I appreciate there are many threads on this, and up to know I thought I had a good understanding of this, however on looking at a
new nursery today, this pricing was very unclear until i dug a little deeper and asked for a breakdown. On the surface all they
currently report is day and half day rates so I wanted to understand the breakdown.
I would appreciate if you would let me know if you think the way the Free Childcare hours has been used is not only in the spirit of
the policy but also if this is even legal?
The example is as follows
Nursery fees lists
- £69 per day
- £47 per half day
- Calender month full time = £1,420
(this is a reduction on the daily rate which would be £69 x 5 (no of days) x 4 1/3 (no of weeks in calender month which comes to
£1,495, therefore a full time place gives you £75 per month saving).
However, when I enquired about the 15 hours per week in term time (or 570 hours per year, or 47.5 hours per calender month), they
said the monthly pricing would be reduced to £1,282 (a saving of only £138 over the fee above).
From calculations, this works out at a rate of only £2.90 per hour they are passing on to parents, even though I believe they are given £4.93 by the Government.
I have challenged this, and they came back with how they calculate it, which roughly is as follows, this was over the phone so do not have exact workings as yet
- as you get 15 hours a week, they provide you with 3 x 5 hours (so 3 x 1/2 days free per week)
- therefore, on a 5-day week they give you 3 mornings for free, meaning you only pay for 2 full days @ £69 per day
- however for the other 3 remaining 1/2 days, they now charge you the half day rate of £47 per half day
- they also split the sessions over three days, where as giving 2 free sessions on Monday and 1 on tuesday would mean a saving of
over £110 per month as shown below
Their model
- 2 full days x £69 = £138
- 3 half days x £47 = £141 (plus they 3 free 1/2 days equal the 5-day week)
= £279 per week (or £1208 per calender month, this is under the £1282 they quoted as you do not get the 15 hours every week, so they factor that in)
If they counted a monday as 2 sessions, and the third session of 5 hours on the Tuesday it would be work more in the parents favour as follows, you would then pay for
- 3 full days x £69 = £207
- 1 half days x £47 = £47
= £254 per week (or £1100 per calender month)
So, depending on how you allocated the days, and how they have manipulated the pricing, they are taking an extra £100 off you which
in my opinion was designed to save the parent money, not provide extra funds to the nursery.
One last example,
- if i just pay in cash, they cost is £1420 per month
- if i use the 15 hours entitlement, they get £1282 per month, plus 47.5 hours x £4.93 from Govt) = £1,516 per month
So they are profiting to the tun of almost £100 per month from a scheme which is meant to benefit parents., and not passing the savings on to the clients.
Any thoughts or comments?