Parents facing soaring early years costs while a third of nurseries, pre-schools and childminders warn of likely closure in the next year

COST-OF-LIVING CRISIS: Parents facing soaring early years costs while a third of nurseries, pre-schools and childminders warn of likely closure in the next year, new Alliance survey reveals

“The early years sector in this country is in crisis. As our survey findings clearly show, current levels of government funding are nowhere near enough to support the delivery of affordable, sustainable quality care and education. As a result, nurseries, pre-schools and childminders are being left with an impossible choice: substantially increase fees for parents and carers or go out of business altogether. 

“With inflation still sky-high, and the national living wage set to increase by record levels in just a couple of months, this situation is only going to get worse unless the government takes urgent action.   

“The government talks about the importance of education, of giving children the best start in life, of supporting families and of encouraging people back to work. What possible reason, then, do ministers have for continuing to completely ignore the very sector that does precisely that? 

“Enough is enough. Providers deserve better, parents deserve better and, crucially, children deserve better.  

“It is vital, therefore, that the upcoming Spring Budget includes a clear plan for the future of early education and childcare in this country, underpinned by the substantial additional investment needed to ensure the sustainability of the early years. The sector simply won’t survive anything less.”  

Survey comments: 

“For the first time since the setting opened, we are at risk of closure. I cannot keep paying my staff an appropriate wage when I have to balance increasing bills. I do not want to pass all the costs onto parents, and fear that if I do then their children will not attend so the end result will be the same. I do not understand how any business can be expected to support such a huge percentage increase in salaries. The other options are to reduce how much we spend on food and resources which goes against everything I believe in and the purpose of running the pre-school.” 

“The increase in the national minimum wage will increase our outgoings by £58,000 in the 2023/24 financial year. We have no way of covering this other than increasing fees for parents. This will make our daily fee price too expensive for many families using our nursery. This is likely to reduce the number of children attending nursery and therefore we will continue to make a loss. There is no way out of this situation without more financial help from the government.” 

“We are a setting that has always paid staff above the minimum wage – this has helped us recruit good practitioners who have continued to be employed with us for a number of years. But we have a shoestring budget and have used all our resources to reduce outgoings. We are situated in a deprived area where our provision is very popular and used by the local community but if we don’t receive additional funding, we will have to make redundancies and will face potential closure. Local supermarkets are paying employees more than we can afford. How are our children supposed to get the best start in life if early years settings are not acknowledged?” 

“The pressures are increasing and the hourly rate rising in April puts another nail in the coffin – our rent has also increased by 25% an hour. We have reduced most things and are not replacing staff who have left. It is extremely difficult as we are in a deprived area and are the only lifeline for families who are struggling.”  

“As an employer, we understand the need to pay staff a fair wage that is reflective of the current costs of living. However, as a business, this money has to come from somewhere and we are concerned about the pressure this may put on our setting and operating costs … We are reluctant to increase our fees because of the cost-of-living and the pressure that will put on our families, but we feel we have no choice.”