The Consortium

CALLS FOR BETTER EARLY YEARS FUNDING AS RECESSION BITES

But there are still reasons to be cheerful, according to survey from early years from The Consortium

The government urgently needs to introduce direct payments for cash-strapped early years settings to help them survive the recession.

And, in a bid to keep their business going, many settings are either freezing fees or cutting any planned increases for 2009.

These are among the many findings of a new survey carried out by early years from The Consortium, the UK‘s leading independent supplier of resources to the early years sector, which looked into the effects of the recession on early years settings across the country.

Although the results have revealed some disturbing trends for the sector as the UK slides deeper into recession, it is not all doom and gloom and many settings are optimistic about their future.

When asked if the recession was having a detrimental effect on their business, 19 per cent said that it was, and a further 16 per cent reported a drop in occupancy levels over the last six months.

More than a third (37 per cent) of respondents said that the biggest economic threat to their business was parents being made redundant and no longer requiring childcare.

That was closely followed by the 26 per cent who thought the biggest threat was bad debt from parents who were unable to meet their nursery fees.

Brian Potter, sales and marketing director at early years from The Consortium, said: “For working families good quality nursery care isn‘t a luxury, it‘s a necessity.

“However, it appears from our survey that although we are still in the early days of this recession, many settings are preparing for the worst based on the logic that if parents aren‘t working they won‘t require, or be able to afford, childcare.”

When asked what support they needed during the recession, a massive 62 per cent of settings called for increased funding for free early years entitlement and almost a third (29 per cent) said they wanted direct payments for tax credits.

One survey respondent, Anne O‘Mahoney, owner of the Farlea Childcare early years setting in Staffordshire, said: “Direct payment is needed urgently for tax credits. We know a high percentage of parents receive them, but we still have instances of ‘bad payers‘ who don‘t pass the money onto us and treat the credits as part of their income.”

“This is clearly a widespread practice which threatens early years settings‘ survival,” said Brian Potter. “Many of our respondents are calling for a direct payments system to be introduced in regards to tax credits and I would urge the government to consider this proposal which would be of great benefit to the sector.”

On the subject of charges, a full 18 per cent of respondents said they were freezing fees for the foreseeable future, and a further 31 per cent said they would increase fees, but by less than planned.

However, while there was serious concern about the economic impacts of the recession, most early years settings were upbeat about the future, with more than two thirds (67 per cent) of respondents saying they were confident about their setting‘s ability to survive the next 12 months.

Indeed, some settings appear to be thriving despite the recession, if comments from Linda Rodney, owner of the Children‘s Nest Nursery in Hertfordshire, are an accurate barometer.

She said: “At present we are getting more children every month and our new nursery has been overwhelmed. It has been open for six months now and is doing very well.”

“The results of this survey are very telling and reveal a sector which appears to be starting to feel the knock-on effects of the recession,” said Brian Potter.

“Yet for all the bad news early years settings remain positive about their future and, while they continue to provide excellent quality of care for children, there will always be parents out there who will pay for their services.”

ENDS 22nd April 2009

For further information please contact Louie Hadley, Sturgess Van Damme, on 01275 349011 or email louie@sturgessvandamme.co.uk