The funding section of government guidance

We particularly want to draw your attention to the following section from the government guidance so you can access all the financial help that is available to you. We expect guidance to imminently be updated to include more information for self-employed childminders. As soon as we hear more we will be in touch. Please bear in mind that this digest is being written at midday on 26.3.2020 and the information will probably have been published by the time you read this.

What will happen to funding for free childcare offers during this period of disruption?

On 17 March 2020, the Chancellor confirmed the government would continue to pay for free early years entitlement places for 2, 3 and 4 year olds even if settings were closed on the advice of the government, or children were not able to attend due to coronavirus (COVID-19).

We expect local authorities to continue early entitlements funding for all childminders, schools and nurseries.

What additional business support is available to childcare providers during this period of disruption?

The government has announced a package of support for workers and businesses which will benefit childcare providers.

The Chancellor has announced that childcare providers will be eligible for a business rates holiday for one year. That means non-local authority providers of childcare (registered with Ofsted and providing EYFS) will pay no business rates in 2020 to 2021, from 1 April. Local authorities will be working on this.

Nurseries in receipt of small business rate relief or rural rate relief will benefit from small business grant funding of £10,000. This includes nurseries who are eligible for a charitable status relief – they will also pay no business rates at all in 2020 to 2021.

Some settings operate from shared spaces which may now benefit from a 100% rates relief. We strongly encourage those shared spaces to reflect any business rates saving in their rent charges.

The Coronavirus Job Retention Scheme means that for employees who are not working but kept on payroll, the government will contribute 80% of each worker’s wages of up to £2,500, backdated to 1 March 2020. Providers can access this scheme while continuing to be paid the early entitlements funding via local authorities.

The Business Interruption Loan Scheme will now be interest-free for 12 months (rather than 6).

VAT payments due with VAT returns between now and end June 2020 will be deferred, UK VAT registered businesses will not need make those payments until the end of the financial year.

Working tax credit has been increased by £1000 a year.

The government has also announced a £20 per week increase to the Universal Credit standard allowance and Working Tax Credit basic element and an increase in the Local Housing Allowance rates for Universal Credit and Housing Benefit claimants so that it covers the cheapest third of local rents.

For the self-employed (including childminders) the minimum income floor will be temporarily relaxed, meaning Universal Credit can be accessed at a rate to match statutory sick pay (SSP).

Can childcare providers continue to charge parents during coronavirus-related closures?

We are working hard to mitigate the impacts of coronavirus (COVID-19) on all parts of our society, including individuals and business. We urge all childcare providers to be reasonable and balanced in their dealings with parents, given the great uncertainty they will be facing too.

We will not be clawing back early years entitlements funding from local authorities during closures, or where children are withdrawn because of coronavirus (COVID-19). This protects a significant proportion of early years providers’ income. The government has already introduced a range of measures, as outlined above, to support businesses and workers during this period. We will be keeping what further support businesses may require under close review.

Can providers continue to charge for consumables such as nappies?

Providers may charge for consumables in line with national entitlements guidance. As per existing guidance, they should consider the impact of charges on disadvantaged families.