It says there has been a decline in the number of playgroups and other pre-school places from a peak of about 18,000 in 1991 to about 15,700 in 1999.

Some parents feel pressurised into seeking a reception place early

The report, Tomorrow's Children, acknowledges that there is conflicting evidence about what makes parents choose a particular place for their children - but the over-popularity of some schools is a factor.

"Our own consultation exercise suggested that some parents feel pressurised into seeking an early reception class place in order to secure a place at their preferred primary school," it says.

It wants admissions policies to "reflect what is in the best interests of the child", with better promotion of the option of deferring entry to school, as set out in the government's code of practice on school admissions.

That code says: "If a parent is offered and accepts a place during the normal admission round but asks to defer their child's entry to school until he or she is of compulsory school age, the admission authority may agree to the parent's request provided the place is taken up within the same academic year.

"The effect is that the place is held for that child and is not available to be offered to another child."

'No pressure'

In its response to the report, the government says that a quarter of local education authorities do this.

"There should be no question of schools putting pressure on parents to enter their child early in order to secure a school place," it says.

The childcare review was ordered by the Minister for Employment and Equal Opportunities, Margaret Hodge, back in March. She said then: "I am concerned to hear about the number of playgroups which are said to be closing."

There had been increasingly strident complaints from private and voluntary nurseries and playgroups of unfair competition from schools setting up nursery classes.

Anomalies in the rules mean that higher minimum staffing ratios are required for pre-schools, childminders and nurseries than for school reception classes catering for children of the same age. Some providers are subject to more than one form of regulation.

The review says that moves to improve the staff ratios in reception classes in some areas are welcome, and it "would encourage consideration of this becoming a statutory requirement in due course".

The government accepts this in principle and says it is moving towards "a more level playing field".

Admissions policies

The review says school admission policies have also had a major impact. The trend towards having a single intake each year "has significantly reduced the number of funded four-year-olds using pre-schools and playgroups in the autumn term."

The review panel recommend that financial incentives for schools to recruit children early should be removed as part of a funding shake-up.

They also want a return to two or more admission times during the school year.

"This would enable pre-schools/playgroups and other providers to attract four-year-olds eligible for funding in every term and thereby offer a more secure funding environment," they say.

The government is sceptical but says it will reconsider the funding arrangements.

The review says playgroups also need to do more to help themselves. It says the more informal ones should be encouraged to volunteer for some form of quality assurance system.

And it says all groups should explore ways of extending the range of services they offer.

Better qualifications

Among its 55 recommendations, the review also argues for "an ambitious strategy" to have all pre-school settings led by staff with at least a degree qualification.

As the report was published, Mrs Hodge called it a "thoughtful and wide-ranging contribution to ensuring that pre-schools will continue to play their role in the future."

"The government recognises the need to expand the number of graduate level, or equivalent, early years practitioners in leadership roles in the future," she said.

"We are also working closely with the Qualifications and Curriculum Authority to ensure that the training needs of those implementing the Early Learning Goals are being met.

"We are also committed to ensuring that all children receive provision that is both appropriate and of the highest quality. ... What is important is that parental choice is encouraged and that all children make a flying start in their lifelong educational journey."