Top-up fee ban 'will split nursery sector', providers warn
Private and voluntary nursery providers have warned that a two-tier system will be created, with children from disadvantaged families losing out on nursery places, following the announcement by children's minister Sarah Teather in last week's Nursery World that the Government will not change the rules on the free entitlement and remove the ban on top-up fees.
Anne-Marie True, chair of Save Our Nurseries, said, 'We are disappointed at the minister's decision to outlaw top-ups. To enforce what is effectively a price control will ultimately destroy the nursery sector. Her open promotion of side charges for extras is essentially dishonest. It is only a matter of time before a provider is taken to court as disproportionate amounts of money are being charged outside the free entitlement to remain sustainable.
'It is the child who will ultimately suffer, as inevitably high standards and quality will be jeopardised. Some will cut standards in a battle to stay within unrealistic price controls. Many unsung heroes will lose their jobs as more nurseries close down as a result of this flawed and unsustainable policy. Others will opt out, creating a two-tier system in nursery education.'
Dawn Nasser, owner of Rose House Montessori, Lewisham, London, warned, 'Providers will go bankrupt. A lot of children are going to be affected by this decision. By doing this, the minister is creating a two-tier system. We want a proper dialogue with the Government to explain the issues we have.'
Kate Peach, managing director of nursery group Early Years Childcare and founder of the Free Childcare Campaign, said, 'I'm frustrated that the Government has made the decision on top-up fees before we've even had the review.
'Providers across the country have long been highlighting the challenges the free entitlement poses. We had hoped the review would give the Government the opportunity to demonstrate their support for the sector.
Ms Peach added, 'The minister's claim that providers may have to withdraw because "delivering the free entitlement may not fit within their business model" suggests that we are unable to run our businesses successfully. The truth is, the lack of Government funding is going to be the reason providers withdraw. All providers support free entitlement, but we cannot continue to subsidise the Government's offer as our businesses, our livelihoods, are being impacted.
'I believe the minister's logic is flawed: if nurseries opt out or go out of business, disadvantaged children will lose access to high-quality settings and only the very wealthy will have access to high-quality childcare. A reduction in the number of providers would also mean women will not be able to return to work because there will not be enough places to go round.
'Local authorities seem to recognise that the system doesn't work as a large number of them are essentially allowing nurseries to charge top-up fees. I just don't understand why the Government won't acknowledge that it's flawed.'
But Nicole Kennedy, who runs Sunrise Pre-school in Brent and is the PVI representative for the Brent Schools Forum and a member of the EYSFF sub-group, said she was glad that Ms Teather had clarified the Government's position on top-up fees.
Ms Kennedy said, 'I'm pleased because it will sort out a situation that's been in disarray for years and is really messy. I'm relieved, because if nurseries pull out, this Government will see we can't provide quality childcare at these rates.'
She added, 'PVI nurseries have threatened to pull out, but by the minister sticking to her guns it will force us to look at our business model and really think about whether we can provide free places.
'There would be casualties for nurseries and nursery places but rather than local authorities turning a blind eye to nurseries bending the rules, it will be out in the open now that it's not achievable to offer quality childcare for free with the funding settings receive.
She added, 'If I walk into Sainsbury's and take a joint of meat that costs £8 and I chuck £3.52 at them and leave, someone would surely shout, "stop thief!" What's the difference between that and the Government stealing nursery places from us?'
VIEWS FROM NURSERIES AROUND THE COUNTRY
The last Conservative government introduced funding for early years back in 1996, its value then £2.54. Fifteen years later that figure in York has only increased by 78p. Both the last government and this current Government has squeezed the last drop of financial sustainability out of early yearS sector and without proper funding of the free entitlement or the ability to charge a fair rate we may well see its demise in the near future.
I would like to say that the LEA has taken on board our concerns and is more sympathetic than the Government with regard to funding issues. While Essex is not increasing the funding rates this year, they understand the problems settings face and have done their best to help settings find a way around the issue of sustainability through the Essex Code of Practice, as well as the national Code.
However, Sarah Teather is obviously unsympathetic towards providers and refuses to accept that if the funding rates were increased then settings would be in a better position to offer more places to disadvantaged families, while opting out will only exclude these children further and create a two-tier system. She needs to be realistic and maybe look at some settings’ accounts and ask herself how they are supposed to cover basic costs relating to rent, salaries, food, equipment and insurance, let alone anything else, based on the rates set for this forthcoming year. Our funding rate has remained the same as last year, but nothing else has – it’s all gone up!
From what we all are experiencing local authorities are trying to interpret the Code to enable PVIs to recoup any losses caused by the free entitlement. The ‘admissions policies’ being allowed in some areas are proof of this. They do need us to meet their providers of places quotas.
The Government has again showed itself to be uninterested in the needs of the child and only interested in being seen to be socially aware. By refusing to allow PVI settings to "top-up" the shortfall between actual costs and what the Government provides in funding, they are effectively sounding the death knell to nursery care as we know it. The country will end up with a two tier system where the "haves" attend quality settings and the "have-nots" get left with nothing.
I think that all we can say is that if this is the case it is the very children that the 'free' entitlement is meant to help are the ones that will lose out. Many pre-school businesses that provide high quality care and education will no longer be able to remain in the scheme and keep their businesses sustainable, hence these places will be denied to the most disadvantaged children.
Whereas in the past we have all enabled some of these parents to access places, this will no longer be possible. The result will be a two-tier system, similar to the rest of the education system in this country and the gap between those with the means to pay and those without will widen.
Sarah Teather has completely misunderstood the whole situation. She still talks as if by charging ‘top ups’ we will all make money. It is very sad that consistently and continuously for over five years we have been trying to explain to Government that the policy is unworkable, because the amount of the free entitlement does not cover our costs. It is not a ‘top up’ we want but the flexibility within the Code of Practice to allow us private providers to recoup the short fall between the Government’s subsided funds and the real costs it takes us to deliver a high quality provision to our customers, the children.
What right does the Government have on imposing a ‘price control’ on our services? This policy is going to cause a major divide within the sector that will only be able to be described as a ‘two tier system’.
The Government is refusing to acknowledge nursery owners across the country, who have warned time and time again that the continued underfunding of the free entitlement and the restriction in charging ‘top-up’ fees will lead to a shortfall in high quality nursery education across the country. To maintain quality practice, nurseries will have to opt out of funding and go completely private, thus creating the very two- tier system which the Government claims to be so keen to avoid.