Nursery bill confusion- Help!

[LunarMoon92]

In need of some advice with regards to the 15 hours funded childcare.
Currently my daughter attends 3 full days a week at nursery. £55 a day 3 days x £55 = £165 × 4 weeks = Monthly payment of £660.

Contacted nursery to find out how the 15 hours would affect our monthly bill from January and was passed on to the owner and now I'm so so confused. I mean I worked in childcare calculating payments and I'm still just not understanding.

The owner stated the following -
In relation to fees, from January 2025, 11.4 hours of funding will be accessed each week (11.4 x 50 weeks =. 570 hours) this is currently the maximum funding available for your child’s age group. The 11.4 hours will be allocated evenly across the days attended, if you continue to access the 3 full days then 3.8 hours of funded hours will be allocated and 7.7 hours of wrap care will be charged for the hours not covered by funding. This will result in a daily charge of £41.94 including food, making a monthly saving of approximately £156.00. Regarding Working Parent Funding, we only offer this on a stretcher basis (all year) accessing the following sessions only - 7am - 1pm, 1pm - 6.30pm or 7am - 6.30pm (full day), if you wish to reduce your cost further then these are the sessions available to you.

And then when I politely emailed her back -

Thank you for your quick reply.
Could you break this down for us even further to explain where the funded hours will be used?
And how this will look if we -
Increase to 5 days a week
Decrease sessions to 2 days a week
Change sessions to 7am - 5pm.
Apologies for all the questions, just trying to wrap our heads around it all.

Were met with the following -
Firstly, we do not offer a 7am - 5pm session, charges will still be from 7am - 6.30pm. As mentioned, based on 3 full days attended (each day being 11.5 hours) 3.8 funded hours are allocated each day and the remaining 7. 7 hours not covered by funding (wrap) is charged at £5.20 per hour (7.7 x £5.20 = £40.04 per day plus £1.90 per day food = £41.94). If you increase to 4 days a week, 2.85 hours a day would be allocated to funding and 8.65 hours would be charged as wrap for hours not covered by funding. This would result in a daily charge of £43.25 plus £1.90 for food = £45.15.
If you were to drop to 2 days per week, 5.7 hours a day would be allocated to funding and 5.8 hours would be charged as wrap for hours not covered by funding. This would result in a daily charge of £31.90 plus 1.90 for food = £33.80.

I hope this makes sense, please be aware that the funding is not a monetary value deduction but an hourly value deduction. If you would like to discuss this further please do not hesitate to contact me.

Now my sister has a child similar in age paying £125 a week childcare for 2 full days and her fees have nearly halved.

Please can someone explain all this as if I were an alien?

I always find nursery invoices baffling.

Out of interest, I put your question into an AI system and this is what it said. I don't know if it's right but maybe read through and see if it helps?

I can help break this down for you! It seems like the nursery is explaining how the 15 hours of funded childcare work for your daughter, but it’s a bit tricky.

Here’s the key:

1. *Funded Hours (11.4 hours per week)*: The government provides funding for 15 hours of childcare, but they’re giving you 11.4 hours a week for your child’s age group. This is the "free" portion, but it doesn’t mean you don’t have to pay anything—just that a certain amount is covered.

1. *How the 11.4 hours are applied*:

- If your daughter continues attending 3 full days per week (11.5 hours per day), 3.8 hours of those 11.4 hours will be “free” each day. - The remaining 7.7 hours (i.e., the hours not covered by funding) will be charged at £5.20 per hour, which equals a daily charge of £40.04 for the wrap care, plus £1.90 for food, making the total daily cost £41.94.

1. *If you increase days*:

- If you increase to 4 days, you’d get 2.85 hours funded each day, and the rest (8.65 hours) would be charged as wrap care, which would cost £43.25 per day, plus £1.90 for food (£45.15 total).

1. *If you reduce to 2 days*:

- If you reduce to 2 days, 5.7 hours per day would be funded, and 5.8 hours would be wrap care, so your daily charge would be £31.90 for wrap care plus £1.90 for food, making a total of £33.80 per day.

