Making all parents pay their nursery fees on time may be awkward for naturally caring managers, but it has to be done, says Mary Evans
Six million families will be eligible for financial support with the launch this month of the new Working Tax Credit and Child Tax Credit schemes, and many of them will also be able to claim assistance with childcare costs.
The changes are part of the Government's long-term drive to encourage families off benefit dependency and into the labour force. But for some people, trying to juggle the competing demands made on their low incomes proves an unequal struggle and they fall behind with their childcare fees.
Indeed, Rosemary Murphy, chief executive of the National Day Nurseries Association, says, ' A lot of people these days are not used to handling money. If the children need new shoes or the exhaust falls off the car and the childcare fees are due, which gets paid? Nurseries are ending up as debt counsellors.'
Rosalind Taylor, joint proprietor of the Devon-based Puffins chain of nurseries, says that childcarers are by nature kind people. When a proprietor or manager has formed a caring relationship with a family, it can be tough to take a firm stance.
She advises managers and owners to calculate the real implications of bad debts on their business. 'We worked out that at one of our nurseries, which at the time had 40 places, we needed to have 32 places filled to cover our costs, and we did not include our wages,' she says. 'There is little room to manoeuvre if someone defaults on their fees.'
Michael Ruaux, managing director of Crofter's Park Nursery in Bolton, Lancashire, says, 'Our normal terms are to ask for a week's deposit and one month up front. Parents who are looking to return to work, or who are maybe starting work for the first time, are not going to be able to do that.'
The nursery asks parents to pay by standing order, with fees going out of the parents' account on the day the child starts nursery and arriving in the nursery's account three days later.
'Some of the parents who have the least money are the most meticulous about paying week in and week out. They know that if they missed a week, they could not cope. Some of the best payers are like that.'
However, Sue Ranson, managing director of the Cornwall-based Coombe Valley nursery chain, prefers not to use standing orders. She finds that taking a set amount each week or month from a parent's bank account does not match children's attendance patterns at nursery.
The managers at each nursery in the chain have responsibility for preparing invoices after checking the registers to see exactly when children have attended nursery, and any extras such as swimming sessions.
Regardless of the payment regime a setting adopts, at some stage managers are bound to encounter parents who do not or cannot pay on time. Action must be taken quickly.
Finding the right moment to talk to a parent can be tricky - you want to avoid having a potentially abrupt conversation with a parent when a child is present, and at the next session a relative may collect the child, and so delays occur. Mrs Ranson, therefore, prefers a system of letters.
'The first letter says, "Oh dear, you appear to have missed a payment". The second is on the lines of "I say, we still haven't received the payment". And the third says, "Pay by such and such a date or don't bring your child in any more".'
Mrs Taylor says, 'We are strict, otherwise people take you for a ride.' She makes it the responsibility of the administrator, rather than the manager, to contact parents about overdue fees, to arrange a payment date and, where necessary, help parents work out what they can pay.
'Maybe they can pay an extra #10 a week,' she says. 'We allow a bit of leeway for mothers returning to work after maternity leave, as it can take them a couple of months to get their finances straight.'
Mr Ruaux has not pursued debts through the courts when he has felt that even if the court made an order requiring parents to pay so much a month, the money was unlikely to be forthcoming.
However, Mrs Ranson insists it is always worth instituting legal proceedings. She won a case against a woman only to find that her partner owned everything in their house, leaving the bailiffs unable to raise any money. However, the County Court judgement against her meant the woman could not have a bank account.
'If people want to operate in society in the normal way they want these things, so they pay. If they do not pay, they risk getting a bad credit rating and all that involves. For most people the threat of litigation is enough.'
Mrs Taylor warns that settings must have their contracts phrased correctly so they can chase defaulters and recommends that both parents sign it. In one instance, only a mother signed and the father refused to take responsibility for paying the fees because he had not signed it. 'You can only chase a signatory,' she warns.
