Childcare ‘Catch-22’ as public nurseries grow

The Government’s multi-billion pound expansion of public and voluntary
childcare sectors is creating recruitment problems for private day nurseries,
according to the industry’s representative body.

The problem is threatening the viability of smaller nurseries in rural and
northern areas which are unable to increase salaries to attract staff, said
Rosemary Murphy, chief executive of the National Day Nurseries Association.

"The problem is getting worse," she said. "The only way it
will [improve] is if the Government puts money in the sector through increasing
tax credits. The alternative would be to increase fees, but I’m getting the
message the market cannot take it," Murphy said.

The Government spent £3.6bn on these services in 2002-03, mainly through
local government funding for early education and initiatives to improve the
availability of childcare, but also through the Department for Education and
Skills, which spent £680m, according to the National Audit Office. In addition,
parents pay a further £3bn annually towards childcare costs.

Private sector nurseries face recruitment competition from public sector
schemes targeting their staff and senior management, Murphy said.

"Its not recruiting staff at NVQ level three that is the problem, it is
getting management roles filled, you cannot develop managers overnight. You
need experience and the right calibre."

Senior staff were leaving the private sector to join government initiatives
to get higher salaries and further their careers, she said. Private nurseries
were offering more flexible working arrangements to try and attract staff but
many posts were still attracting no applicants. One nursery calculated that if
it were to pay staff at public sector rates, it would run up an annual deficit
of £6,500, before paying for food, business rates or its mortgage, Murphy said.

"People have a misunderstanding that private nurseries want to pay less
to pocket the profit. Actually, it is the only way the business is

At the beginning of the month, children’s minister Margaret Hodge confirmed
proposals to develop a new pilot to extend the benefits of high quality early
education and care to 6,000 two year olds in disadvantaged areas.

By Lindsay Clark

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