New research reveals financial impact of Covid on early childhood settings

Nurseries were losing more than a thousand pounds a week in school fees due to the pandemic last December, according to a study commissioned by the DfE.

At the same time, they had to find additional money to cover staff absences and pay for additional cleaning products and PPE.

The last Ministry of Education Survey of child care and early years service providers and coronavirus (SCEYP COVID) reveals that providers received less than expected in fees paid by parents, with group providers being the hardest hit.

During the period of the survey, November 27 to December 20, 2020 (described as Wave 3), responding Group Service Providers (GBPS) reported losing an average of £ 1,176 per week in fees. They were also the supplier who was most likely to report a reduction in the number of hours of operation.

On average, school providers lost £ 401 per week and childminders £ 230 per week in parenting costs.

A total of 2,964 providers (293 SBPS, 1,147 GBPS, 1,524 childminders) responded to the Wave 3 survey, conducted by NatCen Social Research and Frontier Economics. The statistics have been weighted to provide a representative overview of all suppliers in England.

This survey is the third in a series (Wave 3).

  • Wave 1 of this survey was carried out from July 2 to 20, 2020 and is available here .

  • Wave 2 of this survey was conducted from September 25 to October 18, 2020 and is available here.

Opening hours

The figures show that there was a slight decrease in the number of group providers open more than eight hours per day between waves 2 and 3. In wave 2, 42 percent were open more than eight hours per day compared to 37. percent. cent at wave 3.

The most common reason for the reduction in opening hours was the lack of parental demand.

Childminders (CMS) were more likely to have more parenting choice or flexibility in scheduling, with 31 percent doing so, while 13 percent of open SBPs and 18 percent of GBP decreased on choice and flexibility of hours.

Across all provider types, fewer children, including under and over two years of age, attended facilities than expected in Wave 3.

Despite this, vendors were slightly more confident about their financial viability for another year or more than they were during wave 2 of the pandemic (September 25 – October 18, 2020), with a total of 47%. of GBP and 56% of CMS feel “reasonably confident”.

Closures

Of all providers, childminders were more likely to report closing this wave temporarily or permanently compared to the previous one. One of the reasons given was the lack of parental demand.

Only 4% of British pounds said it was closed temporarily or permanently between November and December 2020. The most common reason was that it was no longer financially viable to open.

Recruitment

According to statistics, three-quarters of nurseries have increased their use of substitute staff or the hours of their existing employees to cover staff absences during wave 3 of the pandemic.

A total of 41% of open school providers increased the use of temporary or substitute staff between November 27 and December 20, 2020, while 35% of group providers (GBPS) increased staff hours permanent.

Open SBP and GBP reported their highest additional weekly cost for staff to cover absences, with average weekly costs of £ 311 and £ 104 respectively.

At the time of the investigation, over 30% of open GBP and 29% of SBPs had one to four staff members absent due to COVID-19.

A total of 13% of SBPSs had five or more staff members absent due to the virus, compared to 3% of open GBPSs.

Group providers were more likely to have used the coronavirus retention program in wave 3 with 74% of staff on leave, compared to 11% of school providers.

Housekeeping and other additional costs

School providers

  • £ 128 for cleaning supplies
  • £ 67 for heating
  • £ 48 for PPE
  • £ 104 for ‘other charges’

Group providers

  • £ 39 for cleaning supplies
  • £ 29 for PPE
  • £ 26 for heating
  • £ 60 for ‘other charges’

comments

Children and Families Minister Vicky Ford said: “The majority of parents who used formal child care before the pandemic are accessing it as we come out of lockdown, testifying to the hard work staff Childhood Care is designed to support and reassure families, while providing essential care and education to our youngest children.

“We are providing top-up funding for councils that have seen a growing demand for free child care rights during the spring term, cat 85% of their census level in January 2020. We will also temporarily adapt our method of financing local authorities and service providers over the next fiscal year by using their quarterly attendance count in the summer and fall quarters, in order to protect their financing revenues and to gain more reassurance.

Purnima Tanuku, Managing Director of the National Day Nurseries Association (NDNA), said: “It is important that DfE collects this data from providers so that they understand the challenges facing the sector on the front line. This research confirms what we have been saying since the start of the pandemic.

‘Supplier’ revenues are only two-thirds of what they would normally expect as they report additional costs, this was at a time before the worst of the pandemic hit in late December and January. More than half of the nurseries did not have confidence in their financial sustainability and this is worrying for the future of the sector.

“The DfE now has its own research that supports our calls for additional financial support for childcare providers to help them weather the storm. “

Neil Leitch, commenting, Neil Leitch, CEO of the Early Years Alliance, said: “This survey is just the latest in a long list of documents documenting the totally unsustainable pressures the early years sector is currently facing. . It is incredibly frustrating to see even more evidence of the pandemic’s significant financial impact on the sector, at a time when the government is still unwilling to provide the support providers need to remain viable in the long term.

“Even with the return of schools and workplaces, lingering concerns about the risks of Covid-19, alongside the extension of the leave scheme, will continue to impact the demand for early childhood places. Combined with an increase in unemployment expected to follow the end of the leave scheme, it is clear that the challenges facing early childhood providers are expected to continue for some time – and that without urgent government support, we will witness. probably when closing more and more settings. ‘

  • Survey results are available here

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