The 30-hour childcare entitlement, up from the current 15 hours a week, will be introduced from September this year, but eight local authority areas - Hertfordshire, Newham, Northumberland, Portsmouth, provision since September 2016.
Helen Gration, the owner of three nurseries in York, said providers in the city have been handed £4 an hour to take part, but claims this does not even cover the cost of "the basics of high-quality childcare".
She said: "We understand that there is no more government money available to pay realistic, necessary rates. But it is not acceptable that we are being forced to cover the shortfall and offer impossible cheap hours for something so important to a child's development and education, just to put a vote-winner in place.
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