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Why 'Profit' isn't a dirty word in Early Years!

Quality Early Years education & childcare is absolutely vital in ensuring the best start in life for our next generation.

Recent studies show a direct correlation between Early Years children reaching & exceeding ‘expected levels’ and high A Level grades, not to mention the practical terms of allowing parents to be able to go to work whilst their child accesses a quality Early Years provision.

To provide this service, Early Years providers MUST be able to continually improve their provision and be paid according to the fantastic service they offer. From CPD training and statutory qualifications, developing their continuous provision and investing back into their staff, processes, safeguarding & buildings – all of which promotes a fantastic start in life for our children. The money to do this must come from somewhere… but where? PROFIT!

For too long, the Government have knowingly & drastically underfunded the Early Years sector, whilst at the same time imposing sector crushing restraints on us, such as funding providers just two thirds of what it costs to deliver funded hours whilst at the same time imposing tight 'no-go' restrictions on providers charging a ‘top up’ fees in order to break even on the cost of delivery.

This one example (of many!) prevents providers from being able to earn enough income to even break even, let alone make any kind of profit from which we can then use to reinvest! No wonder providers are choosing to close their doors for good, with the latest data from the Government showing that between 1 April 2021 and 31 March 2022, a net overall decrease of around 4000 providers, representing the largest decline since 2015/16 [1].

A recent study by the Institute of Fiscal studies estimates that childcare providers’

costs are likely to rise by 9% between the 2022–23 and 2024–25, (compared to the projected increase of funding) showing an overall FALL of 8% in entitlement funding providers with receive for 2, 3 and 4 year olds[2].

Just how will the Early Years sector survive this? How can we be expected to provide and continuously improve high quality education and childcare on an 8% real time CUT to funding?! We can’t!

We must stand together and demand change NOW!

Our sector has many options available for those brave enough to make tough decisions. We MUST first accept that we cannot keep subsidising the costs or making private fee-paying families cover the deficit of funding. This does not make business sense. We will run our businesses (and our personal savings!) into the ground if this continues to happen. We need to charge 'real time' fees based on the 'real time' costs of our service, whilst ensuring we generate enough profit for reinvestment into our provisions... without this reinvestment, children, providers and practitioners will continue to suffer and more providers will close.

When will enough be ENOUGH?

We are stronger together, so let us stand as one. Sign up to and join the fight.


We would love to hear your thoughts - why not drop us an email? Or better still, submit your own story or Blog entry?

Footnotes [1] [2]

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