As the eight chosen areas begin to pilot the 30-hour free entitlement from this month, some settings are introducing new policies such as charges and limiting flexibility.
York nursery Polly Anna's, along with the rest of the city's participating settings, is getting a boosted £4 per hour for each three- and four-year-old child.
However, the funding does not cover the services the nursery provides, and the setting is deploying what owner Ken McArthur claims is a ‘model strategy’ for tackling the financial shortfall.
Working families claiming the entitlement will be given the choice of signing up for one of two packages, with the first being a 52-week service offering 22 funded hours a week.
This package comes with an ‘additional services charge’ of £16.50 each week, which includes healthy meals and guaranteed sessions until children leave for school.
The second package is a 38-week completely free service offering 30 funded hours per week, with no meals provided and no guarantee of an ongoing place.
The latter sticks to the letter to the Government's view of what a basic service is, according to Mr McArthur.
‘I'm trialing this way [the first package] of being able to provide the 30 hours, because when I consulted with parents they said they wanted the service I provide over 52 weeks a year,’ he said.
‘This is more expensive, because guaranteed sessions are more expensive.
‘In making the offer, I have tried to provide a service which gives my parents the service they want, but in a way which complies with the rules and regulations on offering funded hours.
‘It's parental choice whether to go for one or another.
‘For a working family, the Government offer is a pretty poor offer.
‘None of my parents have signed up for that offer.’
The nursery boss, who also chairs the National Day Nurseries Association's regional network, said most of his parents have been using Polly Anna's since their children were babies, and want to keep their children's places so that they can make concrete arrangements for returning to work.
Should they wish to take up the second, pared-back offer, Mr McArthur explained that parents must cancel their existing contracts guaranteeing their children a place and apply for a ‘completely free place’.
These will be granted subject to availability, and will need renewing on a termly basis.
The alternative does not fit in with their working lives, because they work more than 38 weeks a year, he added.
Mr McArthur continued, ‘Daycare centres have been trying to provide all the services that they think parents need and I totally agree that to provide all these services, there needs to be a fee. I accept that the Government shouldn't pay for the things that parents [say they] need – the meals, the guaranteed bookable sessions.’
So far, all his category one places are full, so should any new parents wishing to take up the entirely free places wish to apply, they will be turned away.
Mr McArthur argued this was the best way to ensure the £15,000 shortfall between the service the Government is willing to fund, and the service his parents demand (costing Polly Anna's £4.75 per child per hour), is covered.
For those parents only accessing the 15 hours, there will continue to be a voluntary charge for meals, with those opting to send a packed lunch being free to do so.
While York's funding is available to all parents who would be eligible under a full rollout, Swindon has been allocated just 416 places for the ‘early implementation’ phase.
It has allocated these by targeting employees of the town's major businesses.
These include the Great Western Hospital and related contractors, the BMW plant and Brunel Shopping Centre, for whom Swindon's settings will be offering a unique selling point of extended opening hours.
Kate Adams, who owns The Play Den nursery in the town, said due to the restricted eligibility, only seven of her 48 places will be offering the 30 hours – funded at a pilot hourly rate of £4.41. It will be up to parents whether they want to take these over 38 weeks, or stretch them over the 48 weeks that she opens, including Saturday mornings.
The biggest change she is making to accommodate the offer is being passed on to those who access the 15-hour entitlement.
Whereas previously she allowed these parents to choose almost endless variations on the length of their sessions, now she is restricting them to fixed duration mornings and afternoons, and adding a further 3pm-6pm session.
At the moment, seven families are manageable, but Ms Adams is not sure how she would cope with more.
‘The funding rate would have to go up, or I'd have to limit how many 30-hour children I took,’ she said.
‘Or I would have to charge the paying parents more, the parents of the nought to threes that aren't eligible for the two-year-olds funding.’
Ms Adams had proposed to expand the two-year-olds offer, as she is based in an area with high deprivation, but this would be unlikely to happen.
‘This is a trial run,’ she said. ‘Though it has come at the worst time with the pensions kicking in and the living wage.
‘That's why I wanted to take part, I wanted to know actually how it works and how I can plan for the following year.’
There is no change in the way she provides meals, charging funded families £2.25 per meal. Those paying for additional hours have meals included.
Cheryl Hadland, managing director of Hadland Care Group, which owns Tops Day Nurseries, said two of her settings, at Queen Alexandra Hospital and Lakeside, are located in Portsmouth, another of the pilot areas.
Unlike settings in York and Swindon, Portsmouth's hourly rate of £4.88 seems not to be prompting any unease.
‘That rate is actually a reasonable rate so we're quite happy actually,’ Ms Hadland told Nursery World.
‘The downside is that the hospital nursery is full so we need more space. We're negotiating whether we can build extra space.’
