Free childcare that's proving unaffordable

All three and four-year-olds in England are entitled to 570 hours of free early education or childcare a year, which is often taken as 15 hours each week for 38 weeks. Some two-year-olds with parents on benefits or low wages are also eligible. This scheme was introduced in the late 1990s and expanded in the mid 2000s to cover different age groups. But offering this free childcare is costing.

Debbi Gould runs First Steps Children’s Nursery in Compton Road, Wolverhampton, as well as three others in Birmingham.

She said the lack of funding available in Wolverhampton has left many nurseries fighting a battle to stay a float.

“There is a big shortfall,” she said. “In Wolverhampton we get £3.32 per hour, per child for every three year old. My hourly rate is £4.50, so we are already losing money. The actual cost of looking after a child is far higher than that, probably double.

"In Birmingham we are getting a much higher amount from the council.

“For private providers like us there’s a balance in terms of offering high quality provision and making enough money to run the business.

"A lot of settings are non-profit organisations that don’t even meet their costs. It is little wonder that some of them go out of business.”

First Steps in Wolverhampton is one of the few Ofsted ‘outstanding’ rated providers in the city, a fact that Mrs Gould says could account for the low number of parents taking up childcare options.

“Since we were rated as outstanding we have had no problem filling places. Parents look for quality and if they can’t get it they may decide to keep their youngsters at home.”

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