Are HMRC nursery closures a sign of what's to come?

Last month, Bright Horizons confirmed the closure of the eight nurseries it runs for HM Revenue and Customs (HMRC), in partnership with management company Mapeley, which owns the buildings.

The settings, most of which are rated good or outstanding by Ofsted and provide a total of 300 places, will close in November.

The reason HMRC has given for the closure is that providing childcare facilities is no longer part of its 'core business', which is collecting revenue and paying benefits and credits. The Government department also claims that the majority of places at the nurseries are not taken up by children of HMRC staff.

Commenting on the closure of the nurseries, Carole Edmond, managing director of Bright Horizons, said, 'We have been managing the HMRC nurseries for many years and are very proud of the way in which our staff have supported HMRC employees and their children, together with community families, during this time. It is a very sad time for the staff and families and indeed for all of us.'

Bright Horizons, which declined to comment further, also runs nurseries on behalf of the Department for Work and Pensions, the Ministry of Defence and the Foreign and Commonwealth Office.

The Department for Work and Pensions told Nursery World it has no plans to review its workplace nurseries.

The announcement of the closure of the HMRC settings follows the closure of two Land Registry workplace nurseries on 31 August, one in Nottingham managed by Childcare Enterprise, and one in Durham which transferred last year from Childcare Enterprise to Busy Bees along with seven other Land Registry nurseries. The Nottingham setting is closing as the office on the same site is being relocated and there are no facilities available at the new site for childcare. Durham is not considered 'economically viable'.

According to the last issue of Nursery Chains, The Childcare Enterprise also runs two nurseries for the Department for Environment, Food and Rural Affairs and a playscheme for the Home Office.

Childcare Enterprise's chief executive Julia Wilcock told Nursery World last month that 'the market is changing'.

Other settings run by nursery groups on behalf of Government departments include the House of Commons nursery, operated by London Early Years Foundation, and the Ministry of Defence nursery in Saltash, Cornwall, run by Pixieland Day Nurseries.

While Government department settings appear to be at risk, it seems to be a very different picture for corporate workplace nurseries, claim experts.

Around 40 per cent of kidsunlimited's settings in 2010 were workplace nurseries. The group currently runs settings for the Body Shop, First Direct, Toyota and the National Physical Laboratory, along with hospital and university nurseries.

In an interview with Nursery World two years ago, the nursery group's chief executive, Ros Marshall, said that the 'demand for employer-supported childcare remained high, and kidsunlimited was in discussion with a number of corporate clients to establish workplace nursery partnerships.

Busy Bees, the largest nursery group in the UK, also has several workplace nurseries for companies including Tesco, BAE Systems and Jaguar and Land Rover.

EXPERTS' VIEW

Courteney Donaldson, director of childcare and education, Christie + Co

'All Government departments are worried about budgets, and are likely to be watching their purse strings.

'It is understandable that all publicly funded departments are likely to be examining ways in which budget cuts could be made. Closing highly subsidised workplace settings could be one way for them to minimise expenditure.

'In contrast, we are seeing a growth in corporate nurseries, especially across the banking and finance sector.'

Ms Donaldson told Nursery World that the corporate workplace market remains very buoyant and there are tenders still available for workplace settings.

'Corporate employers are becoming increasingly aware of the benefits that workplace nurseries can bring, in terms of unique selling points in recruiting new staff and having the ability to provide emergency care should a parent's normal childcare arrangements break down unexpectedly.'

Philip Blackburn, economist, Laing and Buisson

'Government department nurseries are definitely at risk. Local authorities, hospitals and universities are all reviewing their costs and seeing where they can make marginal cuts.

'Nurseries are easy targets and seem to be at the forefront unless they are operating at full capacity. However, it depends on how significant budget cuts are as to whether departments decide to close their workplace settings.'

Mr Blackburn went on to say that the closure of Government department nurseries is consistent with the policy of this Government - that is, not to be a direct provider.

'The Government as a whole is disinterested in public childcare and wants to outsource everything. The closure of nurseries run on behalf of departments could continue throughout this Parliament,' he warned.