Purnima Tanuku: There's still hope for the sector if the Chancellor takes urgent action

It was the Chancellor Jeremy Hunt who in March first announced the Government’s intention to expand the existing childcare offer. The plans are due to be phased in, just a year later, from April 2024, meaning this is the last chance to put policies in place that will make a big difference to children and providers.

This offer announcement was made with great fanfare but no warning – and certainly not as a result of any discussion with the sector.

It's now up to the Chancellor to continue what he started and reveal a package of measures to support the sector to in turn deliver on his promises.

However, the sector appears to be shrinking rather than growing. A number of reports including the Early Education and Childcare Coalition’s workforce report out earlier this month are extremely alarming. It’s obvious that there will be more demand for nursery places from April next year – and yet a staggering 57 per cent of nursery staff are considering leaving their jobs.

Last week's Ofsted statistics show a 1 per cent drop in places which equates to 17,800 children. That’s a huge number of places lost. We also discovered that there were 502 fewer nurseries (providers on non-domestic premises) on the early years register in September compared with the previous year and a childminder exodus. There are now more than 2,500 fewer childminders in England, that’s a 5 per cent drop in just 12 months.  

So our question for the Chancellor is: who is going to deliver these funded places and where? Both the settings and the staff numbers are vanishing.

We need to turn the tanker around and this is what he needs to do urgently:

Firstly, our old favourite, boost the funding rates. Not just for two-year-olds, but for three and four-year-olds. There are currently ten times more pre-school children in funded places than two-year-olds so this is where the nurseries are most financially vulnerable. Our recent analysis of the September rates revealed providers are receiving an average of 32p extra per child per hour. You can’t even buy a pint of milk or a healthy snack with that.

It's vital that these funding rates will include the expected increase in National Living Wage and National Minimum Wage rates. We know the over 23s rate is going to be at least £11. This is good news for those in low pay sectors but this has to be taken into consideration.

Secondly, according to our own research, 67 per cent of nurseries would need to physically expand their settings in order to take on more funded places. The £100m of capital funding announced recently – which also includes projects for wraparound care – will not go very far to support building works across the country.

Thirdly, a personal crusade for NDNA over the years has been abolishing business rates for nursery businesses. We made it happen in Wales and Scotland but since the pandemic, it’s clear that nurseries are not considered eligible like the hospitality or retail sectors. But it’s now or never. Scrapping these unfair taxes on places where children grow, learn and flourish could release around £20,000 on average per PVI nursery. Don’t give with one hand and take away with the other.

And finally – probably the most important ask – we need an effective early years workforce strategy in place to try to plug the hole through which so many practitioners are slipping, and attract new talent into the sector too. These are the people who will be at the heart of the Chancellor’s expansion policy. These are the motivated, dedicated, amazing people who really matter and can shape our children in their first five years. They need supporting, training, nurturing and respected.

If the Chancellor can fulfil these four wishes, there is still hope. It’s in his hands now.