Nurs­ery fees rise as free child­care scheme back­fires

Fund­ing for flag­ship Tory pol­icy is too low to cover the costs, say providers

The Observer - - News - Donna Fer­gu­son

More than half of pri­vate nurs­eries have in­creased their fees in the past year, and ex­perts pre­dict fur­ther rises are on the way as nurs­ery own­ers struggle to make up the short­fall caused by in­suf­fi­cient fund­ing for a flag­ship govern­ment pol­icy.

Official fig­ures, pub­lished by the Depart­ment for Ed­u­ca­tion (DfE) and an­a­lysed by Labour, show 53% of pri­vate nurs­eries in Eng­land have put up their fees in the past 12 months, along with around a quar­ter of school nurs­eries (28%) and child­min­ders (25%).

The wide­spread fee in­creases fol­low the im­ple­men­ta­tion in Septem­ber 2017 of a Con­ser­va­tive man­i­festo pledge al­low­ing work­ing par­ents of three- and four-year-olds to claim 30 hours of child­care a week dur­ing term time (38 weeks a year) for free, even if each par­ent earns up to £100,000.

Nurs­eries and child­min­ders re­peat­edly warned that the level of govern­ment fund­ing al­lo­cated was in­suf­fi­cient and would force many child­care providers to raise fees, charge par­ents for “ex­tras” they didn’t pre­vi­ously charge for – or go bust.

The DfE re­search sug­gests at least half of the par­ents who took up the of­fer, be­liev­ing they would re­ceive free child­care, are now be­ing asked by their provider to pay ad­di­tional charges, such as for lunches, snacks, and out­ings. Even ex­clud­ing th­ese charges, 48% of par­ents el­i­gi­ble for the fund­ing are still hav­ing to pay at least some fees each term: £76.50 per week on aver­age. Among th­ese par­ents, one in seven (15%) are ac­tu­ally spend­ing more on child­care now than they did be­fore their child started re­ceiv­ing so-called free hours.

Neil Leitch, chief ex­ec­u­tive of the Pre-school Learn­ing Al­liance, which rep­re­sents nurs­eries, said he was not sur­prised child­care providers were putting up their fees. “Sys­temic un­der­fund­ing has left many providers strug­gling to break even, forc­ing them to choose be­tween in­creas­ing fees and risk­ing clo­sure. And, with the na­tional liv­ing and min­i­mum wages set to rise next April, this fi­nan­cial pressure is only go­ing to get worse.”

The re­search re­veals it is pre­dom­i­nantly bet­ter-off fam­i­lies who are ben­e­fit­ing from the ex­tra £1bn a year set aside by the govern­ment to fund free child­care. While the ma­jor­ity (58%) of fam­i­lies who earn £45,000 or more have taken up the of­fer, just a quar­ter (26%) of those earn­ing un­der £20,000 have done so.

The govern­ment orig­i­nally promised the of­fer would save work­ing par­ents up to £5,000 a year per child.

Com­ment­ing on the fig­ures, the Labour MP and shadow early years min­is­ter Tracy Bra­bin said: “The Tories’ flag­ship of­fer sim­ply isn’t liv- ing up the prom­ises they made in the elec­tion. Fees are ris­ing, free places come with hid­den costs, and too many fam­i­lies aren’t el­i­gi­ble for the sup­port they need – while nurs­eries and other providers are be­ing pushed to the brink of bank­ruptcy.”

Shazia Begum, 41, owner of the Brighter Fu­tures nurs­ery and preschool in Malvern, Worces­ter­shire, is one of those providers. She stopped pay­ing her­self a salary when the 30 hours of­fer was in­tro­duced. “It was ei­ther that or go bust,” she said. “If I had re­fused to of­fer par­ents 30 free hours, they would have taken their chil­dren to an­other provider – but the cost of pro­vid­ing those hours is higher than the govern­ment pays me.”

Min­is­ter for chil­dren and fam­i­lies Nad­him Za­hawi said: “We are in­vest­ing record amounts – about £6bn a year on child­care sup­port by 2020. This in­cludes about £3.5bn we plan to spend this year alone on all our free early ed­u­ca­tion of­fers, to make sure as many chil­dren as pos­si­ble have ac­cess to high-quality care.”

Tracy Bra­bin, shadow early years min­is­ter, said fam­i­lies weren’t get­ting enough sup­port.

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