Press Release

FSB urges Minister to avert nursery school crisis

28 March 2008

The Federation of Small Businesses (FSB) has written to Beverley Hughes MP, the Minister of State at the Department of Children, Schools and Families to warn of a looming crisis in nursery care.

New conditions that come into force on Sunday April 1 prohibit nurseries from charging parents extra to top up their inadequate government subsidy to cover the cost of free nursery places. Free nursery care for young children could be put at risk.

The UK’s biggest business organisation is calling on the Government to defer the Code of Practice on the provision of free nursery education places for 3 and 4 year old children. The FSB is not calling for more money from central government, but for the Code to be deferred until the funding formula has been evaluated so that nurseries can be properly remunerated for the service they provide. An FSB survey revealed that not a single nursery owner believed that the Code should remain in its current form.

John Wright, FSB National Chairman, said:

“We are in danger of sleepwalking into a major crisis for nursery provision in this country.

“Compensation for free nursery places is already woefully inadequate, the Code of Practice is not working and nursery owners are beginning to suffer.

“We received a legal opinion advising that an impact assessment of the costs of the Code should take place. If the Government does not sort out this mess now, many families could find themselves unable to get the nursery care they need in the future.”