Nursery providers in Wales fear cost of living crisis is pushing them towards closure

Nurseries in Wales say they might be forced to close because of rising costs.

A survey by the National Day Nursery Association (NDNA) found that a quarter of nurseries are expecting to make a loss, and 90% say their funding rate from the Welsh Government Childcare Offer is not enough. 

With the rise in food, energy bills, and staff wages, the NDNA says the funding rate of £5 per hour is ‘just not enough’, citing a shortfall of £2,500 per year for every child receiving 20 hours of funding. 

They’re calling for the Welsh Government to review their funding rates every year, to reflect  rising costs, as the sector faces an ‘unprecedented situation’ 

Purnima Tanuku, the Chief Executive of NDNA has said, "the Government needs to really look at the current rate.

"We’re already seeing some nurseries closing and I think we’re going to see either reduced hours or some nurseries closing altogether”

“It's not a position where we can just say oh let's up the prices like they do in supermarkets”

Purnima Tanuku and Nikola Masters discussing how high costs are affecting the nursery sector.

Nikola Masters runs Osborne Lodge Nursery in Pontypool. She says it’s not straightforward to put up prices, as they’re always conscious of the impact that will have on families.

“We have had to look at rising our prices now from April, so we've been looking at that since January, but it's not something we can do every couple of months in order to cover the rising costs.”

The concern isn’t just about making ends meet, those in the sector say that profits are important as that money is used to invest in staff and new equipment.

“The first five years are absolutely crucial in a child’s life. It shapes their future life, so it’s important that investment needs to happen - right at the beginning, that will save millions in the long run” said Ms Tanuku.

The Welsh Government say they understand the pressures childcare providers are facing, and that they have increased the hourly rate for the childcare offer by 11% since last April.

In addition they've extended the 100% business rates relief and are making £70m available to help with the cost of developing settings.

Last month the Chancellor announced plans to extend the free childcare offer in England to children over nine months.

The NDNA says if that is to ever happen in Wales, the funding rate from the Welsh government must be looked at.

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