Jeremy Hunt must pay nurseries the actual amount it costs to deliver “free” places or his childcare expansion plan will fail, experts warned on Monday
It comes after the chancellor admitted he could not give an “absolute guarantee” that the promised free places would be available in time.
Mr Hunt insisted that government plans to offer 15 free hours of childcare to two-year olds from next month are “on track” but could not guarantee all children would get a place.
Labour said the plan was “in tatters”, while many nurseries are expected to be unable to cope with the expansion, leaving parents unable to access the free hours they are entitled to.
Meghan Meek O'Connor, senior policy adviser at Save the Children UK, told the Standard: “The expansion offree hours needs more investment from the UK Government to ensure it can work for families and childcare providers.
“The Spring Statement is a chance for the Chancellor to cover the actual amount it costs nurseries todeliver the hours, and also address the fact there is no childcare support at all for single parents who are disabled or carers and not in work, and those studying or in training.”
Neil Leitch, CEO of the Early Years Alliance, said: “With just weeks to go until the first phase of the early entitlement expansion, we remain entirely unconvinced that this policy is even close to being workable inpractice.”
He added: “As we approach the 2024 Budget, it is absolutely vital that the government acknowledges and recognises the scale of the crisis we are in and takes definitive action to turn things around.”
Paul Whiteman, general secretary at school leaders’ union NAHT, said: “Ever since this policy was announced we have been warning that insufficient funding and the recruitment and retention crisis in the earlyyears could make it difficult to deliver.
“Until the government ensures nurseries have the funding they need to offer more places and pay staff properly, it is inevitable that the government’s scheme will fall far short of parents expectations.”
The government’s plans have been billed as the biggest expansion of childcare in a generation. Under the scheme, working parents of three and four-year-olds are already able to get 30 hours of free childcare.
From September, it will be extended to 15 hours for those aged nine months and above.
Then from September 2025, the government has pledged to offer 30 hours of free childcare for all under-fives.
But research by the Early Years Alliance has found that most nurseries, pre-schools and childminders will struggle to meet the increased demand for places due to staffing and space shortages.
A survey of more than 1,000 early years providers found more than half are already full with a waiting list. Just three per cent of respondents said they had a large number of spaces available.
Mr Leitch added: “Since the expansion was announced almost a year ago, the sector's calls for more funding and support for the sector have fallen on deaf ears. As a result, nurseries, pre-schools and childminders have been left without the staff, spaces and crucially funding to be able to increase places to meet the likely surge in demand. Is it any wonder then that so many are choosing to limit the number of funded places on offer, or even opt out of the scheme completely?”
Purnima Tanuku, Chief Executive of National Day Nurseries Association (NDNA) said: “If the Chancellor wants early years providers to be able to deliver the pledges he made this time last year he should focused on creating an environment that supports them.
“This means fixing underfunding, removing unfair business rates from nurseries and making more capital funding support available to increase the number of spaces available.”
She added that the vast majority of settings (83 per cent) say that their current funding does not cover their costs.
Ms Tanuku added: “This is unsurprising given that the minimum wage alone has risen at twice the rateof Government funding.
“The early education and childcare sector is creative and resilient, nurseries are doing all they can to support children and families. They are keeping fee increases at an average of 8 per cent despite facing staffing cost increases of over 14 per cent.
“The result of historic underfunding and uncertainty is that 73 per cent of settings are operating at a loss or just breaking even – which is not sustainable. We all want to see children being able to access high-quality early education and care because this makes all the difference to their life chances, but this cannot bedone on the cheap.
“The Chancellor must address the huge challenges facing early years providers and focus on measures to support them. We need sustainable funding rates, the removal of unfair business rates and more capital support if providers are going to survive and thrive. This is the only way that nurseries can plan for asustainable future and be able to deliver the increased childcare offer being made to parents.”
Joeli Brearley, CEO and Founder of Pregnant Then Screwed, said: “The Government’s childcare plan is by no means perfect, but it is also not in tatters - the truth is somewhere in the middle.
“Our data is showing that the majority of parents can access a funded place and that this will save them money. However, the savings are far less than was predicted, and there are a number of providers who will not offer the funded hours scheme; in both cases, this is because the Government funding does notcover the cost to deliver the places.”
She added: “We expect the roll out of the funded places in April to be relatively steady - the big issue will arise in September when working parents of children from the age of 9 months old are eligible for 15 hours of funded childcare.“Unless the funding to providers increases, then we will see more providers close and a large number of parents will be unable to access a place.”
