report: Sector contests claims of huge childcare fee rise

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The early years sector has disputed claims made by that childcare costs have increased by 19 per cent in the past year.


Early years organisations says claims that childcare fees have increased by 19 per cent are incorrect

According to’s second annual childcare report, childcare in the UK rose on average by 19 per cent between December 2012 - December 2013, preventing 25 per cent of unemployed parents working.

However, while says its figures on costs are based on the responses of 231,000 ‘childcare professionals’, the data only appears to include fees charged by mostly unregulated providers, such as babysitters, nannies, mothers’ helps and housekeepers.

Early years organisations, nurseries and childminders have spoken out against the figures, which theysay do not acurately reflect the fees of regulated childcare for nurseries and childminders.

Purnima Tanuku, chief executive of the National Day Nurseries Association, (NDNA) said, ‘’s survey focuses more on informal childcare such as babysitters, nannies and housekeepers.

‘The nursery sector reflects a different trend and the evidence collected in NDNA’s Business Performance survey shows increases are not remotely at this level.

‘More than half of members surveyed, 58 per cent, said they had frozen their fees. Many made the decision as they know how hard it is for working parents who are themselves facing pay freezes.

‘For the childcare providers keeping prices down, the gap between the amount they are paid for funded places and the actual reality of the delivery cost continues to be a problem.’

She added, ‘The Government needs to overhaul the funding system and ensure places are properly financed to stop the cycle of childcare costs being a barrier to finding work.’

Neil Leitch, chief executive of the Pre-School Learning Alliance, has argued that the figures do not ‘align with reality’ for the vast majority of early years providers.

He said, ‘This survey only cites changes in the rates of nannies, babysitters, mother’s helpers and housekeepers. While such childcare professionals may make up the majority of’s own client base, they only comprise a small proportion of early years providers across the country. As such, the results of such a survey are in no way representative of what is happening in the childcare market as a whole.

‘Of the many multiple and single-site providers I have spoken to over the past year, I have never come across a single one that has imposed anything close to the rate increases being quoted in this report. Indeed these figures completely contradict the findings of the recent Children and Families Trust survey published earlier this year.

‘Of course, although we do not recognise the figures cited in the report, we do acknowledge that many parents and families are indeed struggling to cope with rising childcare costs. At the same time, lack of sufficient Government funding means that many providers are still struggling to break even and wages in the sector remain extremely low.

‘There is no quick or easy solution this to this: the Government simply must start investing adequately into childcare in this country. Unless the Government accepts the need to increase early years funding, the challenges currently facing both parents and providers are likely to continue in the long term.’

Ellen Broome, director of policy, research and communications at Family and Childcare Trust, said, ‘The vast majority of children will be in regulated childcare such as nurseries and childminders. The 19 per cent increase applied only to non-regulated provision.

‘The Family and Childcare Trust will be releasing figures on the regulated sector in March in our annual childcare costs survey.

‘The important point is that childcare costs are rising well-above inflation, with the price of childcare in the regulated sector rising by 77 per cent over the last ten years when wages have remained the same making it increasingly unaffordable for parents.’

A number of childminders commented on Facebook to say they have not increased their fees in the past year.

One childminder, Suzanne Chipperfield in Worthing, West Sussex, said, ‘My fees haven’t risen for two years. In 1997 I was charging £2.50 per hour and now I charge £3.50-not much of an increase in 17 years.’

Another childminder, Lisa Fricker in Southampton, said, ‘I charged £3.50 an hour per child in 2009 and now charge £3.70. I think it’s ridiculous blaming childcare costs on us.

‘People are happy to pay more for a cleaner or dog walker than they are for the care of their children.’

Julie Dodd, managing director of MK Focus, which supports childminders in Milton Keynes, told Nursery World that the average hourly rated charged by childminders in the area is £4 per hour.

She explained, ‘With the high costs of energy, food and petrol, many childminders earn below the minimum wage. We have to pay for additional training, work long hours to offer a flexible service, often in excess of 50 hours per week, and then there are the unpaid hours after the children leave to do paperwork and admin.’

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years (PACEY), said, 'PACEY recognises the increasing burden that parents are facing with rising childcare costs, as highlighted by this report. But it’s often forgotten that childcare professionals are amongst the most poorly paid professionals. It is also important to remember that childcare costs vary greatly according to regions across England and Wales. Childcare is a very localised market.

‘Government is providing more support to families through its tax free childcare plan and extensions to the free entitlement but it is clear that more is needed both in terms of childcare costs support and improved opportunities for parents to work flexibly, to balance family and working life. High quality childcare costs and more investment is needed to support providers to deliver the flexible, quality care that children and families deserve.’

Marg Randles, operations director at Busy Bees nursery group said,  'Busy Bees is the largest childcare provider in the UK with 213 nurseries and our average fee increase was three-per-cent.

'All childcare providers will set their nursery fees on an individual basis bearing in mind the rising costs of quality staff, fresh food and nappies etc.

'Our average figure of three-per-cent included a number of nurseries where fees were frozen, a number of sites on two-per-cent and a small number of  sites at four-per-cent and we expect 2014 to be about the same.'

Commenting on the report, a Department for Education spokesperson said, ‘Recent figures show childcare costs are stabilising after more than a decade of constantly rising prices.

 ‘We are taking decisive action to help families with the cost of childcare. We have increased free early education for all three- and four-year-olds from 12.5 to 15 hours a week and extended support to two-year-olds from low-income families. We are also introducing tax-free childcare which will see all eligible families receive up to £1,200 towards each child's childcare costs. At the same time, we are meeting up to 70 per cent of childcare costs for low- and middle-income families through tax credits.’

Tom Harrow, chief executive of said, ' currently has 231,000 childcare professionals registered on the website, ranging from babysitters, Ofsted registered nannies, through to au pairs and mother’s help. The 19% increase in cost, as published in our Annual Childcare Report has come from the average amount that each childcare professional charges per hour, compared to 12 months ago.  Every three months we track childcare costs, because we care about what parents are dealing with. Our results do not reflect regulated childcare such as nurseries and crèches – all other childcare is available on our website.
' is a destination for parents to find many types of childcare solutions, giving families a variety of options and costs to meet everyone’s budget . We created the Annual Childcare Report to bring to the forefront the issues that parents are having when it comes to childcare.  In this tough economic time there is a high demand for good quality childcare professionals, and wherever there is demand, you can expect inflation.'




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