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MPs raise impact of increase to national insurance on nurseries, pre-schools and childminders

The bill regarding the Government’s planned changes to employer National Insurance contributions (NICs) was debated in the House of Commons yesterday, with several MPs raising the issue of the impact of the plans on nurseries and early years providers in their constituencies.
Ministers have claimed that new early years funding rates will cover national minimum and living wages increases but has yet to publish calculations to demonstrate this PHOTO Adobe Stock
PHOTO Adobe Stock

In the Budget, Chancellor Rachel Reeves revealed employer’s NICs will rise by 1.2 percentage points to 15 per cent from April next year.

Many early years providers have warned that any increases which are not covered by a rise in funding rates for the expanded childcare offer will lead to them having no choice but to raise fees for parents in order to keep their businesses from closure.

Moreover, findings from a Nursery World survey published this week suggest Budget measures could deepen the sector’s longstanding recruitment and retention crisis, affecting settings’ ability to take part in the expanded hours offer and putting the policy at risk.

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