Business Challenges in Childcare Today

30 hours of funded childcare per week (school term time, or fewer hours over more weeks) . What a great opportunity for cash strapped families to reduce the cost of their childcare – whether they are going out to work, or training, or even spending some time for themselves. I can see why this was a vote catcher, with the Labour party offering 25 hours, the LibDems 27, or was it 28, and then the Conservative topping the poll with 30 hours, and winning the election. No wonder the Government do not want to U turn on this election promise!

Strangely children born in November receive 5 terms of this, but children born in July only receive 3 terms – even though they need most help to catch up with children born earlier, strange?

Unfortunately for the nursery providers, not only is the funding paid by the government and funnelled and top sliced by the local authorities inadequate to pay for this, as it hasn’t kept pace for the last 10 years, but we are also told it won’t go up in the next 3 years either! On this basis the government is paying ￡4.30, docked by the local authorities to around ￡4 per hour per child, fixed for 3 years. Compare this to ￡10ph for walking one dog, ￡10ph for baby sitting in the evening in a child’s own home (no rent, but could be more than one child). This rate is insulting, and interestingly in Westminster the government are apparently paying ￡8.30 ph for their own children – how did they do that I wonder?

This funding can save ￡150 per week (on average) per 3-4 year old, 15 hours of which is subject to means testing, which is a massive financial improvement, and a great step forward. The exact amount paid for this to the nursery provider varies from local authority to local authority based on how many children their allocated funding has to be shared around, it has nothing to do with costs in the area, such as London waiting, strangely. There is a complicated code that parents have to try and get from a government website (that works periodically) in order to process the claim… The formulae for local authorities is very complicated, in areas of deprivation where children should be funded more (apparently they are more expensive to look after?) so the basic funding is top sliced more to enable this to occur.  No allowance seems to be made for the cost of premises or any other local effect – surely monopoly price fixing, and one that is being challenged in the courts currently.

The childcare sector has long been a soft touch for politicians and the DfE, non unionised, no powerful allies in business, we are very gentle, caring people that are being taken advantage of!

The schools are so much better at this – as evidence I rest my case on the incredibly long holidays that schools achieve without any children on site, with 6-8 weeks in the summer, 3 weeks of half terms, 5 weeks of Christmas and Easter, plus “teacher training days” and also very short days, often 9-3 when they have children in.  Contrast this with typically 8am-6pm opening, but some open 6AM – 8PM days for day nurseries, 50 - 52 weeks of the year, often including bank holidays. Some are even open overnight (serving night workers such as airports). Day nurseries serve parents working in hospitals, at police and fire stations, in retail shops, and offices – where parents do not work from 9-3 – how is that schools do not serve the very same parents? Schools shut for the long summer harvest so children and teachers can go and help in the fields, sorry which century was that?

You see early years educators have historically responded to parents needs and are open when needed, rather than to suit the teachers. The excuse that children are tired after 6 hours in school doesn’t hold any water, as the environment and activities are adapted for the child, not the other way around in proper childcare. So children can nap, and spend time outside and be physically active or not, as they need to, to avoid the stir crazyiness. exhaustion, hunger and thirst often seen at the end of a school day. Education, and actually life, does not have to be like that – and is not like that in day nurseries nor in forward thinking schools, nor in forward thinking work places comes to that.

