The grant, currently worth a minimum of 1,248 a year or 416 a term, gives the parents of three- and four-year-olds up to five free two-and-a-half-hour sessions for 33 weeks of a year. But the National Day Nurseries Association has noted growing problems with the scheme as day nurseries are losing money because of it.
NDNA chief executive Rosemary Murphy said, 'All nurseries and playgroups have to ensure that children have two-and-a-half hours a day of free nursery education. Then, if there is any extra money left in the pot, it goes on improving provision, such as staff training or new toys.
'All parents need to know is that they are entitled to five two-and-a-half-hour sessions of free nursery education a week for 33 weeks of the year. But confusion is being caused by local authorities insisting on telling parents how much that grant is worth - even though the grant is for the nursery and not the parents. As a result, parents are unintentionally being encouraged to insist that the nursery reduces their fees by the full amount of the nursery grant rather than by their time entitlement.
'We've been receiving reports from all over England about this. This is not a new problem.'
A Department for Education and Skills spokesman said, 'The nursery grant is worth a minimum of 1,248 a year and is no longer a direct grant.
From April 2003 it has gone direct to the local authority. Local authorities then set their own grant according to the average costs of childcare in their area.
'The funding is for the provider regardless of cost, so if the cost is lower than the grant then the difference is to be used by the nursery to improve its overall quality. Parents should not ask for the difference back.'
Paragraph 117 of the code of practice issued by the DfES in April states, 'Parents should not be required to pay any fee for their child's free nursery education place, nor can they be expected to take up or pay for any additional services as a condition of a child attending a free nursery education place. If a child attends a provider that would normally charge fees, the fees charged should be abated or refunded as appropriate.'
But Arelene Caddow, co-owner and manager of the West View Day Nursery in Bradford on Avon, Wiltshire, and the Old School day nursery in Ascot, Berkshire, has had problems with the grant in both counties. She said, 'Our rate here is 3.40 an hour for a minimum of four hours from 9am to 1pm and 4.50 in Berkshire. The grant is equivalent to 7.56 per session. Under the scheme we are asked to run each free two-and-a-half- hour session for 7.56, so we are losing money on each child.
'We charge on an hourly basis, not a sessional one. I can't see how we can continue to operate within the nursery grant system at a rate of 7.56 per session when our rate is 3.40 an hour. The Government wants to raise childcare standards, yet it deems 3 an hour to be an adequate fee for childcare. You can't pay staff salaries on that. The problem is that things are open to interpretation.'
Emily Witcher, nursery education grant officer for Wiltshire's Early Years and Childcare Team, has advised parents that paragraph 117 'clearly implies that the setting in question should be refunding you the fees that they would normally charge - not the grant value'.
