Third of nurseries may be forced to close

New research from the Sutton Trust has revealed that a third of nurseries in the most disadvantaged areas of the UK may be forced to close due to financial difficulties.

Nurseries, childminders and pre-schools are facing major financial uncertainty in the wake of the coronavirus pandemic, with many unsure as to whether they’ll still be able to operate next year. The Sutton Trust says that, at the height of the pandemic in April, two-thirds of early years providers were closed to all children, including 79 per cent of pre-schools, 59 per cent of nurseries and 41 per cent of childminders.

Of those that were closed, two-thirds expected to be open again by June, with 20 per cent expecting to still be shut and 15 per cent uncertain about whether they would be able to.

The early years sector faced financial difficulties before the crisis. But widespread closures due to the coronavirus pandemic has meant that many providers – particularly those in disadvantaged areas – have relied on government support to stay afloat, including through the furlough scheme and business rates holidays. Nurseries and pre-schools in the most deprived areas are more than twice as likely to have needed a business rates holiday compared to those in the least deprived and almost twice as likely to have utilised small business grant funding.

As a result of this financial instability, many early years providers say that they may be forced to close permanently, with those in the most disadvantaged more unsure of their future than those in more affluent areas. In fact, 69 per cent of those in deprived areas expected to operate at a loss over the next six months and 42 per cent anticipated making redundancies (compared to 29 per cent in the most affluent areas).

The Sutton Trust is making a series of recommendations to support the early years sector and ensure that the most disadvantaged children do not lose out as a result of the crisis.  At the heart of these is a package of financial assistance – worth £88 million – in line with the support announced for schools in June, which would include: transition funding to protect early years providers in the coming months while they are facing the cost of being fully open, but unlikely to reach full capacity; and a one-off boost to Early Years Pupil Premium funding for the next year, to support nurseries and pre-schools, particularly those in deprived areas, to provide more direct support for parents in terms of the home learning environment and the healthy development of their children.

Sir Peter Lampl, founder and chairman of the Sutton Trust, said: “The first years of a child’s life are crucial for their development, both in terms of attainment and their social and emotional wellbeing. Access to high-quality early years education is key to this, particularly for children from disadvantaged backgrounds. The coronavirus crisis is having a devastating impact on the early years sector, with many nurseries and pre-schools facing closure. This will inevitably have a long-lasting impact on children’s early development. Parents will struggle to find a place for their child. This will affect their ability to go to work.

“Now is the time, when the world has been turned upside down, to prioritise support for children and families. Crucially the government must introduce a package of support to protect early years providers and enable them to stay solvent.”

A separate poll of 604 parents in Britain of children aged 2-4, conducted by YouGov, found that 45 per cent of parents felt that their child’s social and emotional development and well-being had been negatively impacted by the lockdown, with those whose children were unable to attend their nursery or pre-school most likely to report this.