A Guardian analysis shows the poorest areas are suffering most from childcare closures and takeovers.
Nearly a third of not-for-profit nurseries in England’s most-deprived areas have closed or been privatised between 2018 and 2022, amid fears that the poorest are being hardest hit when it comes to childcare availability, according to an analysis by The Guardian.
The Guardian analysed more than 18,000 childcare providers in England and found that the number of not-for-profit nurseries has fallen by 23% in the four years to 2022 while those run by private companies has increased by 10%.
According to its figures, the number of not-for-profit childcare places in the poorest areas fell by 21% , although the number of under fives living there only decreased by 15%. Meanwhile, the number of all childcare providers fell by 10% in the most deprived areas, with the number of available places falling by 2%. By contrast, although the least deprived areas saw a 4.3% drop in the number of nurseries, this was more than compensated for by a 5% increase in the number of places.
The analysis follows concerns that childcare provision in the poorest areas is being hardest hit as a result of rising costs, falling roll numbers and staffing issues. Childcare organisations have been warning for some years that the sector is on the brink of mass closures due to rising costs and poor staffing. Meanwhile, private equity organisations have been increasing their influence in the sector. The Government says its announcement of a massive expansion of childcare will address some of the issues, but providers are worried that underfunding of ‘free’ places, particularly for three and four year olds and staffing shortages, will make the financial outlook for nurseries more difficult.
Purnima Tanuku, Chief Executive of National Day Nurseries Association (NDNA), said: “Every nursery closure is heartbreaking for the children, staff, families and local community. Sadly, nurseries in deprived areas are more likely to close because they have a higher proportion of government-funded children to parent-paid children. This means these nurseries have to try to cover their costs on insufficient funding rates – our Spring survey revealed that 98.4% of nurseries made a loss on funded places.
“Children from deprived areas are those who benefit the most from high quality early education and care. This quality of early learning opportunities really makes the difference for their future life chances and can close the attainment gap which widens during their school years.”
She added: “It’s important that there is a mixed market of early education and childcare settings, because this gives more parental choice and meets the needs of the local community. However, 83% of nurseries who responded to our business costs survey did not expect to make a surplus this year. So the vast majority of nurseries, private or voluntary, are not making any surplus which means they have no money to invest in staff training or in updating the learning environment for children.
“Voluntary settings make up around 30% of the PVI sector so have an important role to play. However, only 10% of voluntary nurseries are part of a group and we know that single site nurseries are more vulnerable to financial challenges.
“The single biggest cause of closures is government under-funding for three and four-year-old places. If the Government is committed to meeting the demand for childcare places and having a diverse sector, they need to address underfunding urgently.“