Nurseries fear for troubled young

State nurseries currently receive higher levels of funding

State-run nurseries say a shake-up of early years funding will force them to reduce provision for children from disrupted and disadvantaged homes.

A new funding formula, effective from April 2010, aims to give England's private nurseries the same higher funding that state-run pre-schools get.

Opponents say it will allocate the state centres up to 35% less, while private nurseries get "pennies" more.

They say it is too complex and have taken their concerns to a group of MPs.

Appearing before the cross-party Commons children, schools and families committee, critics of the new funding arrangements said it was too complex and took "a lot from relatively few to give little to many".

The system could also have ramifications for a government pledge to offer free full-time nursery places for children from the age of four.

Earlier this month the government said that, from 2011, parents who felt their four-year-old was not ready to start mainstream school would be able to take up a nursery place instead.

'No win'

Megan Pacey, chief executive of Early Education, which represents pre-school care providers in the state and private sectors, said the new early years funding formula was "a no win situation for everybody".

It's not working for anybody and I think it's time to put the brakes on Megan Pacey, Early Education

"The feeling I'm getting from my membership is that I have people in the maintained sector who are losing somewhere between 20 and 35% of their budget almost overnight and that's having a huge impact," she told the committee of MPs.

"At the same time I've got [private sector] members on the telephone telling me that what has been proposed under the single funding formula might add pennies to their bottom line and they need a lot more than pennies to deliver what the single funding formula is all about.

"Now that strikes me that it's not working for anybody and I think it's time to put the brakes on, reassess the whole situation, really look properly at what this is about and take it forward from there."

Reduced care

Jean Ensing, chair of governors at the Bognor Regis Nursery School and Children's Centre, told MPs her organisation stood to lose nearly £100,000 under the single funding formula in the first year alone.

Ms Ensing said this cut in funding would lead to five staff being made redundant and would force the centre to reduce provision for some of the most disadvantaged children.

One of the biggest changes, she said, was that pre-schools in the state sector would no longer be funded as if they were full, but rather on the basis of how many places were taken.

This meant that state nurseries, which often kept places open for some of the most vulnerable children, would no longer be able to accommodate them at short notice.

"The planned places, we really need and use them - we have referrals suddenly come in, a bereavement, mental health problems with a parent, a parent going to prison, social isolation, children found on their own, substance abuse.

"If we had to fill up in September and we didn't have the extra space, we couldn't take them in.

"It's going to cost society a great deal more for those children and those families to be broken up and the different aspects dealt with elsewhere."

Freelance consultant Barbara Riddell told the committee of MPs that nurseries in the maintained sector must be protected as they had a specific role to play.

She said they catered for "a significantly different group of children" because their admissions policies were not down to the parents' ability to pay.