Tops already charges for meals, and is flexible across long opening hours of 6.30am to 7.30pm.
‘The 30 hours can sit anywhere on that,’ Ms Hadland added. ‘If you're not getting enough funding, I don't think you’ve got any choice but to charge for extras such as meals, snacks, yoga and digital tables, that are not in the EYFS, and give the parents the option to take spaces at those times or not.’
Linda Cregan, CEO of the Children's Food Trust, suggested an unintended consequence of the funding changes could be poorer nutrition.
Ms Cregan urged the Government to include meals in the rates to avoid children bringing in junk food.
‘With more children eating more meals and snacks in childcare as free childcare is extended, we have an unprecedented opportunity to help young children build healthier habits,’ she said.
‘But there's still much more to be done to support childcare providers – not least in enabling free childcare to reach its full potential as a way to get children eating well.
‘That means making sure funding to nurseries, pre-schools, children's centres and childminders delivering free childcare reflects the cost of good food, and helping nurseries to introduce packed lunch policies.
‘Our pre-school food survey found that four out of ten children bring crisps to nursery and a quarter bring confectionery, while our recent national analysis of millions of packed lunches in the last year found that chocolate biscuits, crisps and sugary drinks are still daily staples.
‘Our survey with Nursery World found that of those who expected 30 hours to impact upon their food provision, around one-third expected to ask families to send in food from home instead.’
Another option may be for settings to put in place a healthy packed lunch policy, she added.
Hertfordshire County Council is also running a limited pilot, with families only qualifying if they live within two miles of a ‘hub setting’.
According to Claire Traxon, who owns Early Adventures in Abbots Langley, Hertfordshire, the county council had initially planned to offer the 30 hours to families previously eligible for the two-year-olds’ funding. But when too few families came forward, the remit was widened to residence within this set radius, said Ms Traxon.
Ten new ’30 hours’ children are due to start with her this autumn, funded with a two-tier system of £4.59-an-hour for the first 15 hours, and £4.88 for the extra hours.
A £2 meal charge will be added for those whose sessions straddle lunchtime – as she has done previously for ‘15 hours’ children.
‘These rates are lower than what we would charge at the nursery but looking at it, it’s feasible,’ she added.
‘They are all happy for us to provide lunch, if they want the hours straddling lunchtime.’
The proof of the pudding will be in the pilot, so to speak, but Ms Traxon is not planning to tweak the flexible offer she usually makes available at her setting.
‘If they want to do a school day – 9am to 3pm – they can do that,’ she said. ‘Some will do the hours including the summer, with five days just mornings, or three full days.’
Early Adventures opens 7.30am to 6.30pm, which the owner believes will give her ample opportunity to cross-subsidise the increased offer with her private charge for extra hours (£5.75 for extra hours or part days, or a full-day rate of £48), which includes meals.
Meanwhile, she has submitted a capital bid to extend and double her capacity to 44 places, which will be well-timed for the following year and is a busy time for home building locally.
‘I think the offer is a great initiative for parents, to help them back to work,’ said Ms Traxon.
‘Providing the pilot goes well, I think it will be beneficial for settings and parents. You haven’t got to sign up for it, so it’s settings’ choice.’
She added that one option is to link up with other settings to share the offer, with two settings offering the same child 30 hours between them. ‘There are ways around it if you work together,’ she said.
CHARGES FOR EXTRAS IN FUNDING FORMULA CONSULTATION
Charging for meals features in the Government's recently published funding formula consultation, which makes it clear that the entitlement does not cover food.
However, settings must not make any extra charges compulsory, or a condition of taking up a nursery place.
The consultation document states, ‘It is not intended to fund the cost of consumables (such as drinks, meals and nappies) or additional services (such as baby yoga, music lessons and trips).
‘Providers are free to charge parents for such discretionary items, provided they are not compulsory. So, for example, paying for additional services must not be a condition of taking up a free publicly funded place.’
Sarah Steel, who runs Old Station Nursery Group in Oxfordshire, Berkshire and Gloucestershire, said the freedom to charge was ‘absolutely essential’.
‘These extra hours are for people who are working,’ she said. ‘On the whole, parents are more than happy to pay. These aren't the most disadvantaged two-year-olds.’
Ms Steel also highlighted how the application and interpretation of the code of conduct on charging varies between local authority areas.
‘Some local authorities let you do what you like and some are really on your back.
‘If you tell the parent you're going to put a meal charge on, they can go to the local authority.
‘The code of practice says parents can't be obliged to pay for additional services, if they want a packed lunch. In theory, the council can say [to the nursery] this session isn't eligible for funding.’
Cheryl Hadland, managing director of Tops Day Nurseries, described the issue as a ‘postcode lottery’.
‘I think you have to have that discussion with parents,’ she added.