Minimum Wage and Living Wage have gone up significantly in recent years, and continue to increase so unqualified people working in the sector are earning more. This is a good thing, and the qualified people should be earning significantly more again and the degree qualified people should at least be earning the same as they earn in schools. Unfortunately they aren’t, because the government and our culture have always underpaid those working with small children. 25 years ago we were considered at the same or less value as cleaners and those on tills in shops or behind bars or serving in restaurents.  This hasn’t changed at all, so the protection of the NMW and LV has at least provided pay increases for all.  Yet our children are the future, they will pay for us in our dotage. They are the most precious things in most parents lives, our children’s happiness is the thing we work and strive for – isn’t it? So why don’t we or won’t we pay properly for it? Are children’s lives really so valueless still? Maybe this attitude can be excused because looking after children is such a lovely job – rewarding emotionally, exciting even, despite the nappy changing, vomit clearing, bloody knee cleaning but think for a moment of the huge stress if a child wonders out of sight or get into mischief – and staff who risk prison and/or significant fines should attention wonder and disaster occur, for example if you dare go to the toilet or answer a phonecall while in charge. Not to mention the self chastising and guilt should a child be injured, and the condemnation by parents and society – this job is a huge risk job. Yet we pay childcarers less in a WEEK than a lawyer or accountant or consultant earn in ONE hour. Where has society gone wrong? And paying for childcare is not just for the parents of that child, the parents are helping provide for the country’s future. If you have no children then other people’s children will have to be paid to look after you when you are old, and to pay for your state pensions, and staff the hospitals, public transport and shops when you retire – we need children in this country, and they are already a huge expense and responsibility without clobbering parents for childcare.

Then we have Business Rates, schools pay them but get them back as the local authorities get them back from the government.  Childcare providers in churches doesn’t pay them at all. Some day nurseries in local authority owned buidings don’t pay business rates and some do.  The government have offered local authorities to pay at least 50% back, but no local authority appears to have taken up the offer despite day nurseries asking them to.  What happened to any kind of level playing field? – and how can the government claim it has worked out how to pay for 30 hours funding effectively when this calculation is currently impossible to work out?  Business rates have just gone up significantly, and are expected to rise further in the next few years. How are nurseries, apparently on fixed funding now, going to absorb these increases? There is only one way, to charge more per hour than the government are paying. Whether nurseries call that additional optional charges or some other name to avoid calling them a mandatory top up is a mute point, the fact is that nurseries either must charge extra or engage in charitable fund raising or close down. Day nurseries can’t use a smaller building – because the legislation says they must have 3.5 sq metres for under 2 year olds, 2.5 sq m for a 2 year old and 2.3 m for a 3-4 year old (schools have no such requirements), so comic strips depicting nurseries having to run in a telephone box because of business rates unfortunately misunderstand the problem. But would we want our childcare to run from tiny buildings, squash them in like flies? I sincerely hope not but right now nothing would surprise me – I wonder if the government will now relax all size requirements on day nurseries so we can be forced to cost cut in this way? It is their choice/voters choice after all whether we value our children having indoor space, or not – isn’t it?

Nurseries can’t reduce overheads much, they can’t be more efficient by using less staff as that is a matter of legislation – they must have 1 member of staff for 3 under 2s, for 4 2 year olds and for 8 3-4 year olds unless they have a qualified teacher who can take 13 3-4 year olds (but the teacher costs more).  Cutting staff numbers is something we could consider otherwise, despite the widespread outrage from the sector and parents a few years ago when it was suggested by the government. If a qualified teacher per nursery was mandatory, I can see an argument for relaxing the numbers of children per graduate or level 3 – but even those countries requiring 1:5 like New Zealand also have a culture of allowing non qualified staff to work alongside the qualified staff to provide the arms to cuddle and change and feed babies, and to potty train and toilet toddlers, and to help pre-schoolers get their coats and boots on and off, and help them hold their pencils correctly and avoid spreading paint, sand and water around the entire building – because no matter how many degrees you have you physically cannot change more than one baby at a time, so who is going to look after the rest of them while you do – or are you going to strap them up/actually restrain them, like the French do or discipline them into submission like the Orientals do? We are British – our children need to be free to move – please!

 We could cut electricity and gas bills yes – but we are still obliged to keep the temperature of the room at a H&S acceptable temperature, and its quite nice to have the lights on especially in winter. These bills are increasing significantly this year. We could also cut our purchasing of new toys and just use recycled materials, this would be good, but good quality books, tools, puzzles, and computers are pretty much essential for good quality childcare in my opinion.  These are marginal parts of the total cost of childcare anyway, as staffing and the rent/rates are generally 80%. Also nurseries are VAT exempt, so can’t claim any VAT back, unlike schools which are zero rated, so they can. Yet schools than offer early years classes are funded significantly MORE than day nurseries, yet another grossly unfair policy imposed by the government on day nurseries – why – is this accidental?

