Government payment to nursery for funded hours

[forwardsandbackwardsandup]

Our nursery has changed owners and the fees are sky rocketing. I have found what I think is the answer online, but hoped a nursery worker might be able to confirm. How much can the nursery claim from the government for the funded hours? We're in Scotland and I found info saying £5.79 per hour and £3 for lunch for our local authority. They are charging us £50 per day for 10hrs, so does that mean they can only claim £50? Or that they're getting £60.90 (£57.90+£3)?

I've read threads saying that govt contributions don't cover their costs, but in this case it seems they do? Appreciate it might be different in different parts of the country. They are wanting to add on fees of £3 per session (each half day) for funded sessions only to cover resources. Trying to work out if they really need this to cover costs or whether they're money grabbing chancers!

There are two things going on here:

• the govt doesn't provide enough funding to nurseries
• my nursery's new owners are increasing costs far beyond inflation

I don't know if I'm getting my point across particularly well. If they need top ups cos the govt isn't paying them enough that's fine, they need to articulate that properly to parents. But if they're able to claim £5.79 per hour which is what the govt website suggests, then the extra fees seem unnecessary and greedy. Yes, they're running a business and are in the enviable position of being able to call the shots on their prices as they know there's little parents can do to complain.

I can afford £60 a month, begrudgingly. Plenty couldn't.

A friend of mine used to run a nursery, which closed a few years ago because they couldn't afford to keep going. She said one of the issues was that the government funding was just about enough as long as every space was taken. So if she had to have, say, 1 adult per 8 children, then she needed 2 adults whether she had 9 children or 16 children. Obviously she then had a shortfall if a child left and their funding was no longer coming through.

They also had to pay a fortune for emergency staff if someone was off sick, for instance, and that really ate into their budget some years.

Plus they sometimes had one-off expenses, such as replacing a sofa which got damaged, fixing a radiator etc.

“If they need top ups cos the govt isn't paying them enough that's fine, they need to articulate that properly to parents.”

But I don’t think they are allowed to do this explicitly. It’s all unspoken.

Yes this. The government aren't paying them enough to provide everything

I completely agree with you agree. £5 an hour for child care is offensive to the providers, and yet you still have op here aging about paying for it. I feel for you

I think you’ve been lucky up until now not to have had to grapple with this issue. I honestly don’t think the new owners are making a big profit off the extra charges, but they do need it to be a viable business. And costs are sky rocketing for all sorts of reasons.

Or I'm paying £15 a week to be able to have full year childcare vs term time only.

This is the crux of it. My DC are older and out of the expensive childcare years but it’s been the case for a very long time that if they go to a year-round private nursery rather than a council preschool term time only setting that the ‘free hours’ are not truly ‘free’ to you per month - there’s always been an extra to pay.

"my nursery's new owners are increasing costs far beyond inflation"

But their costs are probably going up beyond inflation as well. Electricity costs have gone up way more than 10% etc.

Yes, there are new owners and they would like (reasonably) to make a profit. It is also possible that prior owners (if eg it was family run) didn't pay themselves a proper admin salary etc.

It sounds like they were at the lower end of market in your area, and now they are charging upper end of market to new parents and mid market to existing.

@yetii £5 per hour is not offensive to the providers if they literally charge £50 for a 10hr day. It's also not offensive if the government is paying them £5.79 per hour. There's a discrepancy here and I'm trying to work out why.

I don't get attitudes like this,

You pay £60 a month for childcare. That's nothing. You knew how expensive children were when you got pregnant (twice) so why should a provider want to look after them for free? Because they're the next Stephen hawking? Or just because '£60 a month is extortionate'

I know people who pay £60 a week for dog day care.

You could always give up work and save yourself £60 a month by looking after your own children??

As I said above, I think that the true charge is the new parent charge i.e. £5.50 per hour. They just want to step it in for existing parents.

Yes, or I could continue my career and contribute to the tax pot, to my pension pot, to show my kids a good example and all the other good reasons why I should work.

Or you're right, I could sit at home for the sake of £60 a month. And that's it, I won't do that. So they can charge whatever they please.

