{"id":68458,"date":"2025-05-02T13:12:09","date_gmt":"2025-05-02T13:12:09","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/68458\/"},"modified":"2025-05-02T13:12:09","modified_gmt":"2025-05-02T13:12:09","slug":"london-childcare-prices-fall-but-nurseries-warn-of-crisis-looming","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/68458\/","title":{"rendered":"London childcare prices fall but nurseries warn of crisis looming"},"content":{"rendered":"

London childcare prices have dropped for the first time in 15 years but providers warned the reductions will not last.<\/strong><\/p>\n

The falling costs coincide with the government funding scheme launching in September which offers 30 hours of free weekly childcare to eligible working parents of preschool children in England. leading to a 22% reduction in childcare costs for them.<\/p>\n

Previous funding was limited to three and four-year-olds, yet the sector faces significant challenges due to the stark disparity between government funding and escalating operational and staffing costs which providers say may leave them being forced to exit the scheme.<\/p>\n

Early Years Alliance (EYA) CEO Neil Leitch said: \u201cI will pay more to park my car locally for a day than I will get from the government to care for a two-year-old or a three-year-old.\u201d<\/p>\n

The current situation<\/strong><\/p>\n

According to Coram Family and Childcare\u2019s 24th annual survey, London* remains England\u2019s most expensive region for childcare<\/a>.<\/p>\n

However, Wales now faces the highest rates nationwide, with parents paying \u00a3155.04 pwe week for children under two, amounting to \u00a315,038 annually for full-time nursery care.<\/p>\n

In England, the prices of 25 hours at nursery for children aged under two were down by 55.8%, while Wales prices were up by 10.8%.<\/p>\n<\/p>\n

Despite the overall costs falling in London, the average cost for three-and-four-year-olds specifically has risen across England, Wales, and Scotland.<\/p>\n

The East Midlands remains the cheapest region in England for childcare, while London continues to be the most expensive for three-and four-year-olds.<\/p>\n

Providers put the reason for higher prices is clear down to staffing.<\/p>\n

Childcare in the UK is expensive partly due to the required ratio of one adult to a maximum of three under-twos, which providers say is increasingly difficult to maintain amid staffing shortages.<\/p>\n<\/p>\n

Leitch said: \u201cWhen people discuss why they joined the industry, they say \u2018I love children, I want to change their lives, I want to support them\u2019.<\/p>\n

\u201cBut you can only do that for so long when you can\u2019t put a meal on the table for your own children.\u201d<\/p>\n

Nurseries face rising costs, with 96% planning to raise fees due to the government\u2019s increase in employer National Insurance contributions.<\/p>\n

Coram Family and Childcare\u2019s head Lydia Hodges predicts families will see another price drop when the 30-hour government funding begins in September.<\/p>\n

However, she warned costs may later increase if funding fails to keep pace with nursery expenses.<\/p>\n

Hodges said: \u201cIn the past, nurseries could set their own charges and rates more freely because parents were the ones paying.<\/p>\n

\u201cNow the government is the biggest purchaser of childcare, they have less choice in the income they get.\u201d<\/p>\n

\"PicturePregnant Then Screwed Founder Joeli Brearley. Photo provided by Pregnant Then Screwed<\/strong><\/p>\n

Pregnant Then Screwed founder Joeli Brearley said while the drop in childcare costs is a significant milestone, it brings challenges.<\/p>\n

She warned: \u201cA looming crisis in availability threatens to leave families stranded.<\/p>\n

\u201cLower fees are a step forward, but without further investment, accessibility and quality remain at risk.\u201d<\/p>\n

A looming crisis<\/strong><\/p>\n

Staffing remains a critical issue for the sector, with early years practitioners earning around \u00a313 per hour, while emergency cover costs nearly double at \u00a325 per hour.<\/p>\n

The industry has seen a surge in staff departures as 82% of early years settings reported<\/a> higher turnover in the past two years due to workers feeling underpaid and undervalued<\/a>.<\/p>\n

\"AA nursery child painting. Picture provided by Alba Nurseries<\/strong><\/p>\n

Anya Navidski, director of Alba nurseries in London, Marlow, Slough, and Maidenhead, advocates for increased funding and higher pay for nursery workers.<\/p>\n

Navdiski said: \u201cMy highest-paid manager earns around \u00a328,000 [compared to London\u2019s newly qualified teachers who typically earn \u00a338,000].<\/p>\n

\u201cWe\u2019re paying these people less than we pay cleaners.\u201d<\/p>\n

At Alba nurseries, cleaners earn the market average of \u00a318 per hour.<\/p>\n

Leitch said: \u201cPeople have just used up their goodwill.<\/p>\n

\u201cWhy would you not work in a supermarket and know that you start at nine o\u2019clock in the morning and you\u2019ll go home at five o\u2019clock, for more money?\u201d<\/p>\n

