Parents risk losing free childcare as nursery closures loom

Currently, parents of children aged nine months to two years can access 15 hours of funded childcare per week, while those with children aged three to four years are entitled to 30 hours. However, plans to extend this provision to 30 hours for all children aged nine months to four years from September 2025 are in jeopardy.

Early years providers have raised alarms about funding levels failing to account for increased costs, including a rise in National Insurance Contributions (NICs) and minimum wages. Neil Leitch, CEO of the Early Years Alliance, warned:

Unless funding increases to match the rising costs, the most vulnerable children – the very ones these initiatives aim to support – will be left behind.

Nurseries in less affluent areas, which often rely more heavily on Government funding, are particularly vulnerable. Nicci Knight, operations director at Zizus Day Care in Middlesbrough, highlighted that her nursery predominantly serves families claiming Government-funded hours. She said the expected rise in NICs and wages would add £38,000 to their annual costs:

We’re really worried about whether we can even keep the nursery open next year. Raising fees alone won’t cover the shortfall.

This concern echoes across the sector, with many nurseries forced to raise fees for non-funded hours by up to 20%. Yet, these increases may not be enough to offset the financial strain, potentially leading to closures that disproportionately affect low-income families.

For parents, the knock-on effects could be significant. If nurseries close, the availability of funded hours could shrink, and families requiring more than the allocated hours may face higher childcare costs. Some parents may be left with no choice but to reduce working hours or leave employment altogether.

A recent report by Ofsted revealed that over 1,000 early years providers closed in the past year. With further closures anticipated, parents might struggle to find childcare spaces in their local areas.

The Government has promised to align funding increases with inflation, wages, and the minimum wage rise. However, the Early Years Alliance has pointed out that no provision has been made to cover the NIC rise from April 2024.

Ministers are set to meet with childcare sector representatives this week, ahead of the Prime Minister’s announcement of the school readiness pledge. However, experts caution that without immediate action to address the funding gap, these ambitious goals may falter.

Mr Leitch stressed: “The Government is planning its biggest expansion programme in childcare history, yet there’s no strategy to deal with the financial impact on providers. We need urgent intervention.”

With uncertainty surrounding the availability of funded childcare, parents may want to:

• Research alternative childcare options: Look into local childminders or community care providers.
• Stay informed: Follow updates from nursery providers and the Early Years Alliance.
• Advocate for change: Engage with local MPs to highlight the importance of sufficient nursery funding.

As families await clarity, the future of free childcare hangs in the balance. Without decisive action, nurseries fear that closures will leave parents and children struggling to access the care they need.

Read more:

• Ministers scrap ‘free childcare’ label as frustration grows over soaring nursery fees
• Government to address nursery staff shortages before expanding childcare services
• 10 best books to read with your child before starting school or nursery