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Nurseries underfunded by the government, claims FSB

A government scheme providing free nursery places for the UK’s poorest children came under fire from business leaders today.

The Federation of Small Businesses (FSB) has warned that the government is underfunding nurseries to such an extent that many now face closure.

The claim comes a week after ministers pledged to extend free childcare to parents of two-year-olds from poor areas, in a bid to close the 'social gap' in education. At present the scheme is only open to three and four-year-olds.

But according to an FSB survey, private, voluntary and independent (PVI) nurseries are losing over £1 per hour per child. Its research shows the average PVI nursery receives £3.64 per child per hour from their Local Authority, even though nursery owners claim the average cost of providing the free sessions is £4.69 per hour.

FSB chairman of education and training Colin Willman said: "The provision of free nursery places is a noble one and small businesses support it, yet in its current form the government is not only hanging itself by its own petard, but wants to hang nursery owners – and by extension nursery children too."

In the FSB survey, not a single nursery owner believed that the Code of Practice on the Provision of Free Nursery Education Places should remain in its current form.

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