30-hour childcare funding explained

In our Open Days and in communications with parents, we are often asked whether Unity Montessori will accept registrations from families applying to the 30-hour free childcare funding program to be launched in September this year. The following quote is quite pertinent to illustrate our position:

“The average hourly rate that local authorities receive from the Department for Education for the free entitlement is £4.85… The average local authority base rate in 2017-18 –the amount which will actually be passed on to childminders– is £4.28.”

The quote comes from a report produced by the Professional Association of Childcare and Early Years (PACEY), and it refers to childminders, that is, people who look after children at home. The funding from the government quoted above does not even amount to the National Minimum Wage (£7.20 x hour for over 25s).

This creates a distortion and much confusion among parents. Most private nurseries have inescapable overheads (rent, staff, materials, etc.) that make it impossible to operate on government-funding figures. It is very simple really: the shortfall between government funding and real operative costs has got to come from somewhere. It is our understanding that children whose education is government-funded on the 30-hour basis, will not have to pay any top up costs, and nurseries are unable to make additional charges to meet costs. That being the case: who pays the difference?

This is an issue that’s being widely debated. On the one hand politicians are making unrealistic promises, while on the other the media tends to contribute to the confusion, by failing to inform accurately on the figures behind the 15-hour or the 30-hour program. Our view is far from unique: as reported by the BBC, a recent survey done by the Pre-school Learning Alliance (PLA) shows:

  • “74% of the nurseries that responded feel the government has underfunded the scheme”.
  • “38% do not believe their business would be sustainable in 12 months’ time”.

Some nursery operators have even gone on record to claim the “30-hour free scheme is ‘doomed’“. We are just starting our nursery, and while our expectation is that it will grow and become established, we can not afford at present to accept enrolments on the 30-hour free childcare scheme basis.

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