I’m a nursery owner – free childcare expansion could ruin me

The day that then Chancellor Jeremy Hunt announced 30 hours of free childcare for all households in England earning under £100k, I sat in my car and I sobbed. 

It was pure frustration. I have no problem at all with the notion of the government helping parents with the cost of childcare but as the owner of two nurseries in Swindon, one of which I’ve run and worked at for 17 years, I feel so let down. 

At the time Hunt set out the plan, there was no detail on how funding shortfalls would be tackled, but it meant that, from this September, almost every single child in my nurseries would be entitled to funding for a place. The amount of free hours available would double and the age range extended to children over nine months. I did not hold out any hope that Labour would reverse the policy as it’s undeniably popular with parents and I remember wondering, ‘How am I going to make this work?’

Early years settings were already struggling with 15 free hours for three- and four-year-olds. Our costs have gone up every year but funding has not kept pace: personally, my nurseries received an average of £4.70 per child over nine months per hour in 2017, which has risen to £5.57 this year, a 19% increase in eight years. In comparison, the National Living Wage has risen by around 56% in the same timeframe. 

In some ways, I feel the government is being deliberately antagonistic by telling parents that childcare is ‘free’ whilst knowingly not paying the providers enough to make that a reality. 

At present, my nurseries are using the additional funding from babies (who are funded at a higher rate) to partially subsidise the underfunding from the three-year-olds, but we are still running at a deficit and legally, we can only have three babies per staff member, so staffing costs are high, too. At some point, the maths stops working. 

I hear a lot of politicians say that ‘every child deserves the best possible start’ – that is not just a political sound bite to me.

It is something I have lived and breathed for decades and it’s my motivation for staying in the sector. Even with so many challenges, I know our children are getting the best that we can give them. 

This year we are currently trialling no longer offering places to three- and four-year-olds who haven’t been with us since they were either babies or two because we can’t afford to give away free hours for less than it costs to provide them. No business can survive that way. 

More than 400 nurseries across England have already closed due to the funding gap. 

The emotional impact on staff, children and parents of closures is massive and families lose out on choices of settings, something that is compounded by a staffing crisis across the sector.

I think parents, on the whole, are really supportive of settings like mine, but many don’t initially understand the funding gap, or that early year settings rely on voluntary contributions for things that the funding doesn’t cover, like food and nappies.

At our nursery, everything from meals to wipes, suncream to emergency medication and special celebration activities are all voluntary. Most settings are charging for these and some have put their private fees up significantly to include their cost.

Unfortunately, we are going through a slight honeymoon period where the families who are receiving this extra funding feel that they are receiving something really positive, something that families with older children didn’t receive.

They’re very grateful for it but the government has promised it all for free so there is a cohort of parents who expect to not pay anything at all. 

Providers are not supposed to tell families the monetary values of funding that we receive, and as a result, parents think we are receiving full funding while still asking them for extra money for things like food and nappies. 

On social media, it’s not surprising to see many parents asking things like, ‘Is my nursery ripping me off?’ and ‘Should I be getting a refund?’

I have spoken to so many politicians at events and written to the Department of Education, telling them that problems are brewing.

I would like to see the government say that settings can create mandatory, conditional charges for the things that the funding doesn’t cover and of course, I would like to see higher governmental funding too, but it’s complicated: there is no single figure I can point to for how much nurseries need. My two businesses are in the same town but have vastly different costs due to factors like rent.  

We pay the bills, we know childcare is expensive, and that free hours aren’t going anywhere.

Yet as a provider I am on a constant rollercoaster of thinking, ‘Can I make this work?’. Knowing that many providers won’t be able to is heartbreaking. 

Until our figures don’t work any more, we will be here doing our best, for our little ones. I don’t know how much longer that will be.

Do you have a story you’d like to share? Get in touch by emailing Ross.Mccafferty@metro.co.uk. 

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