Sat, 31 Oct 2020
NURSERIES and childminders in West Berkshire are closing down because their income has dried up during the Covid-19 pandemic.
West Berkshire Council says childcare providers are facing financial difficulties as demand has plummeted during the pandemic and the “ongoing impact of Covid-19 is far more detrimental than imagined”.
Three West Berkshire nurseries and 10 childminders are closing down, while another 13 nurseries are struggling financially, a meeting of the council’s Schools Forum heard on Monday, October 19.
Parents have been paying for fewer hours of childcare since lockdown and the council says some are still “anxious” about sending their children back, due to concerns about job insecurity and Covid-19.
Private providers lost a considerable amount of income during the summer months, when demand is usually at its highest.
Maria Morgan, from Victoria Park Nursery School, told the meeting the summer income usually provides an important “buffer” for nurseries when demand drops in the autumn and winter months.
The money they receive from the Government scheme which pays for 30 hours of childcare a week for three- and four-year-olds with working parents has also dropped, as job losses mean fewer families are now eligible.
The council is also concerned that more childcare providers will close or be forced to make redundancies when the furlough scheme ends at the end of this week.
Nurseries across the country are facing similar issues.
The Institute of Fiscal Studies found that 25 per cent of private nurseries ran a “significant deficit” during lockdown and when they reopened in June, demand for places was down 70 per cent compared with pre-Covid levels.
The study also found the furlough scheme and Government grants have been “a significant help, but provided far from full protection”.
But in West Berkshire, the council says it must also cut the amount of financial support it gives to childcare providers over the next five years, despite the impact of the pandemic.
Nurseries receive a certain amount of funding per child from the Government and the council then tops that funding up, using money in its Early Needs Budget.
However, it is exploring plans to cut that support, because the budget is running a £999,952 deficit.
The council has agreed to begin drawing up a five-year plan to reduce the deficit in April 2022, but says there is “a need for caution” as many providers are already struggling.