Top-ups and the free entitlement

I see members of the Commons Public Accounts Committee (PAC) have been getting hot under the collar over how the DfE is spending £1.9bn of government money on early years with “limited understanding” of where it is being spent and how it is not being “not properly monitored”.
 
The other issue cover by the PAC was the alleged widespread practice of “top-ups”. The term “top-up” to many in the early years business refers to parents being charged a compulsory additional sum over and above the “cash value” of the funded hours. This is normally to make up the shortfall in terms of the setting’s normal fee levels.
 
This practice is in direct contravention of the DfE's code of practice on the administration of the free entitlement, which was published today (30 May). If settings are carrying out such practices they must stop because as far as I am concerned if you are prepared to contravene one part of the code of practice just because you don't like it, you will be prepared to contravene other areas which could have major implications to child welfare. Beware: cheats normally cheat in more than one area - ask any policeman.
 
Also, why aren't the local authorities in these alleged areas where this practice is widespread not checking up on providers. The LA has just as much duty as anyone to ensure that the funded hours are provided free and if they are not, it is councils that have the power to remove these unscrupulous providers from their list of approved provision.
 
Some would argue that forcing parents to purchase additional hours over and above the free hours is not directly '”topping up” as the setting does not ask for a monetary increase above the value of the free hours. 
 
However, is the refusal by a provider to offer a funded-only place against the code of practice while at the same time only being willing to take the child if the parent agrees the setting’s normal terms and conditions which would include the purchase of additional hours over the 570 free hours a year?
 
I accept that compulsory extras, such as charges for uniforms, on a funded only place are against the code of practice. Voluntary extras have always been allowed.
 
The consultation copy of the new code of practice - Section 1.9 placed responsibility on local authorities to "ensure that providers that charge for meals, optional extras or additional hours of provision outside of the free entitlement do not do so as a condition of children accessing their free entitlement".
 
It will be up to individual LAs to come up with their own interpretation of this clause. I only hope that these rules are realist. Most private nurseries are only managing to scrape by with all the increases in costs in the past few years.
 
But can a government insist that a private business MUST make a “funded only” place available to every parent that requests it?
 
Such an insistence would have major detrimental impact on the finances of a setting.
 
It has been the practice in my nursery to offer a limited number of funded-only places in the run up to a new term.  Once those places have gone they've gone and parents then must conform to the nurseries normal terms of business.  The two main reasons we only offer a limited number of places are
1.     As a day nursery the vast majority of my business comes from working families who require full year around childcare and for more than 15 hours per week
 
2. I can't afford to have days and sessions occupied by funded only children and at the same time turn away fee-paying families that require my services 52 weeks a year not just 38.  If the level of funding matched my costs to provide a free place I may be encouraged to take more funded only children.
 
I'm unaware of any government or anyone in the DfE producing as business plan based on providing funded-only places to anyone and everyone who requests one in a day nursery setting?  I think not, as if anyone had they would soon realise their model was a disaster waiting to happen.
 
Unfortunately, every survey, poll and account I've read, seen or heard in the past five years has demonstrated that the level of funding is well below the cost of providing the service.  Even children’s minister Sarah Teather agreed when asked if £2.25 was an acceptable hourly amount to provide a free hour of entitlement at the NDNA Annual Conference last June. 

Rates do vary from one local authority to another but, according to the government’s own National Audit Office, the national average was only £3.95 for 2010/11.   
 
PAC chair Margaret Hodge said that “all parents know exactly what their children are entitled to” and “it is unacceptable for any parent to be charged for what should be a free entitlement. It is also completely unacceptable that some parents cannot access the free education unless they agree to pay 'top-up' fees for more hours.”
 
Unless things happen differently in Yorkshire, my parents know exactly what they are entitled to and woe betide any provider around here if they tried to charge any form of top-up!
 
But I do agree that there is some confusion among parents as to the finer detail of the scheme. Unfortunately, like many school or nursery gate rumours there are often fictional accounts abroad.  The most common one is that you can only get the free entitlement at a “playgroup” or that you can pick and choose the days and hours you want, not, what you are offered and I think that sometimes can lead to a lot of misunderstandings.
 
I think some of the anecdotal evidence given to the PAC has been based on parents not understanding that they can't always get their child's free entitlement from the high-quality daycare setting that they would like their child to go to but there will be a place available in their local children's centre, school, playgroup or similar setting. 

The demand for quality early years is outstripping supply and like schools, daycare providers must put limits on the numbers they take.