The UK is facing a childcare crisis. We have the third-highest childcare costs in the developed world.
On average, it costs parents £263.81 per week to send children under the age of two to nursery full time. In Denmark, one parent said they pay just £250 per month for full time childcare. In Canada, one parent told me that they pay $18 per full-time day. Both country's governments subsidise the cost of running childcare to the providers.
However, in the UK, the help is very limited. Working parents can pay for tax-free childcare (for every £8, the government pays £2). In Wales, some people benefit from the Flying Start programme at the age of two (2.5 hours a day), and this is currently under expansion to be delivered to all Welsh children by the end of 2024. There is also more help once a child turns three, where you can claim 30 hours childcare, however one childcare provider told WalesOnline that this massively short-changes the nursery, as the funds they received from the government for children receiving this care, massively undercuts how much it costs to provide it.
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The issue isn't with the childcare providers. They are businesses with running costs and staff to pay who provide a desperately needed and necessary service. They often go above and beyond to care for our children and deserve to be fairly paid. Amy Ferguson, an owner of Fun Foundations Day Nursery, in Cowbridge and another in Llantwit Major, stressed that most nurseries aren't the money-making business that they are often portrayed to be.
She said: "I opened Fun Foundations Nursery in Cowbridge 12 years ago. I was a primary school teacher at the time. It isn't the money-making venture we are so often portrayed to be. If I was still a primary school teacher working in the public sector, I would be making more than what I am now."
Amy, 40, has had to make the hard decision of increasing the daily rate fee for 2023. The decision was partly influenced by the rising cost of living with things like food and other provisions the nursery needs now costing more. When it comes to energy costs, she doesn't even want to know what the yearly figure is set to be after her fixed rate came to an end in October, but admitted it has quadrupled.
"It was £5,600 a year up until now, but it has quadrupled. We pay monthly, I don't even want to know what the yearly total will be but we are doing everything to keep the cost down. We don't have the heating on in the upstairs staff room. Me and the manager in the office, we are literally sat with blankets."
It isn't just the increase in costs of food and energy which is forcing her to put up her fees this year, its the knock on effect of the increase to the national living wage. She said this is the side of the child care industry that people don't consider when they see an increase in fees.
This year, the national living wage is set to increase by 9.7% which will have a big impact on the cost of running her business. It will also increase pension contributions. She said: "We want to pay the staff more, they are amazing. It is about how you value your staff, and they absolutely deserve the money, but where does that extra money come from?"
"We have to have the staff, and we have to make sure our staff feel valued, we are facing a staffing crisis, we can't attract quality staff, they are gone after Covid, how do we retain staff if we do not pay them what they deserve? The reality is it is not a job that people do for the money, they would be better off working in Tesco, it is a job that people do because they love it and they are good at it."
She explained that the only way these increases can be covered for her business is by increasing the childcare fee from £54 per day to £58 per day (an 8% increase). She said: "It is an incredibly difficult decision, it is horrible to make it. For the first five to seven years of our business we didn't make any increases, but since 2017 we have had to increase it yearly."
Discussing the issues with the running costs of childcare in this country, Amy said the 30 hours free childcare offer to parents doesn't help the situation as the funding per hour provided to the nursery is less than it costs to run. So a childcare provider receives £5 per hour from the government for this childcare offer, but the cost of that child to the nursery is more than this.
As a result she and other providers in this situation are forced to fill the gaps with charging higher fees to those under the age of three who aren't entitled to the offer. She described it as a "vicious cycle".
She said: "The Welsh Government say you don't have to participate in the childcare offer, but the reality is we do, if we don't parents will go elsewhere, rightly so. Parents need more support to pay for childcare. How do we expect women to return to work otherwise? And I say women because it is mostly women who lose out on work and pay as a result of the lack of support."
Amy stressed her frustration with the cost of childcare to parents and how she wants the government to do more to support early years childcare between one and three. She believes flying start (where selected, more deprived areas receive 2.5 hours a day in a childcare, with plans to expand this to the whole of Wales), should be scrapped and the money should go towards funding childcare for working families from the age of one.
"Whether it is 10 hours, or 15 hours a week, they need something from that younger age to make sure they can return to work. For so many mothers, returning to work part time for example might put them over the threshold of claiming universal credit, so to them it is just not worth going back, they are sacrificing time with their children to pay for childcare, when they could be receiving the same money at home.
"It is about how our government values mothers and parents in the workplace, and it is not just about the work it is about the support and mental health for mothers. They need the help with returning to work, the support with raising children. It is really frustrating that women are not valued and respected."
She criticised proposed plans put forward by the UK Government (which won't apply in Wales) to increase the child to staff ratio. She described the plans as dangerous and unsafe, but also said they won't necessarily work.
"If you are registered to have 12 under two-year-olds, where the ratio is now one to three, but they increase it to one to four, you may only have nine children in, so you would still need three members of staff, so it doesn't make financial sense. I can't see any provider adopting it."
She said the situation is only going to get worse for parents if there is no intervention to break the cycle and she is urging governments to look to countries like Denmark where more support is provided.
A Welsh Government spokesperson said: “We recognise the importance of childcare and play provision, including holiday play schemes, for children and their parents and believe all workers should have an automatic right to request flexible working.
“We provide 30 hours a week of government-funded early education and childcare for working parents of three and four-year-olds through the Childcare Offer for Wales and we are currently expanding Flying Start childcare provision to all two-year olds in Wales. The ReAct+ programme offers tailored support to help people into employment, including up to £4,550 to help cover childcare or caring costs when training.
“In April we announced an extra £6 million per year to increase the hourly rate for childcare provider by 11% s from £4.50 to £5 per hour from April. The maximum amount settings can charge for food was also increased from £7.50 to £9 a day, reflecting the increase in both food prices and utility and energy prices."
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