Nurseries are at 'breaking point' in Greater Manchester in the cost of living crisis, with owners facing a 'mass exodus'.
Wendy Hartley, 59, runs the Brown Bear nursery chain in Stockport and claims the private childcare sector is facing the biggest crisis of its time, as providers are being forced to pass on mounting costs to parents - and staff are leaving in their droves due to a lack of decent wages.
It comes after the Manchester Evening News reported that many families living in Stockport are being priced out of childcare, and are having to choose between work or sending their child to nursery.
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Some parents said they have been forced to make the difficult decision not have any more children due the cost of childcare, with one woman saying the fees were costing more than her mortgage.
Speaking to the M.E.N, Wendy said she has huge sympathy for her clients, and claims she and other childcare providers in the local area are doing everything they can to keep prices affordable.
'I've never seen the sector in such a crisis'
But she says a combination of underfunding from the government and local authority, as well as the current cost of living crisis, is forcing her and her colleagues to make some difficult decisions.
"I have been working in the early years sector in Stockport for 40 years and I have never seen the sector in such a crisis. It's on its knees," she said.
"The cost of delivering childcare places in the last year has risen by about seven or nine pc and is still rising. But with energy costs at the moment that true figure is still very much unknown. We are trying to keep costs as low as we can."
Wendy says the main issue is the promise that parents will be eligible for 30 hours free childcare a week once their child is three-years-old. Due to flaws in the system, she claims private providers are in fact having to subsidise some of the cost themselves.
"The money from the government is only paid to us over 38 weeks of the year when we are open for 52 weeks - so that has to be stretched," she said. "The government pays the money to the local authority and then they pay us.
"But the local authority tops up the funding before it reaches the frontline. So we actually get £4.44 an hour for three and four-year-olds whereas nurseries run by the local authority get £6.86 an hour.
"We do exactly the same and have the same curriculum and around 43pc of my team have a degree so we have the same level of standards. The government and local authority know it doesn't work.
"They know the £4.44 they pay us will not cover the cost of delivering that childcare place. The true cost is somewhere between £6 and £7 per child per hour."
Wendy said she hoped that controversial plans to merge Stockport and Tameside children's services would mean nurseries like hers would receive more funding, but she claims this won't be the case.
"Tameside currently offer private nurseries 21 pence more an hour. But when I asked if nurseries in Stockport will get the same when the merger happens I was told no," she said.
Despite their reluctance, many nursery providers in the country are being faced with no choice but to increase their prices, the National Day Nurseries Association has said.
"As inflation soars into double figures pushing up costs, so too does the cost of delivering high quality early education and care," NDNA chief executive Purnima Tanuku said.
"Obviously childcare providers cannot keep passing on that cost to parents who are already trying to cope with all their other rising bills. We know that nurseries are doing everything they can to keep costs down for parents, but they need to remain sustainable as businesses too."
'We are seeing a mass exodus'
Wendy says the reintroduction of business rates following the coronavirus pandemic and the rising cost of energy prices means that childcare providers have little resources left to pay their staff properly.
"The cost of living is absolutely scary and we are all extremely concerned because we don't know how this is going to affect us going forward," she said.
"We are currently having to subsidise that 'free' 30 hours offer from the government so we have to put up the fees to paying parents. We think this is really unfair and why parents are struggling to afford childcare.
"The funding from the government went up by 3.9pc in April but the national living wage went up by 6.3pc. So we can't pay our staff what they deserve and we are seeing a mass exodus that I have never seen before.
"The ones that are staying are doing it because we know how important our role is in the lives of children and their future. It is very sad that we don’t get the respect we deserve."
Wendy says she has frequently visited her local supermarket to find staff she trained in the childcare sector working behind the tills, as the pay and working conditions are more favourable. And a recent OFSTED report showed that between April 2021 and March 2022, there was a net overall decrease of 4,000 childcare providers.
"We need funding to cover the true cost of delivery and respect for how important our work is," Wendy added. "We try to keep our prices as affordable as we can so we understand totally where parents are coming from."
'The cost of living crisis isn't exclusive to homes'
Joanne Scarlett, who runs The Marple Childcare Company Ltd warns that the early years sector is at a financial breaking point, and says her business has also been hard hit by the cost of living.
"The government funding received by pre-schools is woefully inadequate," she said. Children during their most formative years deserve the very best early years education we can give them.
"The early years sector is at breaking point financially, our operating costs have risen exponentially and there is little acknowledgement of this from the government when they allocate funding to the sector, which means there is a huge shortfall between the funding we receive and the actual cost of delivery.
"The cost-of-living crisis is not exclusive to domestic homes and is hitting businesses incredibly hard too. Pre-Schools operate on the goodwill, hard work, dedication, and loyalty of the amazing staff who work in them, I fear this is not something we can rely on for much longer.
"Our amazing workforce deserves to be paid fairly for the incredible work they do, many having trained for years to achieve the relevant qualifications required, yet they are left feeling extremely undervalued, particularly due to the low rates of pay in the sector. We must do whatever we can to protect our early years settings before it is too late."
What the government says
A Government spokesperson said: "We have spent more than £4 billion in each of the past five years to support families with the cost of childcare. The number of childcare places available remains stable, as it has since 2015, and thousands of parents are benefitting from this support.
"We know there are challenges facing the sector, which is why we are increasing funding to support employers with their costs, investing millions in better training for staff working with pre-school children and have set out plans to help providers run their businesses more flexibly. This includes plans to support more childminders into the market by reducing upfront costs."
At last year's Spending Review, the government announced they were investing additional funding worth £160 million in 2022-23, £180 million in 2023 - 24 and £170 million in 2024 - 25.
They said this is for local authorities to increase hourly rates paid to childcare providers for the government's free childcare entitlement offers, in a bid to support employers with the costs they face.
What the council says
A spokesperson for Stockport Council said: "Funding is set nationally by the government and they allocate the level of funding the council receives.
"We are required to pass 95% of this funding onto providers, although in Stockport we pass 97% of this funding on. In addition to the core funding provided to the Local Authority by central government, an additional Nursery school supplementary grant is received and fully passed on to the sector.
"This funding is provided specifically for the maintained nursery school in recognition of the additional costs they incur.
"The council shares the concerns of the sector about rising costs, and is doing everything possible to support both private and Local Authority-maintained nurseries through this period."
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