Funding U-turn plunges Midlands nurseries into crisis
Midlands nursery schools say they have been pushed to the brink of closure after a U-turn on financial support.
A package of measures had been promised to nurseries, but restrictions placed later have left many in crisis.
Providers could initially access support from the Coronavirus Job Retention Scheme and ‘free entitlement’ funding, but the Department for Education announced new rules last week.
Nurseries across the region are providing a vital lifeline for the families of key workers, but do not have the financial stability enjoyed by schools.
Tipton Toddlers in Dudley Port sent out nine redundancy letters this week after the changes cost them £5,000 in a month, with bosses warning the nursery may not survive the lockdown.
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Director Kerry Whitehouse said: “We can’t sustain such a loss, and there will be further losses in May and into the summer when we are usually quiet anyway.
"We’re trying our best to remain viable, but if this continues we simply won’t be able to carry on.”
The nursery, a community interest company, remained open for the children of key workers during the early weeks of the lockdown.
But as numbers dwindled, 18 of its 23 staff were put on furlough. The nursery closed when it was down to one pupil and losing £600 a week in fees.
Business manager Vicky Powell said they decided to furlough staff in the expectation they would receive 80 per cent of their wages from the Government.
But under the new guidance the maximum amount of furlough was reduced to 58 per cent.
Identify
“We made the decision to furlough rather than make people redundant, but instead of breaking even for April we are facing a £5,000 loss,” she said.
“As a result we have had to identify nine people for redundancy. The Government has asked us to avoid redundancies and we tried to do that, but it has been financial suicide.
"We feel like we have had the rug pulled from under us.”
Councillor Richard McVittie, who is on Sandwell Council’s education panel, said: “Asking people to shut businesses with promised support and then to take that support away just is not on.”
Neil Leitch, of the Early Years Alliance, said it was unacceptable that the Government had “watered down” support and demanded a rethink, warning: “Otherwise when all this is finally over, there may not be a childcare sector left.”
A petition calling for the Government to reinstate full furlough funding for childcare providers has been signed by more than 130,000 people.
The Government says that by paying nurseries free entitlement funding and wages through the furlough scheme, providers could receive double-funding.
A DfE spokesperson said "significant" financial support had been offered to providers.
