Closure Risk as a Result of 30 Hours Offer?

According to a survey undertaken by childcare charity The Pre-School Learning Alliance, 58% of providers are expecting a negative financial impact on their business as a result of the 30 hour offer with a further 49% anticipating a risk of closure.

The schemes main purpose is to make it easier for parents to work and although that is something the childcare industry welcomes, the figures demonstrated in the survey illustrate the potential harm that will be caused to the sector as a result of inadequate funding and resources. Is it fair of the Department of Education to expect providers to threaten the sustainability of their company at a time when numerous cost pressures are accumulating? It is a business after all.

Significant progress has been made with the 15 hour funding with 98% of survey respondents currently offering this but only 30% are planning to offer the 30 hours. The National Audit Office noted the main concerns surrounding the proposal as being funding apprehensions and a reduction of 2-year-old places to accommodate the 3- and 4- year old places.

Neil Leitch, chief executive of the Pre-school Learning Alliance, said: “We want the 30-hour offer to be a success, for the sake of both parents and providers, but the only way that this will happen is if the government and the sector work together. As such, we look forward to working in partnership with the DfE on addressing these serious concerns and working towards our shared aim of a quality, affordable and, crucially, sustainable early years sector.”

The DfE released an update of one of their policy papers on April 11th which states: ‘Our review of childcare costs shows that there is scope for some providers to improve their business practices in order to develop and grow their businesses and respond to increasing demand’. They have developed a series of insights into business sustainability to help with this. These can be found here

Hopefully the partnership between the DfE and the Pre-School Learning Alliance will lead to a mutually agreeable system to benefit all affected parties. Local authorities are responsible for guaranteeing sufficient free childcare places but information interruptions are prevalent and this can lead to a miss-management of supply and knowledge not only for providers but also for parents. Once the initial concerns have been addressed, this is an area that will require further attention and support.

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