He described being an early years worker as financially disastrous and dreadful.<\/p>\n

\"AA child playing. Picture provided by Alba nurseries<\/strong><\/p>\n

The situation appears particularly concerning for children with special educational needs and disabilities (SEND), with many linking issues to the sector\u2019s staffing challenges.<\/p>\n

Only 29% of local authorities in England report adequate childcare provision for SEND children. <\/p>\n

The situation is particularly dire in inner London, where just 9% of councils can guarantee sufficient places.<\/p>\n

Leitch pointed out early years providers received significantly less SEND funding than primary schools over the past decade.<\/p>\n

He said: \u201cNobody seems to recognise that prevention is considerably better than cure.\u201d<\/p>\n

Navidski criticised local authority surveys for focusing only on current operating costs while ignoring the market rates needed to attract skilled staff capable of supporting SEND children.<\/p>\n

She said: \u201cI\u2019s really difficult to deliver on the standard that Ofsted\u00a0expects from you.<\/p>\n

\u201cOur children deserve a lot better than that.\u201d<\/p>\n

She also questions the uniform funding approach for all nurseries.<\/p>\n

Navidski said: \u201cI have a setting where all of our staff are level three to level six qualified.<\/p>\n

\u201cMost of them are fully qualified teachers, and yet we get the same funding rate for that setting as a setting half a mile down the road where half of the staff are unqualified and the rest are level two or three qualified.\u201d<\/p>\n

To address these issues, Hodges advocates for a comprehensive workplace strategy and suggests rebranding nursery teachers as early years professionals to better reflect their educational importance.<\/p>\n

Since COVID, nursery teachers reported increased expectations from potty training to teaching table manners and utensil use, but claimed government support fell short of enabling them to meet these demands.<\/p>\n

Hodges said: \u201cWe need to look at everything from pay and conditions to what training people get, how well supported they are in their roles, and what their progression opportunities are \u2013 all of the things you want for any sector.\u201d<\/p>\n

Future implications<\/strong><\/p>\n

Beyond staffing challenges, nurseries face severe financial pressures, with 92% reporting current rates don\u2019t cover their costs. <\/p>\n

National Day Nurseries Association (NDNA) policy and communications director Jonathan Broadbery indicated providers may need to increase fees by 10% to remain viable.<\/p>\n

Some nurseries, including the Alba\u2019s, have already faced 20% rent increases from landlords.<\/p>\n

Navidski said: \u201cIf the government is not meeting that cost through funded hours, nurseries have to do it privately.\u201d<\/p>\n<\/p>\n

NDNA\u2019s recent Budget Impact<\/a> survey of 728 nurseries revealed 96% plan to increase parents\u2019 fees. Additionally, 69% will reduce spending on resources, 48% will cut premises expenditure, and 39% will offer fewer places.<\/p>\n

In February, the Department for Education (DfE) informed nurseries parents eligible for funded hours should be able to opt out of paying traditional top-up fees for nappies and meals to prevent families from being priced out.<\/p>\n

While nurseries understand families\u2019 struggles with the cost-of-living crisis, they face identical challenges and cautioned that inadequate government funding will lead to increased costs to parents.<\/p>\n

Leitch proposed transferring childcare funding away from the Treasury to provide fair financial support for the sector.<\/p>\n

He said: \u201cThen providers wouldn\u2019t be arguing, couldn\u2019t argue, and the government certainly couldn\u2019t shortchange either.\u201d<\/p>\n

Secretary of State for Education, Bridget Phillipson said: \u201cDelivering a better early years system is a top priority.<\/p>\n

\u201cIt\u2019s as close to a silver bullet as we have in breaking down barriers to opportunity and giving young people the best start in life.<\/p>\n

\u201cThis survey highlights the real difference the expanded childcare entitlements are making, with much more to come from September as government funding increases from 15 to 30 hours a week of funded childcare.<\/p>\n

\u201cThrough our Plan for Change, we\u2019re delivering much-needed improvements for parents, making childcare more affordable, expanding school-based nurseries, and improving early language and maths support.<\/p>\n

\u201cWith over half a million children already in a place this term, we\u2019ll keep working with the sector to ensure even more families benefit.\u201d<\/p>\n

*Inner London boroughs are Camden, City of London, Greenwich, Hackney, Hammersmith and Fulham, Islington, Kensington and Chelsea, Lambeth, Lewisham, Southwark, Tower Hamlets, Wandsworth and Westminster.\u00a0<\/p>\n

Outer London are Barking and Dagenham, Barnet, Bexley, Brent, Bromley, Croydon, Ealing, Enfield, Haringey, Harrow, Havering, Hillingdon, Hounslow, Kingston, Merton, Newham, Redbridge, Richmond, Sutton and Waltham Forest.<\/p>\n

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