THE BLOG

30 Hours: There's No Such Thing As A Free Lunch

26/05/2017 12:23 BST | Updated 31/08/2017 10:13 BST

30 hours 'free' childcare is drawing ever closer and thousands of childcare professionals are in unchartered territory.

Nurseries and childminders want to make 30 hours to work for parents, but they need better funding to be able to deliver funded places and still sustain their business.

Our recent Childminders Fee Survey showed that many childminders will struggle to offer funded hours without experiencing a detrimental impact on their small business.

In fact our survey has shown that if childminders purely offered funded places for two, three and four year olds, many could soon face closure.

The reason for this is the big shortfall between the funding that childcare settings receive from local authorities for these 'free' hours, versus what it actually costs them to run their setting.

So while parents are under the impression they are getting 'free' childcare, every funded child place actually costs a childcare provider money.

For childminders, the average hourly rate is £4.64, but the average amount that the local authorities are passing on is just £4.28 per hour. Meaning there is an average hourly shortfall of £0.36 per hour, per child.

To put this into context. For every 3- or 4-year child that the average childminder offers the new 30 hours scheme to, that childminder stands to lose over £400 a year in income. The fact that childminders can offer up to three places for under-fives, means that their shortfall could increase to over £1,200 per year if they offered three places.

Even by offering just one funded place they could face losing a sizeable chunk of income which could equate to a mortgage payment or a month's food and sundries.

These figures are based on averages and there will be some local authorities' whose hourly rate does cover the full cost of delivering a place; but in most areas the shortfall will have to be made up through a variety of potential supplements and/or by charging for lunch and other extras.

Relying on charging 'extras' is risky for childminders as the government has said that charges cannot be a condition of offering a place; funding supplements are complex and could change in the future. So even if a childminder can make it work now, who knows what the future will hold?

It is vital that the next government quickly recognises that the current commitment to 30 hours can only be achieved with a long term sustainable funding plan which must be subject to regular reviews that consider any increases in business costs.

Their focus needs to be on four key areas: the provision of sustainable funding for funded childcare and early education places; ensuring quality is at the heart of all childcare early years policy and funding decisions; a workforce strategy in partnership with the sector which removes the key barriers to career progression and ensures practitioners are fairly rewarded for the vital role they play; and promoting childcare especially childminding, as a valued and viable career option.

Between now and September, childminders and other registered providers need improved guidance on charging for additional services. They also need effective business support to help them establish delivery partnerships that provide parents with quality, flexible childcare and share the challenges of delivering funded hours. Without this additional support, in three months' time, many eligible families will simply not be able to access the quality care and early education they so desperately need.

In the case of 30 hours childcare, it is clear there is no such thing as a free lunch.