Child care sector fears cash crisis

One in four childcare providers fear they will be out of business within a year because of the COVID-19 pandemic, a survey suggests.

Nearly three in four – 74% – of nurseries, pre-schools and childminders feel that the Government has not provided enough support to them during the coronavirus crisis, according to a poll by The Early Years Alliance (EYA).

Childcare providers say they could be forced to make staff redundant, ask parents to still pay fees, or close their doors permanently.

The online survey of 3,167 childcare providers, found that 47% may need to make staff redundant and 21% may need to retract offers to waive or reduce fees.

Last month, guidance from the Department for Education (DfE) said they would limit the circumstances under which childcare providers can access financial support from both the "free entitlement" funding scheme and the coronavirus job retention scheme.

Neil Leitch, chief executive of the EYA, said: "The recent last-minute U-turn on the support that childcare settings can receive for furloughed staff in particular has had a hugely negative impact on the sector and, if not reversed, is likely to contribute to many avoidable redundancies and, in some cases, permanent closures.”

A DfE spokesman said: "We have provided continuity in funding for the free childcare entitlements, and the Government has put in place a significant package of financial support for providers. This principle applies universally across all sectors."