30-hour childcare offer could close down early years settings in Ipswich, nursery owner warns

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Stock image. - Credit: PA

An Ipswich nursery owner has warned the government’s decision to offer 30 free hours of childcare a week to parents could result in the closures of early year providers in the town.

Chancellor Philip Hammond announced in his Budget this month that, from September, three and four-year-olds in England will be entitled to 30 free hours of childcare a week during term time – twice the amount they currently receive.

The childcare sector has accused the government of underfunding the free hours and forcing nurseries to find extra cash, usually by increasing the fees for additional hours.

It is not compulsory for early years’ settings to accept the 30-hour childcare offer.

Sam Sims, owner of Willow Park Montessori Day Nursery in Tuddenham Road, said they would lose £17,000 over the next year if they implemented the 30-hour policy.

She said: “Ipswich has a really good record of childcare, but that is completely at risk by this shake-up of childcare. We are all concerned and have been communicating regularly.

“The government has announced that parents will be able to access 30 hours’ free childcare from September this year. As a sector, we have been informed by the local authority that our hourly rate for this free childcare is £3.87. This does not make this free, because at this rate nearly all providers are making a loss and we are not allowed to charge parents the difference.

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“That is the biggest issue. It is being sold as free, but it is not, as we are having to make up the difference and can’t charge that difference to parents.

“We all provide high quality care for children and this is now going to be impossible. The result will be that some providers will not be providing the extra 15 hours – and we already provide 15 at a loss – and Suffolk County Council will have difficulty in providing the places the government requires, or it will be settings closing as they cannot earn enough money to be sustainable.”

She said it was her intention not to accept the 30-hour offer, but warned others may accept it due to fears of losing their children to other providers.

Mrs Sims added: “Most providers are offering 15 hours already. If I said to my parents from September I am now offering 30 hours, that means that, if they were to take those full 30 hours, they would pay the nursery nothing. But the cost for us offering those 30 hours is higher than the cost we are getting back from the government.

“It is a choice. At the moment I am going to say no. The other side is, people will say yes, but it is not sustainable and there is a high risk you will have closures of settings because you can’t sustain it.”

Sue Cook, director for children and young people at Suffolk County Council, said: “It is disappointing that Suffolk County Council is one of just 25% of authorities in the country facing a reduction in funding as a result of the government’s new Early Years National Funding Formula. The reform will reduce the hourly rate of funding to providers by up to 9.5% or 37 pence.

“Following a consultation with early years providers and the schools forum Suffolk County Council has taken the decision to offer Early Years providers the highest hourly base rate possible of £3.87 plus a supplement for deprivation of £210.

“However creatively we use the reduced funding, the reality is that schools, nurseries, playgroups and childminders will see a reduction in funding from April 1 2017.

“We are disappointed that the reform has not addressed the significant inequality of funding across the country and our concern is that this will serve to further divide authorities between those that have gained and those that have lost, as a result of the reform. Suffolk County Council will continue to lobby for fairer funding for children in Suffolk.”