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Several daycares in England have gone out of business after the implementation of the free childcare policy.
England’s Department for Education introduced the policy in September 2017. Under the policy, working parents who have three- to four-year-old children are eligible for a 30-hour free childcare a week. In the program’s first year, over 340,000 children were able to attend daycares for free, allowing parents to save up to $6,500.
On the downside, the policy made it difficult for daycares to make ends meet and forced some centers to shut down. Daycare owners blamed the difficulty on the government’s underfunding. They explained that the funds are not enough to cover the centers’ operational expenses as prices go up.
For instance, the Anchors Nursery School in Hampshire, England, was compelled to shut down after 21 years because it could no longer sustain its operations. According to its owner, daycares would be better off if the government subsidized the 30-hour scheme and charged parents for the rest of the costs.
To stay in business, other daycares have asked parents to shoulder additional costs. The Abacus Ark daycares in London charge parents around $50 a day for children’s lunch and extracurricular activities. Without the additional fee, the chain would shut down.
The Pre-school Learning Alliance, an organization dedicated to supporting childcare facilities in England, said that the government needs to allocate more funds to daycares. Otherwise, more daycares will be at risk of closing next year, the organization warned.
Back in November 2017, the childcare sector wrote an open letter to Philip Hammond, the United Kingdom’s head of treasury, to call for more funding.