Free childcare scheme: Parents and providers raise concerns ahead of rollout

Credit: PA

The government's new free childcare scheme comes into force from Monday April 1, as eligible families of children from nine months will be able to claim 15 hours of free childcare.

But a number of childcare providers say they don't have the spaces or staff to deliver the funded hours, and parents have raised concerns the scheme won't save them as much money as the government promised.

Education Secretary Gillian Keegan said this week she's "confident" the government will deliver the expansion of free childcare.

"We're working to make sure you have a funded place wherever you are in the country," she said.

So how does the new scheme work, and how much will families really benefit?

What is the new free childcare policy?

Eligible families of children as young as nine months old in England will be able to claim 30 hours of free childcare a week by September 2025 under the offer.

Chancellor Jeremy Hunt first announced the free childcare scheme in his 2023 spring Budget.

The scheme is due to be rolled out in three parts, with the first phase beginning on Monday, April 1, as 15 hours of free childcare is offered to working parents of two year olds.

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From September 2024 this will extend to children from nine months old, and from September 2025 the funded hours will double to 30 hours a week for eligible parents.

Previously, only working parents with children aged three and four were eligible for 30 free hours of childcare.

If one parent earns above £100,000 the free hours decrease to 15 hours a week.

Mr Hunt has promised the funding for childcare providers to deliver the scheme will increase in line with inflation and staffing costs from next year.

Why are childcare providers concerned?

Many nurseries say they have no space to offer the new free childcare policy, with more parents coming forward to book places for their children as a result of the new scheme.

A survey by industry body the Early Years' Alliance found 68% of all providers they surveyed said they are currently full, raising concerns they won't be able to meet the demand for new places.

Parent Lacey Freeman from West Norfolk says she's struggling to find a place for daughter despite being on a waiting list for more than a year.

She said: "My daughter is two and has been on a waiting list for a local nursery since she was nine months old but there are still no places until September."

A fifth of providers say it's likely they will opt out of the scheme entirely because of pressures around capacity and funding challenges.

Childcare providers are worried about rising wages for staff and the increasing cost of bills meaning they might even have to increase fees despite the new government scheme.

85% of providers say they plan to increase fees, and 86% said the upcoming increase in the national living wage for staff will have a negative impact on their finances.

June O'Sullivan, the CEO of childcare provider the London Early Years Foundation, says her nurseries won't be able to offer many extra places, and they've had to increase prices.

She added her organisation is "squeezed" because of historic "underfunding", and is therefore having to pass on extra costs to parents.

"We have to look to parents to make up the shortfall," she said.

"Parents are getting a very confused message," she added and "all I'm picking up is anxiety."

Ms O'Sullivan told ITV News there's a severe issue with staff shortages in the sector but despite this, the education secretary insisted "last year alone there was an additional 13,000 people who joined the workforce".

Will parents really save money?

Like the London Early Years Foundation, many providers are having to hike prices specifically to pay for the funded places, because of increases in overheads and wage costs.

Research from charity Pregnant Then Screwed revealed parents eligible for the new funded hours will still struggle to afford their childcare bill.

In a survey of parents, they found 62% of parents say childcare costs have increased in the last six months, while a quarter say the new funding will save them less than £90 a month.

They also found 22% of parents eligible for the new funding are still considering leaving their job or reducing their hours at work due to childcare costs.

Would Labour keep the scheme if they win the election?

Labour caused a stir on Tuesday when they refused to commit to keeping the scheme in place if they win the election.

Asked by BBC Newsnight whether Labour is planning to go back to the drawing board on the childcare expansion plan if they win the general election, Shadow Education Secretary Bridget Phillipson said the system “does require reform”.

In response, Education Secretary Gillian Keegan accused Labour of being the "biggest threat" to the plan, and said they want to "cancel" the rollout.

Childcare provider CEO Ms O'Sullivan said Labour "must be careful of the way they message things, because parents are already stressed."

"It's too late, you can't disappoint them, parents are expecting something", she said.

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