Increasing the minimum wage to £15 an hour would be 'disastrous' for the sector

The TUC’s ‘Raising Pay for Everyone’ report details the path to a £15 minimum wage and calls on the Government to work with the Low Pay Commission (LPC) to deliver this target as soon as possible and end ‘low-pay Britain’.

In the report, the TUC calls on Government to set out a minimum wage target of 75 per cent of median hourly pay, and a plan to deliver a return to normal pre-crisis wage growth, at a level equal to or above that wages between 1997 and 2010, which grew by an average of 3.8 per cent a year.

The current minimum wage for those 23 and over is £9.50, with lower rates for those who are younger. 

However, early years organisations said the move would be ‘disastrous’ for the sector.

Neil Leitch, chief executive of the Early Years Alliance, explained, ‘While it is absolutely right that all staff receive fair pay for the work that they do, increasing the national living wage to £15 an hour will be nothing short of disastrous for the early years sector. 

‘There’s no doubt that those in the early years sector deserve to be paid more, they are highly skilled educators and this should be reflected in their pay. But, years of underfunding have pushed settings to a cliff edge, and, with soaring inflation and rocketing energy prices, it will be impossible for settings to remain open if wages rise to this extent.

‘The early years sector has lost over 4,000 providers within a year as a result of sustained financial pressures and amid the cost-of-living crisis this trend will only continue. As such, it is absolutely vital that the Government puts forward a long-term plan for the sector that includes realistic funding so that the desire for better pay does not cripple the vital service our sector provides to children and families.’

Purnima Tanuku, chief executive of National Day Nurseries Association (NDNA), said Government would have to consider funding rates in any response to the TUC’s demands.

‘Nursery staff deserve better pay for the fantastic work they do. However, with all the cost increases, nurseries can only afford to pay higher wages if the Government funding rate for two, three and four-year-olds covers their full costs.’

Liz Bayram, chief executive at PACEY, added, 'The proposed increase in wages will be a double-edged sword for many settings – they will want to retain staff and pay them well but will not be able to do so unless Government addresses the chronic underfunding of early education that has been entrenched for years.'

A Government spokesperson said, 'We are determined to make work pay, and this year’s increase is the largest ever national living wage rise, helping millions of families across the country.'