Private nurseries in poorer areas should use extra government cash to hire graduates in a bid to raise standards, research released today has shown.

A University of Oxford study revealed that private, voluntary and independent (PVI) nurseries were worse in poorer areas than their counterparts in wealthy parts of the country, whereas state-funded preschools were as good, if not better, than those serving richer catchments.

The report, called Quality and Inequality and published by the Nuffield Foundation, found that where PVI nurseries employed a graduate, the “quality gap” was much smaller between rich and poor areas.

The results led to researchers to call on providers and disadvantaged areas to use the new early years pupil premium to hire more staff with a degree.   

The research comes after Sir Michael Wilshaw, chief inspector, warned that too many nurseries were not preparing children for school and it was the poorest children who were most likely to miss out on early education.

Sir Michael urged schools to become more involved in early years to ensure children were better prepared for the start of school.  

The study, led by Sandra Mathers, a senior researcher at Oxford University, looked at data from 1,079 PVI nurseries and 169 maintained nurseries, using Ofsted grades and Early Childhood Environment Rating Scales.

Ms Mathers said: “This research highlights the challenges involved in ensuring that the children who most need good quality early years provision actually receive it.

“It is vital that we equip nurseries and preschools with the tools and support they need to help disadvantaged children overcome the odds and reach their full potential.”

When looking at how well children’s language skills were supported, for example, the researchers found that children attending PVI settings in the most deprived areas scored on average 9 per cent lower than those in the least deprived areas.

Language development is particularly important for later school success and the report states: “Our analysis does indicate that the children most in need of good quality support for language and literacy are least likely to receive it, at least within the PVI sector.”

Purnima Tanuku, chief executive of National Day Nurseries Association, said the majority of nursery provision was rated “good” or “outstanding” with experienced staff trained in early years development.

But she added: “Funding is a key issue for nurseries providing free entitlement with each place losing nurseries on average more than £900 per child per year. This makes it a challenge for providers, particularly in areas where local authorities are paying very little per hour for free entitlement, to afford to employ graduates.”

To overcome these issues the government needed to look at overhauling the whole funding system and make sure the money for free entitlement was ring-fenced with the full amount going to frontline staff, she said.

“It is to be hoped the pupil premium, when it comes into force, will go some way to helping nurseries in disadvantaged areas close the funding gap and employ more qualified staff,” Ms Tanuku added.