30 hours free childcare hitting both parents and providers

A new survey has revealed that the 30 hours funded childcare offer has led to increased fees for nearly half of parents, with four in 10 providers fearing closure within the next year as a result of the scheme.

The Pre-school Learning Alliance survey, which received 1,662 responses from nurseries, pre-schools and childminders in England, found that 42 per cent of providers feel that there was a chance they could closed within the next academic year due to the 30 hours offer and underfunding.

The charity claims that 48 per cent of these providers said that they had increased their fees as a result of the 30 hours offer, 42 per cent said they had introduced or increased charges for additional goods and services and 34 per cent of providers are planning to increase their fees in the next 12 months. A further 19 per cent said the were planning to introduced additional charges.

Meanwhile, Mumsnet surveyed 1,143 parents of three- and four-year-old children and states that 45 per cent of parents accessing the 30-hours offer had been asked to pay increased fees for non-funded hours since the introduction of the offer.

The findings follow a warning from the Trades Union Congress which reported that childcare costs for children under five are increasing faster than wages, with average fees for childcare having increased 52 per cent since 2008, while the average wage has gone up by just 17 per cent.

Neil Leitch, chief executive of the Pre-school Learning Alliance, said: “The fact is that even those providers who are technically managing to make the 30 hours work are often only able to do so by introducing or increasing additional fees and charges. Is this what the government meant when they promised parents 30 hours of ‘free childcare’?
 
“And while better parents may be able to shoulder these unexpected costs in the short-term, those on the lower end of the income scale are the ones who are likely to suffer as a result. Worse still, things are only going to get more difficult, with early years funding levels frozen until 2020 despite the fact that provider business costs like wages, mortgages and rents will inevitably rise over this time.
 
“How many increasingly expensive ‘additional costs’ will providers be forced to introduce, how many providers will be forced to close their doors, before government admits there’s a problem? The inescapable fact is that, as these figures show, without urgent action, the 30 hours policy is simply not viable in the long term.”

Justine Roberts, founder at Mumsnet, added: “The idea behind giving working parents 30 free hours of childcare is, in theory, a good one. Even part-time childcare can be higher than the average UK mortgage bill, and Mumsnet users tell us it's often a real barrier when it comes to getting back to work. But any scheme needs to be backed up by sufficient planning and funding and our users are telling us this simply isn't happening. Given the benefits working parents bring to the economy it's not good enough that nearly half of recipients are having to pay additional fees for non-funded hours.”