Investing in early childhood development (ECD) is crucial. What we know about brain development in the first 1,000 days of a child’s life shows an urgent need to ensure quality ECD services reach all children. Investing in the early years is not just about fairness and providing the best start in life for all children; there is also an economic imperative. If governments invest early in high-quality ECD services, the economy stands to benefit too – from reduced savings in social services to higher economic productivity of the population. Despite wide consensus about the importance of investing in the early years, one of the main obstacles to progress in this area is a lack of data on the actual cost of these quality services.
The Standardized ECD Costing Tool (SECT)
This is where the standardized ECD costing tool (SECT) comes in. Following a review of existing costing data and tools, we drew on the knowledge and experience of a multi-agency working group and an expert working group on costing ECD. With the feedback of these stakeholders, Brookings developed SECT as a way to bridge the gap between knowing what works, and how much it will actually cost. This was done in collaboration with the World Bank’s Strategic Impact Evaluation Fund (SIEF) and the Costing Working Group, in which the Inter-American Development Bank’s early childhood experts Florencia López Boo and Caridad Araujo had many inputs.
SECT, an important step forward for costing ECD, is flexible enough to cost the full spectrum of early childhood interventions, and to add rigor and consistency to a field that spans a range of sectors and stakeholders. The tool can be used to make the case for investment, through cost-benefit analysis, or as a way of supporting more informed investments, for example, to support budgeting or costed implementation plans at scale. The intended audience for the tool is broad since it could be used by government officials, private providers and investors, and other interested parties.
From Theory to Practical Use
Scenario 1: Cost-effectiveness Analysis
The state of Pernambuco in Brazil would like to know which of two parenting programs should receive funding. Policymakers could use the tool in a cost-effectiveness analysis of each of the programs to decide between them and evaluate which one achieves the outcomes at the lowest price.
Scenario 2: Cost-benefit Analysis
The Ministry of Education in Peru would like to make a case an evidence-based proposal to the Treasury that funding should be increased for pre-primary programs. Cost data would be compared to the financial benefit of pre-primary such as lower crime rates, reduced dependence on social welfare, and increased employment rates.
Scenario 3: Scale-up and Budgeting
There is interest in expanding a nutritional supplementation program through a public-private partnership in Colombia. SECT could be used to estimate the unit and scale-up costs of providing the program to help the government, potential donors, and service providers with budgeting and planning.
Scenario 4: Adding Components or Improving Quality in an Existing Program
The St. Lucia Ministry of Social Development would like to improve the quality of an existing home-visiting program by increasing training of service providers and home-visits. SECT could estimate the marginal cost of these additional components to the program and simulate the relationship between them, their cost, and outcomes.
What We Learned from Piloting SECT
We tested SECT across five very different ECD programs in Bangladesh, Mali, Malawi, Mexico, and Mozambique, and drew valuable lessons from each case. The pilot in Mexico was the only Latin American program in the mix and the only intervention funded and provided by the public sector. Conducted in two of 31 states where a community-based parenting program is provided, the pilot revealed challenges related to compilation of centralized and decentralized data systems, access to data on management and personnel costs and capacity within the government to analyze expenditures. It also drew needed attention to the distribution of expenditures in the program (for example direct delivery personnel vs. other personnel costs) which was found to be extremely valuable to the implementing agency.
Why Does This Matter?
Overall lessons from the development and pilot stages, including the tension between an ability to modify the tool and a certain level of automation to ensure consistency, will shape how it can benefit ECD stakeholders in the future. To increase the utility of SECT, ensure quality control, and facilitate centralization of cost data, these four recommendations will be crucial:
1. Support data collection, management, and accountability. To increase data quality, donors will need to work with governments and non-state providers to build their capacity to collect accurate and timely data on intervention costs.
2. Disseminate SECT. Ensuring the tool is widely disseminated will provide the opportunity to develop a rich and comprehensive database of costs across regions, program types, and delivery models.
3. Create a knowledge hub for ECD costing. The online hub would manage the tool, provide guidance to early users, and serve as a centralized data collection point to analyze the data.
4. Develop a SECT training module. This would provide users with the confidence to use the tool effectively and accurately, and would promote methodological consistency and understanding of the capabilities of the tool.
For more information on SECT, please contact ECDcosting@brookings.edu.
Photo credit: Julio Ortega/CONAFE