Provider goodwill is running out

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Linda Symons, owner of Kidz Kabin, London, says the 30-hour policy is untenable, and parents should know the truth about the cost


The government is sending a very ambiguous message to parents of three- to four-year-olds in saying it provides 15 hours of FREE funding for all children in this age bracket. 

It gives no explanation about how funding works, and many parents believe that local authorities pay nurseries the actual fees nurseries charge which are needed to run the settings effectively.  

The reality could not be further from the truth. 

Private nurseries are first and foremost businesses, paying staff costs, rent, council tax, electricity, food costs, not to mention investing in new resources.  

Local authorities decide how much the hourly rate they give to nurseries will be.  The rate is decided unilaterally without any reference to nursery fees or collaboration with business owners. It has been well publicised that the sector is seriously underfunded, especially in London where payments can be as little as 33 per cent of actual fees.  

Parents should be informed that nursery places are not free but heavily subsidised by independent nurseries who agree to offer funded places.   

Many nurseries charge a higher pro rata rate for half days than for whole days as this helps to make up the shortfall for the underfunded sessions. 

Nurseries are currently struggling to provide funding for 15 hours a week and it will therefore be totally unsustainable to increase this offer to 30 hours as David Cameron is proposing to do next year. 

Councils tell nurseries that if they don’t like it they can pull out of the funding altogether, rather than address the real issue of paying properly for a much-needed educational facility for young children. I do not know of any other industry where councils dictate the hourly rate they will pay which bears no relation to the costs of the service provided. 

There are, of course, other ways to provide funding. Families could be means tested, pay top-up fees or even receive vouchers which would go towards their monthly fees. 

It is totally incongruous to expect high-quality settings, paying higher than average salaries and investing heavily in resources and facilities to be paid the same hourly rate as a pack-away setting in a church hall with low overheads, and low investment costs. 

If parents want free education, they have the option of sending their children to state schools. The government needs to recognise it is making a huge error of judgement in expecting nurseries in the private sector to continue supporting an unfair and untenable system. 

If the Government believes it should provide free nursery places for all three- to four-year-olds, why has it closed many children’s centres?  It is a great idea IF the Government can put its money where its mouth is. 

In reality it has cut child tax credits, thus saving millions of pounds, and told parents that they will benefit instead from free education. What it fails to tell them is the Government is not paying for this as it has forced the cost onto unwilling nurseries.

The Government is relying on goodwill from the private sector to deliver its unrealistic promises – except very little goodwill exists.

Furthermore, some local authorities are threatening to issue contracts that providers will have to sign in order to be eligible for funding. The contracts will prevent nurseries from offering restricted hours – but the Government is placing so many restrictions on nurseries that most, if not all, will be forced to offer funded hours at a significant loss. This is neither viable nor economic.

Other points to consider:

  • On the continent children do not start formal education until they are six years old and there is no evidence to suggest they do any worse, educationally,  than children in the UK.  Most evidence suggests they do better.
  • Why should parents earning £150,000 receive free child care? 
  • The Government has said that parents (or carers) only need to work eight hours a week – which could even be a weekend job, to access 30 hours of free childcare during the week.  At the very least parents should provide evidence that they need childcare due to work commitments.
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