Nursery 30hrs Free Excess Charges

[Jiff99]

Hello,

We've been sending our child to a London private nursery for the last 18 months for 3 days a week. They turned 3 years old over the summer and we've just been looking through the latest invoice that now supposedly accounts for the 30 (22 per week balanced over a year) free hours he is now entitled to.

The nursery operate an eight hour day, so a total of 24 hours over three days. I'm simplistically thought we'd have to pay for the additional two hours. Or perhaps two hours, plus an additional supplement for food/trips or other extras not included in the government funding.

In all honesty, I can't make head-nor-tail of the invoice but it is a little of two thirds of what I was originally paying - which is quite surprising given 22 of the 24 hours are supposedly "free".

With a bit of detective work, it seems like the nursery might be just subtracting the government payment for the 22hrs (which I understand is a little over £5/hour) from our regular bill.

I accept the fact that £5/hour isn't a very realistic figure for funding a nursery; but the nursery's approach feels like an absolute con. I'd always operated on the assumption that the eye-watering fees (nearly £90/day) went some way to subsidise the "free hours". The thought of enjoying some free hours certainly made paying the monthly bill a littler easier each of the last 18 months and our original selection of the nursery was partially on the basis that they "do the free hours".

As is stands, the rather than 30 free hours, it seems to more akin to "£5 subsidy per hour up to the first 30 hours".

It certainly feels like an absolute swizz.

I'm eyeing a future where we plan to move up to 5 days a week for the 3 year old and have what will be our 10 month old in for 3 days a week.

Having read around, I found a couple of posts from several years ago (when it was only 15hrs) where nurseries were doing similar things. But in the main, it seems like nurseries still find a way to get their money - by limiting hours-per-day or charging for lunch, or just having a limited number of places.

I'm assuming that the approach the nursery is taking is against the rules of the scheme?

Maybe all this is to be expected. AIBU? I don't really want to change nurseries. Appreciate I'm probably a bit naive and should have looked into this earlier, but I'm more than a bit irritated by the situation.

Grateful for any thoughts.

Its 30 hours funded hours not free. Many childcare providers charge a consumable charge on top of the funded hours as the money is only to provide childcare not any extras.

They have to do this as the funding is so low they would all go out of business. Throw in covid as well and you have the perfect storm of a massive childcare crisis brewing in the next couple of years.

I know that. But I'm not being asked to pay a consumable charge.

There is a similar story with NHS dentists who subsidise their costs with private patients, hygienist appointments and so on. It is part of the business model.

It would seem perfectly reasonable for a nursery to say that only X many funded hours can be used per day. I understand other nurseries do that. But not this one.

I just find it very irksome that they advertise their membership of the government scheme and seemingly don't play by the rules.

We pay £2.50 per session. £5 a day. My friends nursery charge £10 if dropped before 9. £10 for the hour between 12&1 and £10 per hour after 4. She ends up paying £30 a day on her funded days. Fees are £55 so she only saves £75 a week. If they haven't stated what you are paying for you can complain/report them. They should state, like my friends, that the hours before 9/after 4 and between 12&1 are not included in funding. If they just deducted £110 from your bill that's not on.
(Side not £90 a day!!!! Ours is £54 and that's recently gone up from £50. Yikes!

Should say that the £5 is for consumables.

Gov.uk say the hours are free. Not funded. Free.

Email the nursery and ask which hours of childcare they provide at the free rate. It may be that they provide 9-12 Then 1-4 Free and all hours around this are chargeable.

Whether or not the govt pay sufficient for these hours is irrelevant. They are free. So they should be exactly that, free

Making any "top up charges" is against the rules and now allowed. If reported the nursery can lose their funding. A few nurseries in my area were charging top ups and once the council found it they either revoked their licenses or made them stop them. Those who has the funding pulled went under quite quickly.

Yep. This is the reason my DD has been pulled out of her private nursery and is starting at a school nursery this week. I will now be paying £15 a week which covers school lunches plus £1 a week for snacks for 5 days a week opposed to almost £90 a week for 3 days at the private nursery. I am lucky that I can rely on DM for the majority of the school holidays.

