2m fund to boost childcare start-ups

From 1 May, individuals who wish to set up a new nursery or childminding business can apply for grants of up to £500 to help cover legal and insurance costs, training, equipment and adaptations to premises.

They will also be encouraged to join up with a free business mentor and access specially tailored business start-up advice. The scheme is intended to help launch 6,000 new childcare businesses.

Grants will be available over the financial year 2013/14. They will be either £250 for individual childminders or £500 for larger childcare providers. Businesses with more than six children can use the money to help pay towards the deposit on a new premises.

Maria Miller, the minister for women and equalities, announced the £2 million fund in November 2012.

Ms Miller says, 'Women are absolutely vital to maximising the UK's economic recovery, so it's more important than ever that we ensure we are doing all we can to get more women into work.'

'We all hear how difficult it is to get childcare and how it is a real barrier for some women getting back into work and we have listened. More childcare options mean more women can take up jobs, help support their families and achieve their own career goals and aspirations. The childcare industry is already a major employer of women, and this scheme will mean more opportunities for female entrepreneurs to start-up and run their own businesses. This is a cash boost designed to stimulate the sector in tough times.'

The grant scheme comes on top of a package of measures that the Government is taking forward to boost childcare provision and get more women into work. That includes a new tax break for childcare costs for working families worth up to £1,200 per child per year, overhauling childcare qualifications and providing more choice of quality education and care for parents, extending the right to request flexible working to all employees and allowing parents to share up to a year's leave to care for their newborn child.

Although it is aimed to encourage more women into work, men will also be able to apply for the funding.

Liberata UK, a provider of business support services, has been appointed to manage the scheme on behalf of the Government.

Catherine Farrell, joint chief executive at the Professional Association for Childcare and Early Years, said, 'These grants, if administered effectively, will provide a welcome contribution to the significant costs of establishing a nursery or childminding setting and support expansion of existing provision. However, PACEY has become increasingly concerned that the mechanisms proposed to distribute the grants will be open to misuse and, potentially, mean this vital support does not deliver the childcare places where families, including those with disabled children, need them most.’

Neil Leitch, chief executive of the Pre-School Learning Alliance, said, 'The £2m allocated to create 6,000 new childminder and day nursery businesses may just about cover insurance costs alone, never mind covering the cost of purchasing equipment, toys, books, rent and rates, salaries and other core expenses.
 
'We would have preferred the Government to allocate the £2m towards paying existing settings an effective rate under the free early years entitlement as a small capital injection is no substitute for a long-term viable proposition, which is what the sector really needs.

'We would question the Minister’s emphasis on women as the Government ought to be encouraging more men to start businesses as childminders or day nurseries. Childcare is not women’s work alone and the Government needs to acknowledge this in its policies.'

• To find out how to apply for a grant visit: www.childcarebusinessgrants.dcms.gov.uk