The head of a childcare company backed by the prime minister’s wife has attacked the government following the autumn statement, accusing ministers of letting nurseries go bust.
Rachel Carrell, the chief executive of Koru Kids, criticised a failure to allocate extra money for the childcare sector despite many providers saying that they could go out of business under changes brought in earlier this year.
Jeremy Hunt announced at the budget in March that he would allow more parents to benefit from 30 free hours of childcare, extending the offer to children aged nine months and over. The chancellor allocated £4bn to pay for the expanded offer, but many providers have said this will not be enough to prevent them going bankrupt.
Carrell said on Wednesday: “The childcare sector is in complete disarray with nurseries going under, childminder numbers plummeting and parents facing enormous bills and waiting lists.
“Given this, it beggars belief that a ‘growth budget’ did not have anything at all for childcare … It’s as if they do not connect the issue of childcare with economic growth at all – even though clearly childcare underpins parents’ ability to work.”
Koru Kids, a childminding agency, benefited in the budget from a pilot scheme that offered £1,200 for anyone who decided to train as a childminder through such an agency.
The company’s links with the government came under scrutiny following that announcement as Rishi Sunak had failed to disclose on the public register of ministerial interests that his wife, Akshata Murty, was a shareholder. She is understood still to be invested in Koru Kids.
Murty’s investment has not been enough to shield the government from criticism on this occasion, however, as Carrell joined the growing ranks of experts warning about the risks of not allocating more money to childcare providers.
Sarah Ronan, the director of the Early Education and Childcare Coalition, said ministers should significantly increase the rates they pay to providers to offer free childcare places. “Failing to do that is placing providers in a perilous financial position and is likely to lead to more closures at a time when the government should be shoring up the sector,” she said.
Joeli Brearley, the chief executive of the campaign group Pregnant Then Screwed, pointed out that Hunt had spent money on tax breaks for pubs, but none on childcare. “The irony of an autumn statement on Equal Pay Day which prioritises pints over childcare was not lost on us,” she said. “The government clearly thinks the crumbs they offered parents during the spring statement is enough – it is not.”
