fraction of the families who need and want it.”
The National Academies convened a committee of experts to study how to fund ECE that is accessible, affordable for families, and of high quality. In its report, Transforming the Financing of Early Care and Education, the committee concludes that “transforming the financing structure for ECE to meet the needs of all children and families will require greater coordination among financing mechanisms, as well as significant mobilization of financing and other resources across the public and private sectors.”
According to the report, “financing for ECE in the United States today is a layering of separate programs with different funding streams, eligibility requirements, and quality standards. The financing structure places a large burden to pay for early care and education directly on families in the form of fees and tuition, making high-quality ECE prohibitively expensive for many families.”
The report goes on to make estimates about the overall cost of comprehensive, high-quality child care in America:
“The flaws in the current financing structure are exacerbated by overall low levels of funding that are not sufficient to enable families at all income levels to access high-quality services… Once fully implemented, the committee’s illustrative estimate is that the total cost of providing high-quality ECE for all children is at least $140 billion per year (from all sources public and private), equivalent to about three-quarters of 1 percent (0.75%) of U.S. gross domestic product, or slightly less than the current average of 0.8 percent of GDP allocated to ECE for the nations in the OECD.”
Ultimately, the report offers specific recommendations for making ECE more affordable for families, linking funding to high-quality standards, and financing the transformation of the ECE workforce.
One specific recommendation makes clear that public funding should be tied to high-quality care:
“Federal and state governments should establish consistent standards for high quality across all early care and education (ECE) programs. Receipt of funding should be linked to attaining and maintaining these quality standards. State and federal financing mechanisms should ensure that providers receive payments that are sufficient to cover the total cost of high-quality ECE.
“To realize the considerable potential benefits of ECE, an integrated framework of laws and policies that uses financing to bring about an accessible, affordable, and high-quality ECE system should be implemented. The financing structure should include adequate and integrated funding for service delivery, workforce supports, and system supports, including mechanisms for accountability and improvement. It should also provide flexibility to reduce silos and facilitate nimble and efficient coordination of funding streams, standards, and requirements from disparate sources.”