The government’s decision to award Knowsley Council a 1% rise in funding for childcare places has been called an “accident waiting to happen.”
The increase, which was announced in December, means childcare providers are receiving around just 5p extra an hour more to look after the borough’s children – with members of Knowsley’s school forum condemning the decision.
Part of the issue is that some areas of the country received a significantly higher increase in money to pass on to childcare providers for funded early years places – with more affluent areas receiving disproportionately more money.
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According to adviser Alistair Scott, at a meeting of Knowsley’s schools forum held on Thursday February 23, the inequality in funding has come about due to government changes in the way it is formulated – with areas with higher business rates receiving more – which tends to be in richer parts of the country.
One of the most deprived boroughs in the UK, Knowsley is receiving 3% less than the wealthiest boroughs, a situation pupil referral unit representative Rob Alcock said was an “accident waiting to happen.”
Chair Jane Maloney asked if there were “any threats” to nurseries in the borough due to the ongoing rise in costs in the light of the increase.
Mr Scott said: “Yesterday we had one provider who was reporting costs upwards of 10% with delivery of that service.”
He added the situation was especially challenging for childcare providers with more funded than fee-paying children.
Alistair said: “There is slightly more flexibility for fee-paying places in terms of rate set but again that has to be competitive.
“It is very likely to have an impact and we know through consultation in the sector it is absolutely a concern.”
When asked by the chair to endorse the report, including the 1% increase, Mr Alcock said: “It’s worthwhile saying that the group along with the council are concerned at the small percentage, as you can almost see an accident waiting to happen.”
“We’re endorsing something that personally I don’t agree with it, If we just reference in the minutes that we’re endorsing it but are concerned around the level of increase for all providers.”
The chair agreed it should be recorded in the minutes that the forum is “concerned at the level of funding provided by the government” following which the recommendations were agreed.
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