Question to the Department for Education:

To ask Her Majesty's Government what assessment they have made of the finding in the Department for Education report Survey of Childcare and Early Years Providers and COVID-19, published on 26 October, that 45 per cent of nurseries and pre-schools and 55 per cent of childminders expect to remain financially sustainable for the next year; and what action they intend to take to support those childcare providers who do not expect to remain financially sustainable.

The government recognises the importance of supporting the early years sector financially during the COVID-19 outbreak.

We are continuing to fund childcare at the same level as before the COVID-19 outbreak, until the end of the calendar year, giving nurseries and childminders another term of secure income, regardless of how many children are attending. Early years settings will continue to benefit from a planned £3.6 billion in funding for the 2020/21 financial year, to create free early education and childcare places.

My right hon. Friend, the Chancellor of the Exchequer, announced on 25 November 2020 a further £44 million investment for the 2021/22 financial year. We can now also confirm that in the 2021/22 financial year, we will increase the hourly funding rates for all local authorities by 8p an hour for the 2 year old entitlement and, for the vast majority of areas, by 6p an hour for the 3 and 4 year old entitlement. This will pay for a rate increase that is higher than the costs nurseries may face from the uplift to the national living wage in April 2020.

Additionally, the government has provided a package of support for individuals and businesses which are directly benefitting providers of childcare. This includes business rates relief and grants, the extended Self-Employment Income Support Scheme (SEISS) and the extended Coronavirus Job Retention Scheme (CJRS), which will remain open until April 2021, with employees receiving 80% of their current salary for hours not worked, up to a maximum of £2,500.

Our ‘Survey of Childcare and Early Years Providers and COVID-19 (Coronavirus)’, published on 26 October 2020, contains information on early years providers’ use of the CJRS and how many childminders applied for and received government support. This can be accessed here: https://www.gov.uk/government/publications/survey-of-childcare-and-early-years-providers-and-covid-19-coronavirus.

At the time of the survey (July 2020), 76% per cent of open group-based providers and 14% of open school-based providers reported having made use of the CJRS at any point.

At the time of the survey, all childminders were asked whether they had applied for any financial support from the government due to loss of income (for example, via the SEISS or the Small Business Grant Scheme). The majority of all childminders (86%) reported having applied for financial support from the government. Of these, 80% have received support and 6% had applied for but not yet received support. 14% of childminders had not applied for financial support.

The government continues to work closely with both local authorities and early years sector organisations to monitor the impact of the COVID-19 outbreak on the sector. We continue to both look at the costs associated with the outbreak and to secure the best and most appropriate support for the sector.