Is my nursery underpaying the 15h funding?

[Jedimum1]

My daughter turned 3 last December. We started receiving funding in January. As she goes throughout the full year, it works out at 11h per week (equivalent 15h term-time only). At the lowest rate, their fees for a full day 8am-6pm are £39 (for those going full time); at the higher rate, the same hours are £50.50 (for regular bookings of two days a week or less). This means that the hour ranges from £3.9 to £5.05, depending on the hours your child do. My child does three days a week, so her hour is £4.5

Am I wrong to assume that, as a minimum, they should pay £3.9 per hour towards funding? As I get 11 hours funded, I am assuming I should get £46.8 per week (11 x £3.9) as a minimum, even though I pay more per hour because my daughter goes three days a week now. They are paying me £41 per week, instead. They say that they get less than £3.9 an hour from the Local Authority, so they are not funding what I pay, but passing on the money that the LA gives to them. Is this right? I thought that it is a sacrifice that they do if they want to advertise free funding places, nobody obliges them to do so. They have also increased the fees in April, with no increase whatsoever to the allocated funding. Is this reasonable?

You should t get anything paid back for funding. You should simply pay for unfunded hours. What are they charging you for the extra hours? Is it fair?

And yes, the government funding could well be less than their normal hourly rate, is of no benefit to the nursery, but is a benefit for the parents. They are doing it for parents, not themselves.

A family member runs a childcare setting, her hourly rate is £4.50, the LA give her £2.80......

She operates at a loss every day when taking funded children. This is precisely why she and many others I know will be unable to offer the 30 hours if the pilot goes live everywhere, as they would be bankrupt!

Had no idea it's as low as that in some areas. Our LA pays roughly £4 an hour.

Our LA pays around £3+ for 3 year olds and £4+ for 2 year olds.

They discount the amount from my monthly invoice, so it shows as a credit in my account. Sorry, when I said they paid me £41, I meant that they discount £41 per week from the invoice. I pay around £4.5/h for her and they discount around £3.5/h, which adds to about £45 a month less than I thought I should have received. They basically discount only the amount they are receiving, as far as I can tell.

The funding year begins in September
There are 3 terms and the fundd hours available are different for each term
The funding available from September to August is 570 hours

Ds1 nursery used to take off 12hrs (4sessions) from our bill he did 2 full days and they basically toom off whatever the funded amount was they got. They also if a child did session 1 (8.30-11.30) and session 2 (1-4) and parent wanted them to stay for lunch they charged £13 for that time to include lunch.

Ds2 nursery he is only 19mths but currently for funded 3+ they take off 15hrs even if you do 2days of 8hrs day they would charge you for 1hr. (Theory have just started charging £5 for lunch if they provide or can send packed lunch as they were making huge losses)

Many providers say thery only offer it as either 5 mornings or 5 afternoons and don't offer 2 sessions in one day

No, it's not correct, because the hours should be completely free.

All LAs do this differently. My LA pay roughly 2k per year, this is split into three terms and paid directly to the nursery who then deduct it from your bill.

Op your nursery do not have to give you fifteen free hours, they only have to deduct what the LA pay them off your bill which I suspect is nowhere near the 3.90ph you pay now.

Other private nurseries who give fifteen hours free are very rare because they make a huge loss, I can't see how it makes business sense to do it that way either

IME, the 15 hours "free" have only ever been in school nurseries, during term time.

In private nurseries I have used, the funding has been given to the nurseries, which then deduct it from fees. It's about £2k per year, and is subsequently used to discount fees.

My DD was 3 in April & is in a private nursery. Her funding will come through in December ie 8 months after her birthday. If I was using school nursery, she would start in August.

I wish the term "15 hours free" wasn't used. It should be re-named as 3-year education funding, IMHO.

It may be what a lot of providers do, but it is not allowed and should not be happening. People turn a blind eye to it because if it was challenged, the providers would cease to provide free hours at all. This is what Hampshire says in their funding policy:

"1.8 Early Education places must be delivered completely free of charge to parents. Therefore, parents cannot be charged for any part of the free Early Years Education either directly or indirectly. Under no circumstance should the Provider levy any fee in respect of the free Early Years Education nor should parents be charged in advance to be refunded at a later date.

1.9 In accordance with 1.8 above, Providers must not include any administration fee or deposit. Any charges for goods or services are not to be a condition of children accessing their free entitlement, for example, but not exclusively, meals, optional extras or required purchase of additional hours or provision outside the free entitlement."

That's unequivocal. By charging the rest of the normal hourly rate to the OP, the provider is not providing a free 11 hours. They are providing a discounted 11 hours. That breaks the terms of the EYE funding from the government. Most nurseries do it and get away with it, but it's wrong.

