The move will potentially affect thousands of parents as combined the two groups run more than 385 nurseries in England, providing places for nearly 40,000 children.
In common with many other providers, Busy Bees Childcare, the largest nursery group in the UK, and The Co-operative Childcare, which was ranked sixth largest in November 2016, say that they are having to restrict the times and days parents can take the 30 hours and charging for extras such as meals to deliver the scheme, because of low funding rates in some local authority areas.
It follows comments from the children and families minister Robert Goodwill that Busy Bees and The Co-operative Childcare are keen to deliver the places at the funding given.
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