麻花影视comments on extension of Childcare Business Grant Scheme

3rd December 2014

Commenting on the planned extension of the Childcare Business Grant Scheme, Neil Leitch, chief executive of the Pre-school Learning Alliance, said:

鈥淲hile we welcome any additional investment into early years, the extension of the Childcare Business Grant scheme announced today is unlikely to have a significant impact on the sector.

鈥淭he fact that the government believes that the grants on offer are enough to support the start-up of a new childcare business suggests a very limited understanding of the costs associated with running this kind of provision. Given that they are still set at such low levels, they are unlikely to provide any real financial support for childcare businesses faced with rising rents, utilities, insurance, staff, training and resource costs, as demonstrated by the low take-up of the existing scheme.

鈥淚f the government wants to ensure the sustainability of new and existing childcare businesses, it would do better to direct additional investment into the chronically- underfunded free entitlement scheme. As our recently-commissioned research on the initiative showed, government funding currently only covers four out of every five childcare places, with providers forced to make up the shortfall. This is clearly not a sustainable position, and in the long term, is likely to impact on childcare affordability 鈥 as childcare providers are forced to push up their fee levels 鈥 and availability, as more and more providers opt out of the free entitlement scheme in a bid to stay afloat.

鈥淚t is crucial, therefore, that the government addresses this issue as a matter of priority if its aim of affordable, accessible and quality childcare is to be achieved.鈥

For further information, please .

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Notes for editors

  • The government has confirmed that it will 鈥渇und a 拢2 million extension of the existing Childcare Business Grant scheme to cover 2015 - 16, doubling the funding available through this scheme to support the creation of new childcare places. Read the full Autumn statement.
  • The Counting the cost study, commissioned by the 麻花影视and carried out by independent research agency Ceeda, tracked the resources expended in delivering 186,712 hours of early years education and childcare for 5,635 funded and non-funded children over a two week period: 23 June to 4 July 2014. Profile data collected in anonymised staff and child registers was linked with detailed records of activity in daily room diaries, completed over this period.
  • The study found that:

- The average hourly cost of providing a funded childcare place for a three or four-year-old was 拢4.53, compared to an average funding rate of 拢3.88 - a funding shortfall of 18%, rising to 21% when the cost of unpaid staff hours was taken into account.
- The average hourly cost of providing a funded childcare place for a two-year-old was 拢5.97, compared to an average funding rate of 拢5.19 - a funding shortfall of 15%, rising to 18% when the cost of unpaid staff hours was taken into account.

ABOUT THE ALLIANCE

  1. The Pre-school Learning 麻花影视is the largest voluntary sector provider of quality affordable childcare and education in England.
  2. Through direct provision and its membership of 14,000 nurseries, sessional pre-schools and parent and toddler groups, the 麻花影视supports over 800,000 children and their families in England. The 麻花影视also develops and runs family learning programmes, offers information and advice, runs acclaimed training and accreditation programmes and campaigns to influence early years policy and practice.
  3. For information about the Pre-school Learning Alliance, visit our website:

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