As was said above the 15 hours should be free to parents. Nurseries can decide on their timetable for offering those hours.

They should be invoicing you for the number of hours she does minus 11

So she does 30 hours so you should be invoiced for 19.

Our nursery does it by translating the 15 hours into 11 and then not charging you for 11 hours of care. The nursery is open 7:30 - 6pm so effectively this is 1 day worth of fees (plus an extra couple of quid off for the half hour!)

I think they can afford it as follows:-

1 . Hardly anyone turns up at 7:31am and leaves at 5:59pm. I'd say ds only goes 8:45 - 5:30 and is probably reasonably average there so we really only get 8.75 hours per day rather than the full 10.5 we pay for.

1. They charge the same rate for under 2s (ratio of 1 adult per 3 kids), 2-3s (1:4) and pre-school (where funding is) (1:8).

We are in a trial area for the 30 hours and nursery are doing it so from Sept our nursery bill is going down massively. It's touch and go whether it would go ahead as at one point all nurseries in the city were refusing but the government is now paying more than they did for the 15 hours.

"Mumoftwoyoungkids

Our nursery does it by translating the 15 hours into 11 and then not charging you for 11 hours of care."

They're still breaking the rules if that is 11 hours per week over 39 weeks per year because they charge more per hour than they are paid by the LA. The only way they can legitimately allocate you 11 hours discount for the 15 hours EYE is if they are providing 52 week care and therefore they've used the 570 hours allocation over 52 weeks rather than 39.

No - they do it over 52 weeks.

In fact we gained with dd as she was born at the end of March so we squeaked into 4 terms of funding but as we got both summer holidays it meant 17 months of the cheaper nursery bills.

Our nursery gives you 12 hours a week every week apart from the 6 week holiday. You cannot just go there on funded hours you have to do additional hours on top otherwise they will not offer you a place.

They then charge you £10 a day for meals only on a funded day.

So for example:

Normal non funded day is £46

My dd does 2 full days a week so thats 6 hours each time of funding plus i get charged £16.83 per day for the rest of the day PLUS £10 a day for meals only.

So its £26.83 a day i get charged instead of the full £46

I think of its a private nursery you just have to go with whatever system they operate. The funded hours are expensive to run as they don't usually cover costs (staffing, building, resources etc).

Wow, thank you so much!
I have had a look at my LA and it does say the same you have mentioned: I shouldn't pay top up fees and it should be free at point of delivery. I also spoke to another mum whose DD has just started receiving funding, and she gets more than me with same hours, I think when they increased the fees they never reviewed the discounts already in place. I'm writing them a formal letter and wait to see what their reply is. The LA has an email address to discuss these concerns with them but I need to contact the nursery first. Will let you know if I get a reply!

When my children were at private nursery the amount of funding was deducted from the bill as you describe, I knew that what Lougle says was technically correct but there's no way a private nursery can afford to provide their services for the amount the LA pays them so I was grateful for a contribution towards the fees and wouldn't have felt right complaining about it.

Maybe it's different now but then private nurseries were used almost exclusively by working parents who could afford to pay the fees and saw the free hours as a bonus. When I wasn't working I sent my children to a playgroup where I didn't have to pay anything on top of the free hours unless I choose to use them for more than 15 hours. They didn't provide anything like the facilities of the private nursery, no meals and only a basic snack because they had to stick to the free funding hourly rate.

I agree with everyone else.
The "rule" is that the nurseries are not allowed to charge top up.
The fact is, in many LAs, they are paid so little per funded hour, they can't survive if they don't find a way round it. Some say they don't, then charge an exorbitant amount for 'meals' or something. Some offset the costs similar to the way your nursery do it, in that they take of the 'cheapest hours'. Some Nurseries will only have funded hours in 5 hour blocks (so the dc can do 7am - 1pm or 1pm - 6pm officially) but most people don't, so they save a bit that way.
Until LAs are made to pay the going rate for any places they buy, this is what is going to happen.

OP - I think its as lifesalongsong said. The vast majority of nurseries simply can't fund genuinely "free" hours so they work it the best way that they can.

The impact of complaining is that yes, of course, the nursery may pay you more especially if you involve the LA.

However, in reality, what is likely to happen, is that the nursery is forced to withdraw from the scheme. Your DD is forced to change nurseries and lots of other parents would leave. Eventually the nursery would close - maybe leading to a nursery place shortage (so only the genuinely free play schools / pre-schools would be available which don't suit the vast majority of working parents).

Most people put up with it because a) they understand that it is not the nursery that is trying to cheat the system, its that they genuinely can't make ends meet (and the problem lies with the local authority / government in the funding they provide), b) if the nursery withdrew from the scheme they'd probably have to pay full fees or go elsewhere.

For £5.80 a week ??