Nursery World - NEG funding fails to plug shortfall

Funding for the free early years entitlement for nurseries rose by only 11 pence an hour last year, with local authorities failing to plug the shortfall, claim market analysts Laing & Buisson in their report Children's Nurseries 2009.

The average level of nursery education grant funding went up to 3.41 an hour from 3.30.

Although local authorities were required by the Government last year tocarry out a cost analysis of childcare provision to determine gaps infunding, the report said that 61.5 per cent of nurseries could not meettheir costs - the same number as last year.

Author of the report and economist at Laing & Buisson, Philip Blackburn,predicted this would lead to 'heavy casualties' in the nurserysector.

'Although an increase of 11 pence an hour is in line with inflation, noreal increases in the entitlement means there has been no change to thecurrent loss-making position reported by most nurseries,' he said.

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