Coronavirus: Fears over long-term financial impact on nurseries

The Department for Education (DfE) has been asked to set out how early years providers in England affected by coronavirus will be supported amid fears over the long-term impact of an outbreak.

Early Years leaders have called for clarity over the closure of settings. Pictures: Adobe Stock
Early Years leaders have called for clarity over the closure of settings. Pictures: Adobe Stock

The Early Years Alliance (EYA) has said the DfE needs to give clarity on what financial support will be made available, after members voiced worries about the potential financial impact of parents removing their children from setting due to illness or on advice to self-isolate.

The EYA added that its members are particularly concerned whether they would still receive "free entitlement" funding in such instances.

In the UK, there are 373 confirmed cases of coronavirus as of 9am today (10 March), with the government preparing to ask people who show "even minor" signs of respiratory tract infections or a fever to self-isolate in an effort to slow the spread of the illness, named Covid-19.

Current DfE guidance states that local authorities should ensure that providers are "not penalised for short-term absences of children", for example, due to sickness and use their discretion where an absence is recurring or for extended periods.

They should also ensure providers do not have their funding withdrawn for "short term closures of a setting", such as during local or national elections or in the event of damage to the premises”.

It is understood a number of individual local authorities have confirmed that they would continue to fund providers, but the alliance said there is currently no clear central government guidance on how, or if, the existing guidance applies to coronavirus.

Neil Leitch, chief executive of the EYA, said in a letter to schools minister Nick Gibb and children and families minister Vicky Ford, who have joint responsibility for the early years, that although the DfE has endeavoured to keep the sector updated on latest policy, the situation is rapidly changing.

“We are continuing to receive a high volume of queries with regard to the rules around ‘free entitlement’ funding, and whether or not early years providers will still receive this funding for any children who are absent through either illness or the requirement to self-isolate," he said.

"While we are aware of individual local authorities who have confirmed that they will continue to fund providers in such instances, there is as yet no central guidance on this. As such, I would be grateful if you would confirm if this something the department is looking to produce and if so, what the timescales on this are likely to be, as this will provide much-needed clarity to the sector at what is a confusing and worrying time.

“In addition, I am very conscious that for many nurseries, pre-schools and childminders, funded entitlement income is only part of the story, and that the loss of private fees through illness or the need to self-isolate is also likely to have a substantial impact. Given this, it would be useful to know if the department has made ready any contingency funding to support those providers who may face a significant loss of private income as the result of coronavirus, and if so, how and when this will be made available.

“Childcare provision plays a vital role in enabling parents to go to work and, in turn, the continued smooth running of the wider economy, and we would hope that this would be taken into consideration in any discussions on this issue.”

The National Day Nurseries Association (NDNA) has backed calls for clarity from the government.

Purnima Tanuku, chief executive of the NDNA said: “NDNA has been urgently seeking responses from the DfE and the devolved governments in Wales and Scotland regarding support for nurseries during this outbreak.

“We have asked them to clarify whether the free entitlement funding will continue in the face of nursery closures because nursery businesses will still have overheads including staff wages to pay.

“We are also talking to the DfE about cash-flow support, relaxed ratios, the costs of any deep cleaning and financial support similar to what businesses in flooding areas get because closure due to coronavirus is uninsurable.

“Following years of underfunding, nurseries across the country are in a very vulnerable position and many are struggling to remain sustainable. We would argue that they must be made a special case because they deliver funded places on behalf of governments and provide an essential service which both supports children’s early development and enables parents to take up employment and training.

“Any unfunded temporary closures could force many nurseries to close their doors permanently and this must not be allowed to happen.”

The DfE has said that, alongside Public Health England, it has been sending regular updates to all educational settings since the start of February.

It has also set up a dedicated helpline (0800 046 8687) for education leaders, teaching staff and parents to answer questions about coronavirus related to education.

A DfE spokeswoman said: “The government’s action plan sets out current and possible future measures to respond to the Covid-19 outbreak that are proportionate and based on the latest scientific evidence. They will be continually kept under review and the impact of all measures will be carefully considered.

“We are aware of concerns about the position of early years providers in the event of any Covid-19-related closures and will work to minimise the impact on individual settings.”

The Early Years Alliance has created an online coronavirus resource for early years providers which is being updated on a daily basis, and includes the latest advice and guidance for childcare settings.

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