A House of Lords Committee on Affordable Childcare is calling for a radical rethink in childcare funding to ensure disadvantaged children are prioritised.
They want the next government to use more of the forecasted £6.4bn early education and childcare budget on those most in need.
The committee also called for an assurance that by 2020 all disadvantaged two-year-olds have access to free early education in settings that achieve the highest Ofsted ratings.
Committee chairman Lord Sutherland of Houndwood, said: “The evidence clearly shows that high-quality early education has a crucial role to play in helping disadvantaged children to reach their full potential. For this group in particular the impact can be substantial. We are not talking about increasing budgets. We are talking about a re-prioritisation of current spending to ensure that it targets those children who are likely to benefit the most.”