Nursery closures rise by 50%, NDNA research shows

The National Day Nurseries Association documented 186 nursery closures in 2022-23, compared to 124 closures in the preceding year.

Children playing at nursery


Nursery closures in England rose significantly in 2022-23, with a 50% increase compared to the previous year, according to research released today by the National Day Nurseries Association.

The NDNA documented 186 nursery closures during the 2022-23 period, compared to 124 closures in the preceding year. Poorer neighbourhoods were disproportionately affected, in line with previous years, with 37% of nursery closures taking place in the 30% most deprived areas of the country.

Rishi Sunak’s government used its spring budget to announce a huge expansion of free childcare for families, following pressure from employers, campaigners, MPs, and parents. The expansion is set to be introduced in stages from next spring.

But childcare providers have raised serious concerns about the pledge, given England’s shortages of childcare places and staff, as well as the fact that the government has earmarked less funding for the scheme than economists say is needed.

The government already provides too little funding for its existing free childcare schemes, leaving nurseries, childminders and pre-schools to make up the shortfall themselves. These shortfalls are the main driver of the increased nursery closures, the NDNA said.

Every nursery closure is devastating to children, their families, staff and communities.

“Every nursery closure is devastating to children, their families, staff and communities,” Purnima Tanuku, NDNA chief executive, said in a statement. “It is unfair that nurseries are having to close their doors for good because the early-years funding has been [too] woefully inadequate to be sustainable.”

In the spring budget, the Government allocated £240m to boost funding for its existing free hours schemes in 2023-24. The Women’s Budget Group had previously forecast that £1.8bn would be needed to make up for the shortfall providers are experiencing.

Nurseries are also struggling to balance the books due to this year’s rise in minimum wage, as well as the UK’s persistently high rates of inflation. Amongst the nurseries that are staying open, large numbers are reducing their opening hours to make ends meet, according to research from the charity Coram Family and Childcare this year.

In the spring budget, the government earmarked £4.2bn in 2025-26 for its free childcare expansion, which is when the proposed set-up would be fully in place. The Women’s Budget Group estimates that this is less than half of what is needed, setting the true level of investment required at £9.4bn.

Baby and toddler groups

The NDNA report comes as a separate survey found that one in five baby and toddler groups in England are worried that they could be forced to close within the next year, as a result of rising costs.

Just over three-quarters (76%) of people who run a baby and toddler group had seen their costs in the last year, with more than a quarter (26%) reporting ‘significant’ increases, according to the poll by the Early Years Alliance poll. Running costs had risen by 20% on average.

Many families use baby and toddler groups, sometimes referred to as ‘stay and play’ groups, during parental leave and once parents return to work (given that many parents return to work part-time). These groups give both adults and young children a chance to socialise and take part in different activities, thus playing an important role in preventing isolation.

In the survey, more than half (51%) of the people who run baby and toddler groups said they had signposted families to relevant services, such as food-banks. A quarter said that they or their group has donated toys, book or other resources to families.

Most groups charge small fees to attend, sometimes with adjusted rates for disadvantaged families, but just over one in five (21%) groups said they could not cover running costs using attendance fees alone.


Update: There was a 7% fall in the number of officially registered childcare and early-years providers between March 2022 and March 2023, a separate Ofsted report later in the week showed. Much of this is due to a continuing fall in childminder numbers, which were down by 11%. The overall number of childcare and early-years places on the register fell by 2% on the year.

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