I'm a childminder but offer funding so can confirm that funding is paid for by the government at a rate they decide (so for me it's £4.05hr) which is often significantly below the hourly rate of a non-funded child (£6.25 in my case). I offer funding for the hours 9:30-12 and 12:30-3pm so a maximum 5 hours a day. Those 5 hours are free in so much as my invoice shows them as free hours, but if someone wants to use the funding I charge an overinflated rate for any childcare outside or in between the funded hours and for a long list of extras. Frankly I'd much rather just say £2.20/hr top up but we're not allowed to for some ridiculous reason. I can't afford to operate my business on a £2.20/hr loss but want parents to benefit from the reduction in fees.
Don't blame the nursery, blame the government for setting such low fees and selling it as free childcare when in fact it should be subsidised.

Unfortunately so many childminders have changed direction and found employment since lockdown and nurseries shut-down that I'd just caution against reporting them unless you can risk losing them altogether.

Are they only applying then free hours to certain sessions in a day?

A nursery I looked at recently would only use funded hours for a 3 hour morning session and a 3 hour afternoon. The wrap around to this was charged at full rates. So even though my child would only go 2 days a week and was entitled to 30 hours, they would only allow me to use 12 of them over the 2 days and I would be billed for the remaining 8 hours I needed to wraparound this.

Many nurseries and childminders have been fighting for years now to get rid of the word 'free' and change it to 'funded hours'. The set rate of around £4 is set locally, by the borough, and varies. Some nurseries get less than £4 per hour, per child and it doesn't cover their cost. By the way, the amount that nurseries receive hasn't gone up despite the fact that pension payments from the employer had to go up, and minimum wage went up as well.

You are within your right to ask the nursery to itemise your invoice in a way that shows the funded hours, and the hours that you pay full fees, as well as any extra costs. These can include food, snacks, drinks, material used during the day such as craft, some nurseries will buy in French teachers or tennis coaches to try and make up for the gap left by the funding being so low.

I used to be a childminder, rated Outstanding twice by ofsted, and I have stopped because of the ridiculous rate at which the government were offering their 'free' hours. They expected me to work for well below minimum wage, which I wasn't prepared to do.

@QueenBlueberries I am looking at training to become a childminder , although I often see a lot of negative comments about it lately, so trying to get a clear picture before I jump in.

Could you have just not offered the "free" hours or only provided care to under 3's or over 4's?

[quote emelsie]@QueenBlueberries I am looking at training to become a childminder , although I often see a lot of negative comments about it lately, so trying to get a clear picture before I jump in.

Could you have just not offered the "free" hours or only provided care to under 3's or over 4's? [/quote]
You could not provide the hours but families will either move from you when their child turns 3 (well the term after they turn 3) or they will go elsewhere from the start.

This really needs to be rephrased as subsidised or funded hours. A lot of councils have now changed their advertising to funded hours now. Providers should be able to charge "top ups" without all the different "consumable" charges and the hours you are allowed to use the funding. It would make it a lot clearer for parents. We pay a consumable charge which the exact amount of the difference between the funding and the hourly charge lol. I don't mind paying it, people have to live and its not like most eyfs are rolling in money! When pensions, minimum wage etc.... have all gone up something has to give.

It is a bit of a con as they are just over inflating the hours either side of the "funded/free" ones which isn't the point of it at all - why would I want to pay £10 per hour when the childminders/nursery stated fee is £6 per hour?!

You would be better putting the child into a preschool using the funded hours - don't stretch it over the year - just the term time and using your annual leave for the pre school holidays. Then find a childminder who does pick up and drop off only at their normal non inflated rate. Or using pre school for morning and their wrap around care for the afternoon. That way you won't feel taken advantage of

Luckily in my area childminding rates are around £35 per day so actually my childminder didn't lose any money by offering 30 hours

As a childminder I only offer the funded hours during term time and I charge a £1 per funded hour the parents use with me, this covers all the extras but not meals as parents provide them.. The money from the government is over a £1 less than I charge. I am not prepared to subsidise other peoples care so if they don’t want to pay the £1 they go else where. If parents use a nursery, preschool etc and I take, collect or they need Those hours with me in school holidays or if pre school etc shut they are charged my normal hourly rate to hold the space. I also charge my normal hourly rate during school holidays and for any hours on top the funded they do. I hate funding the paper work is a nightmare I don’t normally only offer it but my current families want there younger babies with me so have no choice.

