Maintained nursery schools in Lancashire face financial collapse if the government stops covering the extra costs which they have to bear compared to other providers of early years education, councillors have been told.
Even if the special grant which they receive is spared, funding pressures on the council-run establishments could still force some to close or merge with primary schools within the next three years, a meeting of Lancashire County Council’s education scrutiny committee heard.
Maintained nursery schools have to employ qualified teaching staff, unlike operators in the private and voluntary sector – although some of them choose to do so.
“If the grant is not maintained, I’m struggling to see a viable future for maintained nurseries,” Andrew Good, the authority’s head of school finance, said.
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The government has so far committed to retain the extra cash – totalling £3.7m a year for the county’s maintained nurseries – only until the end of summer 2020. A decision over its future was expected in the comprehensive spending review due this year, but that has been delayed by Brexit.
There are 24 council-controlled nursery schools in Lancashire, with the majority located in the East of the county and others in Preston, Chorley and Lancaster. Some areas – like Fylde and Wyre – have none at all.
All early years providers in Lancashire – whether council-run or private – receive the same flat hourly rate per pupil, as set by the government. At £4.30, the county is the lowest-funded area of the country and the maintained sector is already struggling to balance the books.
Maintained nurseries have the highest financial risk of any category of school in Lancashire. Intervention and support from council officers has seen the number of nursery schools closest to a financial cliff edge reduce significantly over the last twelve months – and 18 out of the total 24 are now deemed sustainable in the short-term.
But committee members heard that the situation is likely to unravel over the next three years, with 17 facilities forecast to be in deficit by 2021/22 – and an aggregate shortfall of £1.5m across the maintained sector.
Currently, two nursery schools are in the two most perilous financial risk categories – with one unnamed establishment under-subscribed and “some way off” finding a solution to its problems, papers presented to the committee reveal. That school has recently undergone a staff restructure to help stem its losses.
Andrew Good warned others could find themselves teetering on the brink in the medium term.
“In two or three years, we may need to look at closures if we can’t come up with a sustainable solution.
“Most maintained nurseries are [located] near primary schools, so [incorporating them into the schools] might be one of the most viable solutions we’ve got for most of them,” he added.
There are already over 150 primary schools offering nursery provision across the county.
Standalone maintained nurseries have a greater proportion of pupils with special educational needs and disabilities and the meeting heard that “conversations” are taking place with the NHS about making a contribution to their running costs.
Federations of nurseries working together were also suggested as a possible solution to the financial problems facing the sector.
Committee chair County Coun Christian Wakeford described nursery schools as “the jewel in the crown of our education service”.
“It is right that we do what we can to protect them,” he added.
It is thought that the locations of some of the county's nursery schools could date back to World War One, when they were out in place to help mothers who were working in the munitions factories.
There are currently 2,522 pupils in maintained nurseries out of 25,510 children receiving some kind of early years provision. The places are a mix of those funded by the government's free child childcare commitments for selected two, three and four-year-olds and those paid for by parents.
24 - number of maintained Lancashire nursery schools
533 - number of childminders offering funded early years education in Lancashire
332 - number of private day nurseries in Lancashire
117 - number of pre-school playgroups in Lancashire
97 percent - of early years providers in Lancashire are rated good or outstanding by OFSTED, above the national average.