30 hours: How nurseries are making ends meet

We looked at their business and charging models and what adaptations they may have made. For most, the rate of funding they receive does not cover the cost of a 30-hours place.

While providers’ approaches vary, they are all asking for a voluntary contribution from parents and/or placing restrictions on when the 30 hours can be taken.

This follows comments from the children and families minister Robert Goodwill last week that ‘most providers’ are able to offer the 30 hours at current funding levels, and those that can’t are ‘outliers’. He went on to question whether providers are struggling because they are working to less profitable ratios or had higher property costs.

Mr Goodwill made the comments in response to a question on early years funding from Labour MP Luciana Berger.

It comes after the children and families minister revealed last month that he had visited just three early years settings between June and 14 October - one is a maintained setting. Of these, two were in Tower Hamlets and one in North Yorkshire.

The Department for Education were unable to provide Nursery World with an update on the number of visits from 14 October onwards.

Raindrops Day Nursery in Harlow, Essex

The 64-place private nursery is only offering the 30 hours during term time.

Parents are asked prior to taking up a 30-hours place whether they will pay a voluntary contribution of £10 a day or £6 per session, which goes towards extras. If they agree, the contribution – which the nursery says is not equivalent to what it effectively loses per place – is shown on their monthly invoice.

Hot meals are charged for separately.

Manager Chris Chaffe and deputy manager Jayne Ellis said, ‘We are delivering the 30 hours on a term-by-term basis. This is very much dependent on the take-up of voluntary payments.

‘If we find at any time that the parents feel they do not wish to pay a voluntary contribution, then we will not be viable to continue to offer the extended entitlement.’

They added, ‘Working out how to deliver the 30 hours and remain sustainable has been a very stressful experience. We know Mr Goodwill is keen to hear from nurseries about the challenges they are facing – we welcome him to visit our setting and see for himself.’

Tops Day Nurseries

The nursery group of 19 settings throughout the South of England uses the extra entitlement funding to subsidise the overall cost of the hours parents take up.

Where funded hours are taken inside the nurseries’ ‘core hours’ of 9.30am to 3pm, a separate ‘general extras’ charge is added, unless the child meets any of the following criteria:

• They are eligible for the Early Years Pupil Premium (EYPP).
• They have a younger sibling at the nursery who does not access two-, three- or four-year-old funding.
• They access the 15 universal hours but attend 30.25 hours or more per week.
• They access the 30 funded hours and attend 40 hours or more a week.
• Meals are optional and charged for separately. Parents can send their child in with a packed lunch if they wish.

Little Darling Childcare in Harrow, London

The home-based nursery, which employs 11 staff, can look after 26 children at any one time. Nine of its children are eligible for the 30 hours.

Within the nursery’s contract, drawn up with the help of a contract lawyer, there are separate rules for funded days and non-funded days.

• Funded days Parents have to take three full days as funded. The day is split into two sessions of five hours each: 7.30am to 12.30pm and 1.30pm to 6.30pm. Lunch is charged at £15 – the shortfall between the nursery’s day rate and the funding it receives of £4.06 per hour. If parents opt not to pay for lunch, they must collect their child after the morning session. For every five minutes parents are early to drop off their child or late to pick them up, they are charged £7.50. The nursery says this ensures there is no ‘wiggle room’ for parents.
• Non-funded days Lunch is included and there are no early or late fees.

George Perkins Day Nursery, Birmingham

The 47-place nursery offers the 30 hours on a stretched basis only over 51 weeks, which works out at 22.3 hours per week.

Parents in receipt of the extended entitlement must take a minimum of two full days, using 20 funded hours. To take the full 22.3 hours they have to pay for a third full day, with the additional 7.7 hours charged at the nursery’s normal rate.

Nursery owner Sarah Presswood said it has always charged for meals for children accessing the universal 15 hours, but has introduced an ‘additional services’ charge for all parents accessing Government-funded places in order to cover the cost of meals, snacks, trips out, access to music sessions and the use of the online learning journey.

While the charge for ‘additional services’ is voluntary, the nursery tells parents that without it the setting would have to be strict about which children whose families did not pay could access the places, creating a two-tier system, said Ms Presswood.

She added, ‘So far, no parents have refused to pay for additional services, but several have questioned why there is a charge for something they had been told would be free.’

The nursery has also increased its fees for all children to mitigate the loss from the funded hours.

Acorn Childcare, part of Acorn Early Years Foundation

The social enterprise runs 10 nurseries across Buckinghamshire and Northamptonshire.

Chief executive Zoe Raven said that for parents taking up the 30 hours, it calculates the fees for additional hours at the difference between the funding received and the normal full session amount. She said that most parents have the stretched offer.

In a few cases, where parents request hours/sessions that match the number of funded hours, they are asked for a voluntary contribution. Ms Raven says that in most cases parents have willingly paid.

The nurseries also prioritise full-time sessions over part-time sessions – however, this is part of Acorn Childcare’s normal admissions policy.

Sector organisations’ comments

Purnima Tanuku, chief executive of the National Day Nurseries Association (NDNA), said, ‘We know that nurseries are working within Department for Education guidelines in delivering this 30-hours policy. However, the vast majority can only offer 30 funded hours by charging parents and limiting places due to being paid insufficient hourly rates. This is not “free” childcare but subsidised by nurseries and parents.’

Neil Leitch, chief executive of the Pre-school Learning Alliance, added, ‘Inequality of opportunity seems almost hard-wired into the 30 hours. Not only does the scheme’s eligibility criteria exclude low-earning families – whose children would often benefit the most from quality early years provision – but as a result of the scheme’s chronic underfunding, many working families at the lower end of the eligibility income scale are at risk of being pushed to the back of the queue when it comes to accessing places.

‘The Government is well aware that at current funding levels, most providers are unable to offer truly “free” places and continues to suggest that parents can make up the shortfall with “voluntary” charges for additional goods and services. But the consequence of this is a two-tier early years system where those parents who can afford to pay extras will find childcare places much easier to come by than those who can’t – and that is simply unacceptable.’

• See ‘Open all hours’ in Nursery Chains, Autumn 2017, free with this issue.