How women are at greater risk of unemployment after the Government’s U-turn on the childcare.

Gina Narvaez reading to childre

Women at greater risk of unemployment after the Government’s U-turn on the childcare industry’s access to the Job Retention Scheme

On Friday the 17th April, the government made a disappointing U-turn in their original guarantee that day-care providers would be able to fully access the Job Retention Scheme (JRS) whilst still receiving Early Entitlement Funding (EEF) during full closure. Providers have now been told in update and guidance that they may only claim JRS for the proportion of staff not funded through the EEF. Furthermore, whilst the government would continue to pay EEF, Local Education Authorities can redistribute these funds to focus on supporting those providers which remain open for vulnerable children and children of keyworkers.

This news came after some nursery providers had already closed, furloughing their staff on the understanding that the JRS would cover 80% of the full workforce’s salary whilst remaining liabilities would be supported through the EEF & businesses’ own limited finances.

The actual and potential implications of this are drastic. An industry which holds women in the majority of their workforce, is now in jeopardy. If that doesn’t cause concern, then maybe the knock-on effect this will have on the general workforce will; employees up and down the country unable to return to their employment if day-care providers collapse. Greater Manchester Combined Authority and our Mayor have recognised how important quality Early Years provision is to breaking inter-generational disadvantage and ensuring the next generation have world class skills. 583 nurseries are registered in Greater Manchester alone [1], a collapse in the Early Years sector would be a setback for our region’s future.

Just under a year ago, my youngest started day-care. This was a private nursery we had used many years previously and had just been awarded Ofsted ‘Outstanding’ status. The day-care has been more than fantastic, the staff have created a comfortable home from home and cater to his medical needs so diligently. When the country went into lockdown in late March, they remained open, as many did, to look after the children of key workers.

A few weeks later we received notice that the nursery was closing entirely as they couldn’t guarantee the safety of their staff and children – quite obviously it is difficult to maintain social distance from babies, toddlers and pre-schoolers whilst simultaneously providing care.

Child with female carer

Studies have shown how young children can be mild or asymptomatic carriers of Covid-19, increasing the risk of transmission between families [2]. I enquired as to whether the fees would be reduced as a result, reflecting the assumed reduction in outgoings for the nursery as a result of the widely-publicised government job retention scheme for furloughed staff. I was instead informed of the government’s updated guidance asserting the 80% salary assurance would not extend to all day-care staff, and asked if we could continue to provide some form of payment to help preserve the future of the nursery. Quite the ‘rock/hard place’ dilemma for both of us. Reading similar accounts online, we have noted this was being experienced across the country. Parents are reporting being asked to provide varying amounts as ‘retention’ fees from 5% – 60% or greater with no standardisation or guarantee of reimbursement.

It seems eligibility for the Job Retention Scheme (JRS) for day-care staff is complicated due to the dual income sources many receive. Private day-care nurseries can receive a portion of income from the government as part of the early years ‘free hours’ provision, intended to support the access to early years education for families. However, the majority income of these businesses is still derived from private fee-payers. If they remain open to vulnerable children/children of key-workers, providers can furlough only from the proportion of the workforce ordinarily funded through private profits who will then receive 80% of their salary via the JRS. The remaining workforce would be funded through any EEF still being received and the private fees for the reduced number of children. If a day-care provider closes to all children, the LEA have the capacity to redistribute any EEF to those providers remaining open, opening up the JRS salary provision to more staff. However, a day-care provider’s outgoings are not restricted to salary; The reduction in income is not proportional to the reduction in salaries & liabilities (overheads, insurances, bills etc.) which remain higher, leaving the nurseries operating at a deficit and at real risk of permanent closure.

Avoiding redundancies and preserving businesses may ultimately depend on the generosity of parents continuing to make some form of payment for a service they are no longer receiving. Choosing to continue to deliver the service in return also isn’t a feasible option – remember the earlier mention of the impossibility of maintaining safe social distance from and amongst young children? Without support, the childcare industry is at risk – an industry which has a 98% women workforce. [3]

Despite the low media coverage of this evolving issue, there are a number of discussions and campaigns taking place. GM4Women2028, a group covered by Helen Pankhurst, is championing these and encourage others to get involved and amplify this support by writing to your MP , Signing the petition or joining the online panel discussion ‘STRUGGLING TO SURVIVE: WOMEN, WORK AND WELFARE’, hosted by the Fawcett Society on the 28th April

You can also read more by following the links below for more information:

Early Years Alliance

The National Day Nursery Association (NDNA)

Coram Family and Childcare Trust

Sarah Mohammad-Qureshi

Education Committee Representative, GM4WOMEN2028