Am I being mugged off or is this fair? Funding question..

[Bounty9]

I really am not sure how it all works so I don’t know if this is fair or not.

I’ve been with current CM for about 8 months. DD has received 15 hours funding since September.

In April she will be starting a mix of preschool and CM. I have said to CM I will be moving the 15 hours funding to preschool from April as it works out more cost effective, a bigger saving.

She has said by us doing this, she will lose out on a fair whack of money and will need to raise her hourly rate to make up for it. Which makes it a bit pointless moving the funding over in the first place.

Is this fair? I honestly have no idea what to do to make the most financial sense. She will get 30 hours in Sept if that makes a difference.

She surely should charge you her hourly ratr which should be the same for all children of a similar age. Its unfair if she charges one child x and another 2x. If she is generally putting up her rates then thats fair enough but it dient sound like that's the case?

@MumChp no one asked her to work for free.

This is probably just my naivety because I just thought the government gave that funding to the provider, and if she wasn’t getting it from the government, I’d be paying her it instead - she wouldn’t be losing out. But like I said - I have almost zero idea how it all actually works!

I’ve done the calculations. If I used the funding with preschool, it works out £550 and if I used the funding with CM it works out £680 so not a huge difference, but still £130 more a month for us. But if it massively helps her we could do it till September.

@similarminimer no - she would just be raising it for us, because she gets extra from the gov for the funded children and we would be removing the funding.

You're doing nothing wrong, you're doing what works best for you financially.

But the reality now is that under 3s funding is better for CMs than having private payers or over 3s.

She might have been getting £8 an hour from your funding. For her it makes sense to either up her rate, or replace your child with another funded under 3.

In the end of the day a CM needs a wage.

It's fair for a CM to opt for children paying most. Quite many areas have a lack of CMs.. If so I would go for the money as a CM. They aren't overpaid.

I know she doesn’t, I’m a childminder and have a similar situation. I’m certainly not overpaid, nowhere near.

So if she charges x for all funded children and y for non-funded children that's fair and transparent- but not if its just you

It's so interesting how childcare varies by area. In my town most childminders won't take school aged children and only offer pre-school care. But they do charge upwards of £6.50 an hour.

Mine went to day nursery and a local charity run playgroup (operates term time school hours) before school but after much searching I did eventually find a fab after school CM. Her fees are much higher but worth it.

The funding rate has no monetary value to the parent. So it sounds like instead of increasing her rate she's just said ok I'm getting it for funding hours so won't bother but now she's not being paid it for the funding hours so needs to increase her fees. The benefit from funding is the 15 free hours the op now gets and going forward the 15 she gets from preschool.

What relevance is a gross figure? It's not like they don't pay insurance, fuel, extra heating, training, Ofsted (or agency) food for children, extra cleaning, activities, consumables...your also assuming each child is full time and her funding is as high as her normal rate. Her gross income if full is £22.68 an hour so her actual income before tax and deductions will be more like £12 if you don't include unpaid paperwork and training hours typically another 5 to 10 hours a week. ....more if a child comes in sick.

I'm probably being thick but I don't really understand. If it has no monetary value, then what's the point? Surely OP should only be paying the difference between the funded hours and the unfunded hours. So just plucking a figure out the air, £500 a month for 15 hours, kid attends 30 hours (£1000) then the funded hours covers 15 of those so £500 paid by funding direct to the nursery/CM and parent pays the difference of £500?

Because the government enforces a contract saying that we cannot claim the shortfall in funding rates and that we can only charge a voluntary charge for certain things....not stuff needed to meet the eyfs like paint or paper.

You're saving money, she's losing it. I'd imagine she'd need to replace your child?

Thanks for explaining, so essentially the government funding does not cover staff and business costs, so the business charges additional fees and calls them consumables. I have to say, this is totally alien to me, I never experienced this with any childcare.
But if OP was paying £5.30 per hour prior to funding, and CM hadn't actually advised clients of a fee increase, has this only been applied to children who recieve funding? It all seems a bit murky to me. Pricing should be transparent and price increases notified with proper advance notice.

It probably hasn't happened to the cm before so she didn't plan for it. Now she has it will be in her policies I should imagine.

My guess is that the OP lives in an area where £5.30 is the norm and so the childminder was charging the local market rate. When the funded hours came along, these meant the childminder received more than £5.30 an hour without costing the OP any extra. Then when the OP wanted to move the funding to pre school (which presumably charges more than £5.30) the childminder decided to up her rate in line with the funding amount in order to continue receiving the higher amount.

@jannier my point was it’s shit and woefully undervalued. She has to do this to stay afloat and deserves more but people seem to think childcare should be even cheaper!

It's the lack of transparency that bothers me, if she has to increase her fee to make her business worth it, then that's what has to be done, but it feels a bit sneaky the way it's been done.

Thanks everyone - this has been really helpful. We’ve done the maths and decided to keep the funding with CM til September. Yes it’ll cost us more, but I honestly hadn’t realised she would be out of pocket. She’s very grateful.

She charges the going rate for CM’s in the area - although I must admit I think they all charge far too little and I would’ve paid more in the first place.

How is there a lack of transparency?

The childminder has clearly stated her position: if the OP takes away the funding she will need to raise her hourly rate.

It's hardly cryptic.

Because she has only said this when she has been told the funding is being removed. If her fee was increasing across the board, she should have notified her clients properly, and with advance notice.

This is really lovely to hear. You'd definitely have gone up in my estimation if I were your cm and feel very valued. It's only one term and then in September you can split it.

What would the cost be if you only used the nursery?

Well, yeah. She needs to raise her prices to cover the shortfall from the funded hours being removed, which is exactly what she told them. Completely transparent.