Almost one-eighth of maintained nursery schools are in deficit, reveals new research published by the Department for Education today.
The Providers’ finances: Evidence from the Survey of Childcare and Early Years Providers 2018 report found 12 per cent of maintained nursery schools were in deficit with 84 per cent breaking even and the remainder in surplus.
Heads of maintained nursery schools this month marched on Downing Street to warn ministers that without sustainable funding their schools will close, with 16 having done so since 2016.
Among nursery classes in primary schools there were 24 per cent in “deficit” where costs exceeded income, 27 per cent in surplus and only 48 per cent breaking even.
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The study, carried out by researchers at Frontier Economics and NatCen Social Research, showed that staff costs comprised 79 per cent of maintained nursery school costs and 87 per cent of nursery classes - ahead of nurseries in both the private (69 per cent) and voluntary (76 per cent) sector.
Some 3 per cent of staff in maintained nursery schools and 5 per cent in nursery classes were paid at or below the statutory minimum of the National Living Wage (£7.50 per hour until April 2018 and £7.83 per hour from April 2018), far fewer than for those employed by other types of provider.
Private and voluntary providers faced higher rent and mortgage costs than the maintained sector but spending on food, materials, training and “other” was similar across providers of all kinds.
The survey was unable to assess the use of additional charges in maintained nursery schools.
But additional charges were applied in nursery classes in state schools: 43 per cent of which charged for meals, 16 per cent for snacks, 56 per cent charged for one-off activities and 10 per cent charged for unarranged late pick-ups.
Neil Leitch, chief executive of the Early Years Alliance, said: “The government’s underfunding of the early years is pushing up fees and additional charges for parents and leaving providers with no choice but to limit places to those children with the fewest additional needs.
“This is an unsustainable approach to early education and it’s nothing short of appalling that ministers are asking parents to prop up their flagship childcare policy. It’s inevitable is that this is only going to get worse.”
The DfE has been contacted for comment.
