Nurseries at ‘crisis point’ over doubling of free care

Lack of funds mean only one-third of private centres likely to offer extra hours

SOARING costs and low fees have left Scotland’s private nursery sector at “crisis point” – threatening a flagship SNP policy to double free childcare hours by 2020, a new report warns.

The Scottish Government has promised to increase nursery hours for all three and four-year-olds, however, funding problems within the private sector mean the key pledge is beginning to unravel.

But, according to the National Day Nurseries Association (NDNA), less than one-third of private centres are likely to offer the extended 1,140 hours due to inadequate fees from local authorities.

With private nurseries needed to take on a greater role due to the scale of the SNP scheme, the Government is now being urged to take immediate action to help the sector, which is already at “crisis point”.

In a report on its annual nursery survey, published today, the association states: “With many nurseries struggling to make ends meet for the current 600 hours, respondents expressed real concern as to whether they will be able to deliver the extended entitlement, let alone make it to 2020. They need action now, otherwise the 1,140 hours programme will not work.”

The survey revealed almost 80 per cent of NDNA members say current funding for three and four-year-olds does not cover their costs, with the average nursery having to absorb £1,188 per child each year.

There are also concerns over the requirement to pay staff the real living wage when margins are so tight.

NDNA chief executive Purnima Tanuku said: “NDNA has uncovered the true predicament that nurseries in Scotland find themselves in and it has reached a crisis point.

“Private nurseries just don’t feel confident that sufficient funding will be passed on to providers by local authorities to make it worthwhile for them to deliver the full 1,140 hours’ provision.

“Although we welcome the Scottish Government’s ambitions to give all children the best start in life, the sector needs to see the policy given priority and sufficient resources behind it for it to be a success.”

The report comes after financial watchdog Audit Scotland also warned of “significant risks” around the policy and said it was “difficult to see” how the 2020 deadline could be met.

In a scathing report published in February, it catalogued a series of problems with infrastructure and staffing, and disagreements with councils about how much it will cost.

Since then, the Scottish

Government has announced a near£1 billion funding package with the Convention of Scottish Local Authorities (Cosla) which it said will “significantly increase rates”. However the NDNA claims there are still major concerns.

Ms Tanuku said: “The problem that exists now is that the Government has announced funding,which is going to be passed on to local authorities, and at the moment they’re giving private providers very little to deliver high-quality care.

“What we need to know now is how the Government is going to police the funding to make sure local authorities are treating all providers – both local authority centres and private providers – equally.”

She added private nurseries still have no informa- tion on what the new rate will be and are being asked to sign up to the 1,140 hours scheme without knowing the full details.

The NDNA survey – which revealed that just seven per cent of providers are currently able to meet the new provision – showed that more than three-quarters said a better funding rate would enable them to sign up.

A Scottish Government spokesman said: “Since this survey was carried out, the Scottish Government has agreed a landmark near £1 billion funding package with Cosla that provides for local authorities to offer fair and sustainable funding rates to private and third sector nurseries.

“This will significantly increase rates across Scotland and enable all childcare workers delivering the funded entitlement to be paid the Scottish living wage.”