Ofsted reports were reported as being much better in school early years classes than in day nurseries but schools were given notice of inspections, and day nurseries weren’t until only a few months ago, sand with inspections only every 3 years or so, this will take longer to be reflected in the results. I challenge that school pre-schools are the stars of the sector. 

On schools much is made of classes being degree led, and they are which is great, but there are now many day nurseries with managers or pre-school leaders with degrees, and those without can often lean on an area manager or directors to provide the curriculum advice that these professionals undoubtedly contribute.  I have a masters degree in Education myself, I run a chain of 17 day nurseries. Each nursery has an average of 60 children, so 2 classes, so I suppose I am not too dissimilar to a large comprehensive Head in responsibility. I also have an operations director who an Early Years Degree and post graduate Professional status, and she is supported by 3 area managers, 2 of which also have the EYP status. Most of the nurseries are led by a manager who has a degree, but not all. This is something we would like to work on, but there is currently no funding whatever to help senior nursery staff to achieve degrees, and very few courses available either. If the government could help with this, I think there would be significant benefits to the individual and to the children and staff they are responsible for. However, like most degrees, its not just the degree that is important, it is where it was achieved (Oxford or Open University or Portsmouth, just for example)  and whether the person applies their knowledge and has relevant experience or not – this makes a huge difference and it is not uncommon to have an apprentice of 6 months experience in a day nursery to actually outperform a post graduate due to lack of experience and common sense and natural empathy in the graduate.  Just having an Early Years Professional Status or Teaching Status does not guarantee an outstanding leader, I have seen this first hand and the manager had to dismiss an EYP in our Winchester nursery for being totally ineffectual - just couldn’t manage to ensure the 30 children in the pre-school were engaged in useful activities rather than milling around destroying stuff – which is a HUGE skill actually,, requiring observation, relating to theory, analysis, setting up activities appropriately, delegation of staff, role modelling, supervision, inspiration, creativity, organisation, and ideally a little Pied Piper of Hamlet charisma, just to name a few aspects.

The government have blocked early years practitioners from completing a level 3 qualification in early years unless they have GCSE C Grades, effectively stopping the sector from recruitment and continuous professional development and colleagues are stopped at a level 2, and sometimes stopped from entering the career at all by the thought of having to do GCSEs in order to progress. Teenagers with good GCSEs from school  can go straight into A levels and on to University where academic achievements are king, they don’t have to be organised or charismatic and can even be on the autistic spectrum, bigoted or immature. Not so in Early Years, where communication, positive attitude, caring about people, common sense and anti-discrimination are far more important than academic achievement.   Early Years is the ONLY apprenticeship, including engineering, where GCSE C grades are mandatory and no equivalents of any nature are accepted. And the only reason why the Early Years Trailblazers were unable to progress the new National Standards for Early Years, for which we were dismissed this month – was because we didn’t agree with the Government, we maintain that there are many equivalent and practical ways of improving the standards of literacy and maths for colleagues and for the children in their care without blocking recruitment into the sector.

GCSE C grades have no evidential proof of providing a better early years professional than any other type of maths or literacy qualification. There is no doubt that Early Years colleagues need to be able to communicate both verbally and lately to use a tablet to record child development and communicate with parents (some day nurseries still use written evidence) and a lack of fear in talking about fractions, ratios, measurements and numbers is essential, but Shakespeare, writing essays but algebra and Pythagoras are really not required, particularly not for working with the under 2s.  Love, empathy, attentiveness, reading body language, a deep knowledge of child development, nutrition and hygiene, and a real interest and respect for tiny humans is what makes the difference to whether parents trust their babies, toddlers and pre-schoolers to their early years practitioner.

