will push the nursery sector into a deficit running into hundreds of
millions of pounds without serious commitment from the Government to
reforming the system of childcare funding.
A funding gap of £404.57m in 2016/17 is forecast for implementing the NLW for staff aged 25 and over. This would increase to £446.12m should all employees receive a 3 per cent pay rise.
These losses are set to top more than £700m from 2020, or £800m-plus if all settings are graduate-led.
The sector, which is already beset by an underfunding crisis for the free places for two-, three- and four-year-olds, will be hit by the NLW, increases to the minimum wage, the new apprentice levy, and planned rises in employer pensions contributions.
The warning comes from the Pre-School Learning Alliance, which commissioned an analysis by research agency Ceeda on the future impact of policy changes such as the NLW on private, voluntary and independent (PVI) nurseries and pre-schools.
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