1. *Key Points*:

- The funding isn’t a direct cash discount—it’s calculated in terms of hours. - The wrap care (additional hours not covered by the funding) is charged at £5.20 per hour. - The food charge is £1.90 per day. - The total cost depends on the number of days you attend and how the funding hours are spread across those days.

Your sister is paying less (£125 a week for 2 days), which could be because her nursery charges lower fees per day, or they might be applying the funding in a way that works out differently.

Does this breakdown make more sense now?

Actually for a nursery, that's pretty clearly written!

What bit are you struggling with?

I presume your sisters child doesn’t go to the same nursery?

They can all set different rules on how they accept funding. Ours also accept it year round, and don’t have term time only children, so we also get 11.4 hours a week, and then we pay a daily subsidy for using funded hours… and our day rate is higher than yours, so for two full days before the funding I pay £690, and now I pay £460.

That's a very clear reply. The nursery are able to set their own rules and they have been very open in explaining to you how the funding works and what the costs would be.

What your sisters nursery does is completely irrelevant.

Going to echo what others have said above, the nursery have actually explained it pretty well. Funded hours can only be used during term time, I'm assuming they've reduced the weekly funded hours from 15 to 11.4 because you want the funding applied all year round? You've got less funded hours each week and you're paying a consumables charge over the funded hours and then paying wrap around care around the funded hours because you need full days, that's why you're paying so much still. It's also not up to you how you use the funded hours so each nursery has their own rules on how they are spread and over what time in the day.

In a nutshell, funded hours are great if you just want the funded bit (so like 9-2 x 3 days a week for example) but as soon as you want full days (which most people need because of work) you have to pay wrap around to cover the full day and that ends up costing almost the same as a full unfunded day anyway. For example at my children's nursery, a full unfunded day is £65, a full day using funded hours from the 15 funded hours is £58 (£10 for consumables for the funded bit then £48 for am and pm wrap around). The nursery only allow one way of using the 15 hours and that's 3 days of 09.30-02.30. If I was allowed to split the hours over 2 days however I wanted so say 10 hours one day, 5 hours another day, because of my working days/hours I would literally have to pay no wrap around and it would be so much cheaper, so you can see how nurseries' rules on how they apply funded hours makes a big difference. This is also why I hate how when this was originally announced it was called 'free childcare' and it was to help people go back to work. Nobody is getting free childcare, unless you can find a nursery that doesn't charge a consumables charge and you have to pay expensive wrap around for a full day unless your working hours are like 10-2 or something, which is literally nobody.

The nursery's explanations in the OP make sense to me.

The 15hrs per week is term time only. Stretched across the whole year it's 11.4 hours per week. This is divided evenly across the number of days you use so each day you pay a standard rate for the unfunded hours plus a £1.90 charge for food. Each day is 7am - 6.30pm = 11.5hrs so if you are getting 3.8hrs per day free (attending 3 days a week) you have to pay for 7.7 hrs of childcare. If you use more days you'll have fewer free hours per day so the daily charge is more, and likewise if you use fewer days you'll have more free hours per day so the daily charge is less.

Months are slightly longer than 4 weeks, there must be some months you have to pay 5 weeks so your average monthly fee is actually currently £687.50ish

With the free hours and staying at 3 days a week it will be 7.7x £5.20 per day = £41.94 including the food charge. They are charging a higher hourly charge for wraparound care around the free hours (£5.20ph) than they do for children who are not getting free hours £4.78. That's fair enough - all businesses charge a better rate when you buy "in bulk"

Nurseries don't get enough from the government to actually fund the free hours. They have to use charges like this just to break even.

It’s shocking really! tbh once your child goes to school you think you’ll save a heap on fees but the govt takes it off you in other ways!

Thank you all for your responses. Most helpful 🥰

I presume your sisters nursery has a shorter day... 7-6.30 is a lot longer than I've come across, usually something like 8-6. So less unfunded hours to pay for.

The funding was originally intended for the 'education' part of the day with 3yo funding so many nurseries offer this for the 9-3 part of the day ie school hours while the hours outside this are wrap around. This works fine with preschoolers but the model works less well with babies attending because their parents need to work. The system definitely needs to be looked at again.