Almost two-fifths of providers think 30 hours will lead to their closure

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According to the Pre-school Learning Alliance survey, 38 per cent of providers think their business won't be sustainable in 12 months' time as a result of the 30 hours policy.

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The Alliance survey shows two thirds of providers don' think they will be sustainable in a year's time

The survey of 1,394 childcare providers was carried out by the Alliance this month.

One respondent said, ‘We are a non-profit charity and have unfortunately used up all our “rainy day” account so will have to close next July unless some improvement of funding happens.’

Another said, ‘So disappointed I will lose my business, which I struggled to set up initially and have managed to sustain myself in recent years. With rising salaries and [introduction of] pensions it really is an impossible mountain to continue climbing.’

Three-quarters of those that took part in the Alliance’s survey said that their current funding rate will not cover the cost of delivering a 30 hours place. The average funding shortfall is 18 per cent.

More than half of respondents plan on introducing/increasing charges for additional goods and services as a result of the 30 hours. Some 47 per cent said they didn’t plan on doing so, but it could be that some of these providers already charge for extras.

Just under half plan to increase fees for non-funded hours.

The survey also reveals some providers will be putting restrictions on places and limiting the number they offer.

More than 35 per cent intend to introduce restrictions on what days of the week and/or times of the day parents can access the 30-hour entitlement. However, 45 per cent don’t plan on placing any restrictions on places, while 18 per cent said they were undecided.

One provider said, ‘We are limiting the flexibility we used to offer parents, who will no longer be able to take short days, such as 9am-2pm.’

According to the findings, those taking part in the delivery of the 30 hours plan to offer an average of 11 places.

In comparison, the average number of 15-hour places provided by respondents currently is 24. While the figures can’t be directly compared, they suggest that providers typically plan to offer fewer 30-hour than 15-hour places.

One provider said she felt forced into offering the 30 hours by parents ‘ganging up’.

More than 40 per cent of providers said they don’t feel confident that the number of 30-hour places they plan to offer will be enough to meet demand.

Of those that will have a shortfall of places, for most the shortfall is 10 per cent or less. However, one provider said they will have a 75 per cent shortfall.

Neil Leitch, chief executive of the Pre-school Learning Alliance, said, ‘As one of the Government’s flagship policies, the launch of the 30-hours offer should have been a day of celebration. Instead, all we have is a policy in chaos.

‘The Government’s total refusal to tackle, or even acknowledge, the fundamental problem of early years underfunding has left providers across the country struggling to find ways of delivering the offer that won’t force them out of business. As a result, parents who expected 30 hours of ‘free childcare’ to take up when and how they wanted, are now facing additional fees and charges and either unexpected restrictions on when they can take up their places, or a struggle to find places altogether. This is a direct consequence of the complete mismanagement of this policy and it is unacceptable for Government to continue to turn a blind eye to the situation it has created.

‘We cannot wait for this problem to solve itself. Every week we’re hearing of more and more parents struggling to find places that actually suit their childcare needs. Every week we’re hearing of more and more childcare providers being forced to shut down as a result of the 30 hours. This simply cannot continue.

‘It’s time for the Government to step up, admit it got this wrong, and fix the mess that it has made. Otherwise it will be parents and providers who pay the price.’

The Department for Education referred to a second independent evaluation of its early roll-out programme, published today, which shows eight out of ten providers were ‘willing and able' to double their current 15 hours offer. Also, the report found there was no evidence of funding being a substantial barrier to 30 hours delivery.

Education secretary Justine Greening said, ‘High-quality childcare not only helps our children get the best start in life, it supports many parents who want or need to work.

‘For too long lots of families really struggled to manage the cost of childcare and that’s why we have delivered on our promise to provide 30 hours free – saving working families around £5,000 a year.

‘Alongside the support we are giving through Tax-Free Childcare and Universal Credit, it will make a real difference to families’ lives.’

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