Funded Childcare hours increase

Following the announcement in the Spring Budget in 2023, the proposed childcare funded plans are starting to roll out from next month.

In April 2024, the current 15 hours of funded childcare provision for 2-year-olds will extend to working families where both parents are in employment for 16 hours a week or more, and individually have income of less than £100,000 annually.

From September 2024, this will then extend to children of working families from the age of 9 months old and the following year, in September 2025 this will increase for children aged 9 months and over to 30 hours per week, until children start school.

Although this additional childcare provision should help a number of families financially, and also support parents in returning to work after parental leave, the preparation and changes to funding is causing an increasing strain on nurseries.

It is expected that there will be an influx of parents seeking nursery places for their children from April 2024, and nurseries will need to source of a number of additional staff members to care for the children, which in turn leads to increased overheads.

There are concerns that the increased overheads will significantly override the additional funding that nurseries will receive from the Government meaning that they will struggle with the increased costs.

Nicola Knight, Operations Director, of Zizus Day Care says “A number of nurseries are concerned that they will simply not survive and there are reports of a number of nurseries who have already closed.

“These closures have caused additional strain on the remaining nurseries, who are seeing their spaces fill more quickly and waiting lists are getting longer. Nurseries are reporting that there are simply not enough spaces and not enough staff to care for the children.

“In addition to this, the number of childminders are declining due to insufficient pay rates to care for children.

“Although the government provides the funding for childminders, pay rates are set by each individual local authority, who retain a percentage of the funding to cover their administration costs.

“With Government setting the National Minimum Wage and funding rates, there is little to no allowance for providers to cover the shortfall in the cost of delivering childcare and the rate paid.”

We’ll be watching with interest as these changes are rolled out over the next couple of years and how the providers will cope with the strategy the current Government has deployed to get parents back into work.

To chat to our Family Team please email FamilyTeam@Jacksons-law.com.