Small world means so much for toddlers: Independent report warns that state schools serve minority of ablest pupils but are failing vast majority

EVERYTHING IS touchingly miniature at Vassall Road play group in Lambeth, south London, from the little people who attend to the scale-model kitchen, complete with front-load washing machine, and the dozen desks and chairs set up for sponge-paint printing, writes Mary Braid.

In a neighbourhood of sprawling housing estates and anonymous concrete blocks, this small, bright, open-plan building, one of the country's 20,000 pre-school playgroups, provides a safe, enriching environment for 40 under-fives from one of London's poorest boroughs.

But at Vassall, it is the same old nursery-education story. Demand for places far exceeds supply. More than 100 children are on its waiting list.

'By the age of two or three, children need something more structured, but there just aren't enough pre-school playgroup places around,' Jilly Hales, chair of the playgroup committee, said. Her three-year-old daughter, Lucy,

attends Vassalls.

'A private nursery school place would cost pounds 1,300 a year. Most families around here could not afford that. We charge pounds 1 for a morning or afternoon session, pounds 5 a week. Last year, Lambeth cut our grant, so we had to double our charge and some children had to drop out. Even pounds 5 a week can be too much if you are on income support or you have more than one child here.'

At Vassalls it is a never-ending struggle for money. Lambeth gives pounds 16,000 a year and the committee raised pounds 2,000 through fetes and sales last year. The nursery was recently redecorated for the first time in 12 years, but that was only possible with a special donation from the BBC's Children in Need fund. A special government grant also allowed safety-cladding of the small yard. Such grants have now been suspended. 'In a poor area like this, fund-raising doesn't bring much in,' Mrs Hales said.

Small budgets also mean poor wages. Joan Dixon, playgroup leader, and her assistant, Sharon Price, 33, both earn about pounds 3 an hour, which, they say, reflects the poor standing of nursery education. Mrs Dixon, a former shop manageress, says you have to love the job to carry on.

At least one-fifth of places are reserved for children referred by social services and for homeless or deprived families. Early behavioural or development difficulties are picked up quickly. But Mrs Dixon says every child benefits from pre-school education - and she would like every child to have the chance.

(Photograph omitted)