Charge for extras to make 30 hours viable, Minister tells nurseries

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Early years minister Caroline Dinenage has told private nursery owners that they must charge parents for additional services if their viability is threatened by 30 hours funding rates that are less than the fees they charge outside the free entitlement.


Michelle Drury, Julie Fowler, Caroline Dinenage, Julie Carling, and Nic Dakin, Labour MP

In a recent meeting with three day nursery owners from north Lincolnshire, Ms Dinenage argued that funding rates had been increased. However, she responded to their claims that they could not cover their outgoings once hours rose to 30 a week by telling them to charge for extra services.

The nursery owners – Michelle Drury of I Learn Education, Julie Carling of Little Tots and Julie Fowler of Peekaboo – told Ms Dinenage that the word ‘free’ caused confusion and controversy. ‘By the minister’s own admission, early years providers must charge for additional services to remain viable, so this is not “free” to parents,’ said Ms Drury. ‘Although she agreed that this caused confusion, she said that the Government would not remove the word “free”.’

The Government has said that funding is to cover the cost of delivering the free childcare, and is not intended to fund the cost of consumables (such as drinks, meals and nappies) or additional services (such as yoga, music lessons and trips). Providers are free to charge parents for such discretionary items provided they are not compulsory, but this cannot be a condition of taking up a place. The level of these fees is a matter between the provider and the parent, according to the Government.

Many nursery owners believe that further guidance is needed on exactly what can be charged for, however.

The owners also told Ms Dinenage of their concerns that private nurseries and pre-schools were closing because schools were taking more two- and three-year-olds. ‘Ms Dinenage told us that it was not the Government’s agenda for early years education to be delivered in school settings,’ said Ms Drury, ‘and she advised us to speak to our local MPs to challenge the local authorities on this.’

The three owners are looking to set up a national forum with at least one nursery owner, pre-school and childminder from each local authority to meet and work together to challenge LAs with the support of local MPs.

‘We must change our business models to try to make the system work for us; we must charge for additional services to prevent providers facing closure,’ said Ms Drury.

The owners also discussed their work with vulnerable and disadvantaged families with Ms Dinenage, telling her about the social issues that they manage, the parental support they provide and the safeguarding and child protection challenges they face, with much of the support they offer unpaid. ‘It is not unreasonable to want to cover our costs,’ said Ms Drury.

She warned that extending the hours of three- and four-year-olds could lead to a drop in funded places for disadvantaged two-year-olds, which could eventually mean more children entering the criminal justice system.

‘Not only is the sector facing the crisis of underfunding, this funding rate is being fixed for three years, regardless of the increase in Living Wage, the introduction of pension contributions, the increase in business rates and inflation. We are employing experienced staff to provide quality childcare, while working with parents to ensure affordability,’ added Ms Drury.

A DFE spokesperson said, 'This government is investing a record £6 billion per year by 2020 into childcare to ease the financial burden on working parents. This includes an additional £1bn per year to support nurseries, pre-schools and childminders in providing high-quality childcare – which, together with our new funding formula, will also mean the vast majority of providers will see an increase in their hourly rates.

'Providers can charge parents for additional services, but this cannot be a condition of taking up a free 30-hour place. We are trialling our new offer in a number of areas across the country and thousands of children are already benefiting.'

The DfE was unable to give a firm date for when guidance on extra charges would be published.

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