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The Government has revealed that around 10,000 fewer early years providers plan to deliver the 30-hour childcare offer for three- and four-year-olds, than the number delivering the current 15-hour free entitlement.
The Department for Education’s (DfE) survey, 'Childcare and Early Years Providers in England 2016', found that 44,250 childcare providers are planning to offer the 30 'free' childcare hours compared with 54,900 delivering the current entitlement.
Of the 22,700 nurseries and pre-schools currently offering the 'free' 15 hours, only 14,600 say they will offer the new 30 hour offer which will be available to working parents.
Neil Leitch, chief executive of the Pre-School Learning Alliance claims these figures may be the tip of the iceberg, saying: "What’s most alarming is that these figures were gathered at a time when many providers thought they would be receiving close to the average funding rate of £4.88 per hour.
Number of settings expected to be higher
"With final rates currently being confirmed across the country, and many providers discovering that they’ll be receiving significantly less, we would expect the number of settings opting out of the 30-hour offer to be even higher than these statistics suggest.
"Even more concerning is the fact that Government has confirmed these funding rates will be frozen until 2020, despite significant likely increases in childcare business costs such as wages, rents/mortgages and business rates."
The research was based upon 10,000 interviews with group-based nursery providers, school-based providers and childminders.
However, interviews were conducted between March and July 2016 before the new funding rates were announced and the 30-hour pilots started. Since this survey was conducted, the Government has also introduced a minimum rate for councils of £4.30 per hour.
According to the survey, 3,900 primary schools with nurseries plan to offer the 30-hours, compared to 8,200 who currently offer the 15-hours, along with 350 maintained nursery schools, compared to 400.
Providers worry funding rates will not cover costs
The most common reasons providers gave for not delivering the 30-hours included - the funding rate not covering costs, a lack of space or staff capacity and not being open long enough.
A "worrying decline" in workforce qualification levels has also been reported in the survey and gives yet more evidence of the barrier that GCSE maths and English rules present to progression in the sector.
The survey reports 79 per cent of staff at Level 3 or above and ten per cent at Level 6, compared to 87 per cent and 13 per cent respectively in the nearest equivalent category of full day care in the 2014 DfE survey. Meanwhile 48 per cent of Level 2 staff in group settings do not have maths and English GCSE at grade C or above.
Stella Ziolkowski, director of quality and workforce development at National Day Nurseries Association (NDNA), said: "The percentages of staff in group-based provision with Level 3 or Level 6 qualifications have declined, reversing the upward trend seen over several years.
"NDNA is calling on the Government to act urgently to broaden qualification requirements for Level 3 Early Years Educators to include functional equivalents to GCSE maths and English and to deliver its long-awaited Workforce Strategy. The right workforce is critical to high-quality early education and childcare and these signs of decline in qualifications must be addressed."
DfE welcomes news that majority of providers plan to offer 30 hours
A spokesperson for the Department for Education said: "It’s great to see that the majority of providers intend to offer 30-hours childcare, backed up by our record investment of £6bn per year in childcare by 2020.
"Since this survey was conducted, we have published our Early Years National Funding Formula, which will see increased hourly funding rates for the vast majority of providers and our Early Implementers are now successfully delivering the offer a year early.
"Alongside our record investment, we are creating a workforce strategy to help attract, retain and develop the very best staff so that we deliver childcare that is both affordable and high-quality to families across the country."
New online funding system
• A new online system called Funding Loop, which has been designed to make the Government funding process easier, is currently offering nurseries and pre-schools a free trial.
The software uses inbuilt knowledge, automatic calculations and easy document and signature uploads by automatically linking to the local authority’s funding platform.
Designed by nursery owner Khayam Ezzat, the software has been honed over two funding terms in his own nursery to automate the process as far as possible and ensure it is intuitive for parents and nursery staff.
To find out more about Funding Loop, go to www.daynurseries.co.uk/news/article.cfm/id/1582214/New-Online-System