And don't give me "you knew how expensive children were". You sound like these brainwashed Americans you are defending their employers who only offer 6 weeks maternity pay "cos why should they pay for me to have a child" 🤯

Surely £50 a day is quite cheap? For what it's worth, around here, for an older child for a holiday club at the leisure center is £27 for 10 to 3. That works out to be £5.40 an hour. They have a much lower ratio of adults to children (something like 1 for a group of 10-20 kids). No lunch, no snacks and take your own water bottle.

I really doubt they’re getting £5.79 per hour.

But also, even if they were, they’re only getting £5.79 per funded hour, which are capped, so it’s not the same as getting £55 per day for a full time year round place. Your child is taking up 2.5 days a week for ‘free’ and that’s a place they cannot offer to e.g. another parent who wants 4 days a week at £55 per day. Your child is less valuable than the 4-day-a-week child in that sense.

Have you never had to pay top-up for a year-round place before now? Or are you only just getting the free funded hours for your 3-year-old so this is all new?

Why are you so against paying for your children to be looked after? It's a luxury. It's not a right. The government put in some support because it benefits the children. There is probably an option somewhere for it to be completely free for you but it would be stupid hours and you'd have to provide lunch and anything your child would consume.

Yes it will exclude things like the lunch hour. Breakfast starts.

You only get 38 weeks out of 52 as ‘free’ so there would always be extra fees due…

There seems to be an attitude that childcare should be absolutely free. I don't understand that attitude at all. Childcare isn't run by the state, they're (in the main) privately run businesses which are forced to give underfunded free hours.

I'm shocked at how little you pay OP. My fees were £1500 a month and went down to £1040 a month with free hours. I never ever expected to get free childcare for one let alone two kids. You pay substantially under minimum wage and I can't imagine for a minute that you truly believe the free hours cover everything the nursery needs.

It would be much better if the government didn't call it "free" and instead called it "help towards childcare costs"

It really would!

There seems to be a fair amount of disbelief at the £5.79 figure. It's buried deep within an enormous wall of text on a gov website but I've no reason to not believe it? I found the English figures first and most were just shy of a fiver. The Scottish government is much bigger on providing for our children and investing in their futures so the higher amount doesn't surprise me.

Perhaps I've been naive in believing that the funded hours truly meant free. When the funded hours started last year I paid nothing over and above them. Now it's £60 a month. Does no one else think this is a massive leap?

Yes, I pay under minimum wage. If I was paying a nanny for 1 on 1 care I would be expecting to pay over minimum wage. But they're getting £40 per hour assuming the 1:8 ratio is correct. If someone is paying £75 a day then they're still paying under minimum wage, so not convinced that's a valid argument.

No. I don't think it's a massive leap at all.

You sound like you really don't value the nursery in any way. Perhaps move your kids.

If your child gets 30 ‘free’ funded hours, x38 weeks, that = 1,140 hours.

You use childcare 22.5 hours a week x 52 weeks = 1,170 hours.

So there are 30 hours across 52 weeks you must pay for at a minimum.

£50 per day/10 hours a day/£5 an hour on your ‘legacy parent’ rate.

So 30 x £5 = £150 across 52 weeks.
That’s £7.50 a month.

You’re paying £60 a month.

The extra £52.50, just over £12 a week or £4ish a day, is for resources’ and things a council nursery won’t provide - breakfast, lunch, etc.

It’s still a bargain to you.

I agree. You seem so resentful at having to contribute anything towards the cost so I'd find somewhere that will offer you the "free hours" only and pay for all your consumables

Why dont you ask your nursery for a breakdown if it's that important?

Fwiw I agree with everyone here in that nurseries should be well paid so was more than happy to pay for quality care. My nursery bill was £700/£800 a month which reduced to around £300 a month when my son turned 3.

Now he's at school, we do still pay for wraparound care/holiday care which is roughly £100-£200 a month (Depending on holidays).

It is what it is, you either work and pay for childcare or you don't work and don't need to pay for childcare.