Nursery Chains: Policy - Doubling up

Earlier this year, the Government asked childcare providers and local authorities to volunteer to be among the first to double the hours of funded childcare for working parents. The free entitlement to early education for three- and four-year-olds with working parents is set to increase from 15 to 30 hours in September 2017, but the Government wants to trial the new system from September next year. Education Secretary Nicky Morgan has said that hundreds of providers had expressed interest in the trial before the sign-up deadline of 28 September. These range from national chains like Busy Bees to smaller, more local groups.

Bertram Nursery Group, which has 16 settings in England, is one of those providers. The nursery chain has put itself forward to participate in the pilot, but its interest in taking part is not unalloyed with concerns. ‘Through the process, Bertram hopes to learn and share more about how the scheme can be implemented, as well as participating in feedback to ensure this implementation does not happen at the expense of nursery providers,’ says Cary Rankin, managing director, England, at Bertram Nursery Group. ‘Many are already struggling with the costs associated with running 15 hours funded places.’

Mr Rankin says there may be a perception that nursery chains are in a stronger position to take part in the 30 hours trial than single setting providers, as they may be able to balance costs or offset any losses as a result of Government or local authority underfunding of the free entitlement. ‘But the question really is, why should any PVI nursery business, regardless of its size, be put in the position where it has to make those types of difficult decisions?’ he asks. ‘The risk here is that businesses throughout the sector pull out of offering three- and four-year-old funding full stop.’

While providers that have registered an interest have not yet heard back from the Government as to whether they have been selected to take part in the trial, many are already considering what they will need to plan for when offering the 30 hours. It is very early days though, and planning will depend on the funding rate, whether settings will be allowed to charge for extras such as meals, and whether the funding will be term-time only or whether parents will be able to stretch it out over the course of a year. These are all issues which are yet to be ironed out, making it difficult for settings to decide whether or not to get involved in the early stages.

Mr Rankin says there are a number of issues that will have to be taken into consideration when delivering the 30 hours, including staffing resources and the associated costs, taking the adoption of the national living wage into account. ‘Other issues include capacity planning, training, and investment in resources and facilities to fully accommodate where booked sessions will be increased,’ he says. ‘You have to think about how you fit that offer into the existing nursery day, balancing the needs of the paying parents and children with those who are getting the free entitlement. Extending nursery services comes at a cost and this must be factored into the funding formula.’

Kid Ease, a chain of five settings in Norfolk and Kent, has also registered to take part in the trial. Ian Atkey, managing director, says he believes doubling the free entitlement to 30 hours a week could be a more effective way of managing funding. ‘Recently, funding for the 15 hours has been allowed to be stretched over the year which, while more beneficial for working parents, is more problematic for providers to cater for, as reduced weekly hours tend to fall outside "standard sessions",’ he says. For Kid Ease, 15 hours can fit into three nursery sessions, but when it is stretched over a year it becomes 12 and a half hours a week, which is harder to incorporate into general nursery hours.

‘For us, the ideal way to deliver the 30 hours would be three full days or six half days, but that would be term-time only – if it is stretched across the year it would probably be 24 hours a week, which is more difficult to administer,’ explains Mr Atkey. However, he adds, stretching the 30 hours over a year would certainly improve opportunities for parents and the general feasibility of increasing maternal employment. ‘The real added value lies with improving opportunities for pre-school children, with an increased access to learning through play giving a positive impact on future educational success,’ he says.

The 30 hours will only be available to children with all parents in a household working, which may be confusing for families. ‘It depends on how the Government or local authority wants to gather that information. I am not sure how we would prove that they are both working [in a two-parent household] and, anyway, would parents want to share employment information with their nursery?’ asks Mr Atkey.

‘There is then the question of keeping up to date; some people’s employment circumstances can change fairly regularly. I would also question whether it is unjust for families where only one, or neither, parent works not to have access to the 30 hours. For example, if one parent worked while the other studied or was in training, should they be treated differently?’

Concerns

National chains such as Busy Bees have also registered their interest. Marg Randles, managing director and one of the founders of Busy Bees, says she welcomes the opportunity to take part, preferably across a number of local authorities. ‘We have nurseries in over 100 local authorities so we do hope that it will be possible for us to take part on a national level,’ she says.

‘We’re committed to making this work – it will ultimately benefit many children who deserve the best possible outcomes. There are operational concerns that need addressing for this to be viable, but being part of this pilot scheme will enable us all to come together to find solutions and a way forward.’

Olivia Foley is director and founder of Hungry Caterpillar Day Nurseries, a group of eight settings across West London and the Home Counties. She had not intended to get involved in the trial, due to concerns about the shortfall in funding, exacerbated by additional financial demands caused by the minimum wage increase and the introduction of the living wage. However, after reading the arguments put forward by business consultant Ray Easton, who flagged up the benefits of taking part in the trial in a recent blog post, she changed her mind.

‘The argument was that this is going to happen anyway, and it is better on the whole to be on the inside looking out than on the outside glaring in,’ she says. Mr Easton argues that grants and extra support may be available to assist the trial groups, as well as access to early findings or research. He adds, ‘Developing your organisation to deliver early will give you an advantage over competitors, meaning more demand for you and the chance to build sector credibility and marketing collateral.’

Ms Foley remains concerned about the capacity of settings to offer the additional places which will be required, something that was recently flagged up by teachers’ union NAHT. ‘If nurseries offer 30 hours, then fewer children will be able to access funded sessions and there will be a shortfall of places nationally,’ she says. NAHT found that more than half of schools with nurseries attached (54 per cent) said they did not have the capacity to increase the number of funded hours they offered, although just under half of schools surveyed said that they could increase capacity if capital funding were made available to them.

Spreading the hours

The Seymour House nursery group has decided against taking part. Operations director Jonathan Player has concerns about the effectiveness of the policy in general. ‘If the policy aim is to support working families with childcare costs, I feel it would be much more effective if it were spread across the whole of the early years,’ he says. ‘The current proposal leaves a two-year gap between the end of maternity leave and when the child turns three. This means that by the time many families receive support with childcare costs, one parent has been out of the workplace for nearly three years,’ he adds.

‘It is my experience that many parents would much prefer this funding to be spread from when they return to work after maternity until when the child starts school. This would alleviate some of the higher costs of childcare for very young children and allow parents to stay in the careers they have worked so hard to build.’

It seems that even those chains that have signed up for the trial have concerns about the impact the policy could have in terms of losses, capacity and the quality of early education. It is an issue all sector professionals will be hammering out over the next two years, through conversations with each other, the Government and within their own settings.

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