Almost nine in ten councils think there will not be enough nursery places to deliver the government’s proposed extension of the 30 hours funded childcare scheme.

Local Government Association (LGA) research found 88 per cent of councils predict significant numbers of nursery closures in 2023, which will mean there will not be enough places for all eligible children.

The LGA is calling for stronger powers to allow councils to ensure the right provision is available in the right places, including the ability to withhold funding where a provider wants to open in an area where there is already plenty of provision. 

In March the Chancellor announced all children aged from nine months to five years in eligible working families would be entitled to 30 hours a week of funded childcare by September 2025. The proportion of places delivered through government-funded entitlements is expected to rise from 50 to around 80 percent.

The research found that less than half of councils are fully confident of having sufficient childcare provision for two-year-olds, even under the current requirements, while 40 per cent of councils saw more nurseries closing in 2022 than in 2021. Insufficient income to meet rising costs, and workforce-related issues were the main reasons for the closures, but “poor Ofsted rating with knock-on impacts” was also cited as a factor.

The researchers also found recruitment and retention challenges were greater in disadvantaged communities, and the challenge of supporting children with stretched funding and limited specialist support is causing nurseries to lose more staff and placing greater burdens on managers.

Cllr Louise Gittins, chair of the LGA’s Children and Young People Board, said: “Alongside the improved funding rates, it is vital the government’s planned recruitment drive tackles the staffing shortages and provides an opportunity for staff to progress and thrive in a fulfilling career. Councils will also need to be given the right levers to manage local childcare markets, given the significant rise in government-funded places local areas will see.”

Purnima Tanuku, chief executive of the National Day Nurseries Association (NDNA) said: “This stark report from councils across England is another clear warning to the government that its policy risks failure without interventions to support the sector. For years we have been showing how nurseries are facing increasing pressures due to spiralling costs and chronic underfunding. Now councils are joining providers and parents in showing real concern for the viability of future expansion if we don’t fix the current system.”