The local government ombudsman has told Bournemouth, Christchurch and Poole Council to reimburse a parent who complained a nursery was charging mandatory “top-up fees”.

In a report published this week the ombudsman calls for the council to reimburse the parent within one month for any “general extras” fees he has paid the nursery to date. It also recommends the council pay the parent £200 to compensate for his time and trouble in bringing the complaint.

The ombudsman has also told the council to maintain a better oversight of nurseries’ charging structures, and asked  it to write to nurseries in its area which are providing government-funded places to tell them any additional fees charged for the free places should be voluntary.

The issue was highlighted in a complaint by a father, who was concerned the nursery his child attended was charging a mandatory “general extras” fee for parents who wanted to use their funded hours during certain times of the day.  

The ombudsman’s report was compiled two years ago but has only just been published due to a legal challenge by the council. In February 2025 a High Court judge dismissed the council’s challenge.

The nursery added a mandatory “general extras” charge for parents accessing funded hours between the “core hours” of 9.30pm and 3.30pm, while parents accessing funded places outside the core hours did not have to pay the charge.

The council argued this was legal, as parents could choose to access some funded hours without an additional charge. The ombudsman however said if a place was funded by the government, all charges must be voluntary.

The ombudsman found that once the council had received a complaint, it should have ensured the nursery’s pricing policy was transparent and worked with the nursery to ensure its invoices were clear and itemised. This would allow parents to see they had received their child’s free entitlement completely free of charge and could identify fees paid for additional private hours or services.

The ombudsman has the power to make recommendations to improve processes for the wider public. In this case she said the council should ask the nursery to change its pricing policy so that it is in line with Department for Education guidance and the local authority provider agreement. If the nursery refuses to change its pricing policy, the council should consider its powers to withdraw funding in whole or in part.

The ombudsman also said the council should also send a letter to other providers in its area, inform them of the decision, and remind them of its expectations in terms of pricing.

Amerdeep Somal, local government and social care ombudsman, said: “We are publishing this report now, more than two years after it was originally made, due to a drawn-out legal challenge. We are pleased the judge has now provided clarity on the matter, by deciding in favour of our finding, which upholds the premise that any extras to the free entitlement must be clear and transparent.”

She added: “We recognise the pressures councils and nurseries face in ensuring sustainable access to free early-years entitlement. However, the law is clear that free entitlement is just that; parents should not face mandatory charges as a condition to access the scheme. When councils are made aware of problems, they must act in a timely manner to ensure that local nursery providers are following the law. I now look forward to the council implementing the recommendations to improve its services, which the report contains.”

The ombudsman previously urged councils to have better oversight of nurseries offering funded early years places after a nursery chain was found to be charging Leicestershire parents a top-up fee in 2019.

Jonathan Broadbery, director of policy for National Day Nurseries Association (NDNA), said: “Between chronic underfunding and rising costs for delivering funded hours, providers are stuck between a rock and a hard place. The majority of early education and childcare businesses need to charge consumable fees to make the funded hours work.

“While the ombudsman is clearly sympathetic to nurseries and the challenges they face in delivering funded childcare places, the funding government pays to providers has never been about paying for meals, snacks or consumables. The statutory guidance makes this clear.”

He added: “In the current economic climate, taking away the flexibility for providers around charges could seriously threaten sustainability, which will undermine efforts to improve children’s outcomes and support working families.

“It is an important principle that parents understand what they are being asked to pay for and not face blanket top-up charges. Settings need to check that they are itemising and explaining those items or services they charge for so that it is clear what hours are covered by the funding and what the government is not paying for.

“The only fair solution is that the government pays for the full cost of delivering high quality early education and care. If the childcare sector’s biggest customer does not pay its fair share then it will be nurseries, families and ultimately children, who will pay the price.”