The snapshot research shows how the current economic climate continuesto have a mixed impact on private, voluntary and independentproviders.
More than two-thirds of nurseries said that parents were strugglingfinancially and just under half said that they had seen increasinglevels of bad debt.
Sixty per cent of nurseries said they would freeze staff pay to keep feeincreases down and keep childcare affordable for parents.
Although three in five said they were 'confident' about the future oftheir business, more than half said that it was a challenge to offer thefree entitlement and keep their business sustainable.
Three-quarters said paying staff more for gaining qualifications waschallenging. A number also said that they were cutting staff hours tosave costs.
Claire Schofield, director of membership, policy and communications atthe NDNA, said the research showed the impact of the recession forproviders continued to be 'very mixed' - but there was emerging evidencethat the recession was having a delayed effect on childcare.
She said, 'While the freezing of pay is being seen across other sectors,settings must not start losing their staff. It is vital that Governmentconsider increased direct support for salaries and that nurseriesthemselves look for ways to support staff - for example, reviewingcost-savings in other areas so that rises in wages do not have to bepassed to parents in full.'
She added, 'With bad debt continuing to affect cashflow, it is importantthat childcarers have the skills and knowledge to support parents whoface difficulty with payments, for example being able to advise aboutchecking their entitlements for help with childcare costs.'
To help providers in the recession the NDNA recommends:
- Local authorities should actively promote the availability of support,such as money for training and sustainability.
- The Government should reconsider abolishing tax relief foremployer-supported childcare.
- Press ahead with reforms for free entitlement funding and localauthorities must promote the option that four-year-old children can stayin existing settings for 25 hours from 2011.
The survey also revealed that many nurseries suffer in September whenmany children leave to go to nursery class or reception in school.
The NDNA said that it was vital that the option to stay on in nurserywas highlighted to parents, given the Government's plan, outlined lastweek, that all children should start school following their fourthbirthday from 2011.
ONE NURSERY'S EXPERIENCE
Catriona Savage, owner of My First Friends Private Day Nursery andPre-School, Birmingham
'In the last four weeks more parents are saying they've been maderedundant or their hours have been cut. We need to be understanding withthe current economic climate - we actively encourage parents to talk tous if they're having problems and set up a payment plan. Since Septemberwe tend to be getting new parents for two to three days a week ratherthan full-time. I think parents do want children to come to a nurserybut they are also looking for support from friends and family. Localauthorities could help us more. It's a minefield finding out what grantfunding is available. I think people should get the best qualificationsthey can, so I won't compromise on training. The council is paying fortwo of my staff to do a foundation degree but I'm paying for the othertwo. I'm concerned about losing childcare vouchers because a lot ofparents use them and VAT is due to go back up at the end of the year. Wehave to pay VAT but we can't charge parents VAT because we're not VATregistered like other industries. That has a major impact.'