To further add to the nursery providers costs we have the Levy coming in for training, already inadequate funding for apprenticeships, and we really don’t know how training is to be afforded.

There is also no national organisation or sector skills council looking after the interests of day nurseries, help us form one.

So now you know why I am standing up to be counted, I believe in providing quality childcare and education while parents are at work, study or do what they need to do, it makes economic and social sense to group children for care. Outstanding childcare and education is achieved through excellent staff, and an appropriate indoor and outdoor environment, and I want the support from government – both politicians and civil servants, to allow us to do this. We know how to. At least stop blocking this, for the sake of this nation.  For now I ask that we are respected, that our working for peanuts is not taken for granted. And it would really help if

1)     Allow official top ups for childcare if no more money can be found to pay a proper rate for childcare. The current position is unethical and unfair on nursery providers, see the champagne nurseries for lemonade funding facebook page and you will see thousands of day nursery owners, managers and childminders in great stress and distress, and having to focus on finances and sustainability rather than what they are good at – providing childcare for the nation.

2)     Be fair with the rate, allow for increases in government controlled expenditure such as NMW and LW, pensions, training, and for costs of buildings and services, over which we have marginal control.

3)     Return business rates to all taking government funding for childcare – don’t leave it as optional for the local authorities as they are strapped for cash and can’t or won’t oblige.

4)     All organisations providing childcar to be zero rated not exempt so that VAT can be refunded.

5)     Allow equivalents and alternatives to GCSE C Grades (which don’t even exist anymore anyway) now – and make allowances for those caught currently so they can qualify.

6)     Support the sector to form a sector skills council to properly represent the sector – which it has never been the case to date and stop over riding day nursery employers. (eg sacking the Trailblazers because they didn’t agree with the DfE)

7)     Reflect very carefully on space per child and staff qualifications and ratios, it needs significant consultation so don’t bring changes in without this – unlike how the GCSE C grades were brought in. It concerns me that the DfE claim consultation without it being effective and also make the same accusation of others.

I am an entrepreneur, I’m not bad at finding ways around blocks, and I’m pretty good at working out what services people need in my sector and finding creative ways to deliver these. My bank manager has wondered why I chose to work in this sector, full as it is of red tape and regulation, he says I could work in any sector and make loads of money. And indeed I’ve made a bit in the property business, and in my scuba diving business before I started in day nurseries 27 years ago very shortly after the birth of my second child. The reasons I’m still in the childcare business stems from wanting the best for my own children and my friends children (my first customers) and now for my community’s children. I also run 2 care homes, I started the first one because my mother brought my step father home to the UK, to stay with me, he’d been diagnosed with early onset dementia.  I felt I could do better than the local care homes available, just like I did with the nurseries, providing a differentiated service, a service that was person centred from the start. Its been a struggle, more red tape, and lots of “if its not written down it didn’t happen”. But I think I’ve got the hang of it now, and can also see advantages for caring for children in the same location as caring for elders, and also engaging people with special needs, there are plenty of examples of Downs Syndrome sufferers being able to help care for elders and children – although still needing supervising from fully qualified and diligent professionals. We need to get our elders out of hospital and into these caring communities but there are economies of scale and of supervision that could be utilised which are currently not in place. Allow the carers to get on with the caring, enable the academics to lead on the curriculum and pilot innovative ideas with the creative entrepreneurs, encourage the health and well being experts to share their healing and skills, and allow those good with the figures and administration, marketing and sales, to all do what they are good at, for the whole group. And allow people to be responsible for their areas, keep audit to a minimum so people can concentrate on doing their jobs as well as possible rather than fearing mistakes. Together we can achieve the dream: everyone is cared for and everyone is contributing in their best way.

Cheryl Hadland 26/3/17

Managing Director/CEO

Hadland Care Group, Tops Day Nurseries, Aspire Training Team, Reside Care Homes, HCG Property, GECCO (green charity), Hadland Foundation (Staff Trust)