It's difficult isn't - if there weren't help for working parents to go back to work then more parents would be stay at home parents therefore hugely reducing demand for childminders/nurseries etc so naturally costs would decrease or places would close etc.
Or people would be forced to decide not to have kids because they can't afford them or only have one - also affecting supply & demand

I do think though the rates charged in London are outrageous - £90 per day for a nursery and I've heard of childminders charging £60/day plus - they are never going to get close to what the LA pay for funded hours at those rates? In my area nurseries are around £55 and childminders £35 (though some go up to £45).
You still need tax free childcare assistance though to help pay but finding childminders signed up to that is impossible (although not sure why - I'm pregnant with twins and just reserved full time spaces for them for next year - their new childminder said she has never had a problem being paid via the tax free account system)

ivfbeenbusy we use tax free childcare with a childminder. It is very easy to use and our childminder says she gets the payment within 3 days of us paying it.

Our bill has gone down by £120 a week with the funding and I am very happy with that help. We are in childcare for 47 hours a week though, so it is easy for our childcare to work our invoices out.

@ramblingsonthego

Thanks. My older Childs childminder refused to sign up to tax free childcare as she "didn't like the HMRC knowing her business!" 🤔🤔🤔 so it became really awkward and it's been difficult to find other childminders who are part of the scheme (I'd say 50% or more in my area aren't signed up and won't even when I dangled they carrot of two full time children which would be over £1k a month in income to them)

[quote ivfbeenbusy]@ramblingsonthego

Thanks. My older Childs childminder refused to sign up to tax free childcare as she "didn't like the HMRC knowing her business!" 🤔🤔🤔 so it became really awkward and it's been difficult to find other childminders who are part of the scheme (I'd say 50% or more in my area aren't signed up and won't even when I dangled they carrot of two full time children which would be over £1k a month in income to them) [/quote]
And I wonder if said childminder moaned that she didn't get any self employed grant over the covid19 crisis! If they are accepting funding they already know her business lol.

What are the hours you are paying for?

We were paying for 10 hours a day. 8am - 6pm even though we only used 8.5 of those hours.

So we had 20 odd hours free and the remainder were laid for. This was at a higher rate than we would normally pay but still saved us a lot of money.

Remember also that some months are 5 weeks. So the cost in these months is considerably higher than other months.

What is your weekly charge?

The payments from HMRC are often delayed. So you can work for a month, and have to wait another four weeks to receive the 'tax free' money. It messes up with your planning, outgoings, just basic budget.

When the 'funded' hours were introduced, we'd receive payment once a term. How are we supposed to pay our bills with being payed up to 4 months in arrears? The system is better now but it has taken a long time for local authorities to change it and required a lot of pressure from nurseries and childminders.

I have never had a problem if the tax free payments, if the parents pay into their account before 2pm I have it the next day unless a bank holiday is involved then it can be a few days later. The only information I had to give was Ofsted number, address and bank details. Is your childminder getting confused with Universal credits as I have heard that the parents have to pay you first then claim it back which can take up to a month for them get their money back.

@QueenBlueberries

My childminder was paid the entire term upfront for funded hours - not in arrears

Her hourly rate £3.50 - LA funded hours £3.75 so she actually got more money if she offered funded places

Haven't rtft but this properly people pissed me off too. I didn't change the hours, got a huge shock as also assumed 15 hours were free. I actually saved a small percentage, but it felt very underhand due to the difference in how it was marketed and how it was practiced! I tore myself up in knots trying to make head or tail of the invoices and it was like getting blood from a stone to get a funded hours price list. Like you OP, I was paying eye watering fees. It was from a big chain nursery. It would be much more palatable if nurseries were upfront about the real cost.

I think it would help if nurseries were a bit more transparent in their fees, I've asked many times for a breakdown but nobody at my DDs nursery seem able to explain the figures and it is a bit of a shock when you're expecting a big drop in fees when they turn 3.

We pay around £300 pm for 23 hours a week in a northern 'working class' town plus any extra lessons like dance or swimming