Should I still be paying nursery fees now they've been ordered to shut?

Is it ludicrous to pay fees to a nursery closed for the coronavirus? And why are some nurseries charging when others aren't? A reader asks.

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Should I still be paying nursery fees now they've been ordered to shut?
Should parents be expected to pay nursery fees, and what do closures mean for nursery staff, for families and for the UK economy? Credit: Getty

Should the Government be doing more to help nurseries, or should parents continue to support early years education staff by paying fees?

A reader has received an invoice for his child's nursery –  but it has closed for coronavirus.

Another nursery has decided to waive fees for parents (including key workers whose children are still using the service) – but has instead asked families to donate to fund meals-on-wheels for the self-isolated.

We speak to both to figure out what parents should be doing .

What do the latest measures mean for nurseries and their staff?

Last week, education secretary Gavin Williamson announced that schools and early years providers across England would be closed to all but the children of key workers in response to coronavirus. The chief executive of National Day Nurseries Association (NDNA) Purnima Tanuku described it as “devastating news” for nurseries. 

Since then, chancellor Rishi Sunak has said that nurseries will be eligible for a business rates holiday from April 1. And in unprecedented measures announced on Monday, the Government stated that it will pay 80 per cent of the salaries of staff who are unable to work as a result of Covid-19, but who are kept on by their employer (which includes nursery staff) – easing the burden on businesses, including nurseries. It is a radical move aimed at protecting people's jobs, covering wages of up to £2,500 a month. 

But many nursery workers are on precarious hourly contracts, and on already low salaries (£19,000 p/a on average for a nursery assistant, according to Totaljobs.com – some nursery workers earn in the region of £12,000p/a). Nurseries will still take a financial hit, and are likely to lose income from fees while still having rental and mortgage costs to bear and remaining staff wages to take care of, if required.

Most insurance policies do not cover nurseries for financial losses due to coronavirus, because most do not provide cover for "notifiable diseases" and pandemics. As a result, whether or not all nurseries will weather the duration of the crisis remains to be seen.

Nursery workers already receive low wages and are often employed on hourly contracts Credit: Getty

What do nursery closures mean for families and for the economy?

Now that young children will have to be looked after at home, and the services offered by nurseries will not be available to paying parents if they are not key workers, what does that mean for families? 

Should parents still be expected to pay nursery fees, either in full, in part, or not at all? It’s a similar debate faced by parents whose children attend fee-paying private schools. 

According to Helen Wong, partner at Charles Russell Speechlys law firm, whether or not to charge is a matter of discretion. “Nurseries are independent businesses, so the operators can determine whether they charge fees during these unprecedented times,” she says. “For emergency closure and exceptional circumstances, terms could state that fees paid in advance may not be refunded. In this case the fees are payable.

"However, if the closure is for a sustained period, it’s doubtful whether parents will be prepared to pay.

“Without further support, this forced closure will produce an unprecedented threat to nurseries across the UK. This may lead to a significant proportion of nurseries going out of business, which will undoubtedly have a knock-on effect on the entire economy and on individual families, as many workers will be left without childcare."

Why are some nurseries still charging, while others are not?

Some nurseries are waiving their fees, while others are continuing to send invoices out. As a result, some parents are getting angry, though others are impressed at how their nurseries have responded to the crisis.

 “I’m reaching out as a parent who is currently being asked to work from home and keep my child at home while nurseries and schools are closed due to the coronavirus outbreak,” wrote in one Telegraph reader, who wishes to remain anonymous. “Last week, the government announced significant financial support for businesses. However, our private nursery has charged us the full fees for the upcoming month when they will remain closed.

"How are parents expected to pay thousands and thousands of pounds’ worth of fees to closed nurseries? I know a lot of parents have this question but no one seems to know who to contact about this. We have tried to contact the Citizens Advice Bureau and the Department of Education Helpline, but they weren't able to provide a clear answer.

Some parents are expressing frustration at being charged for a childcare service they will no longer receive Credit: Getty

“Our nursery has now closed for children of non-key workers (like me) as part of the coronavirus lockdown, and the nursery manager is not responding to my emails. He did not send any communications to update parents on the situation and has only sent out an invoice.

"When I tried to speak to him over the phone, he shut me down each time, ending the call. I mentioned to him that nurseries of other parents that I have spoken to have waived their fees and he said that he does not care of what other nurseries do, because he is not covered by insurance.”

According to lawyer Helen Wong, an invoice is not a legally binding agreement by itself. "It very much depends on the terms the parent signed with the nursery, and whether they make clear that payment is due. If the terms that both parties have signed up for require that the payment is due and payment is not paid within the time frame, the nursery can make a statutory demand to ask for payment of a debt from a parent. If the parent is struggling to pay, the nursery can try to reach an agreement, such as staged payments.

"The nursery also has the discretion to a) waive the outstanding payment b) waive the late interest/penalty. If the debtor parent does not pay the debt or agree to the nursery’s statutory demand within 21 days, the nursery has the right to start bankruptcy proceedings against a parent who owes £5,000 or more."

However,  other nurseries have been praised by parents for their communications and for their measured responses.  “I have been super-impressed with the nursery that my 3-year-old attends in West London,” says working father David Frossman-Miller of The Garden Nursery in Acton. “They have been super communicative for weeks – way ahead of other official communications. They have looked after the well-being of kids, staff and vulnerable people in the community self-isolating. They are open at the moment to look after key workers’ children, and running a free meals-on-wheels service for free.”

Tom Kilsby, director of The Garden Nursery, explains why they have made the decision to waive nursery fees in the light of the measures enforced as a result of coronavirus. 

"We anticipated this was coming four or five weeks ago, so we went through a period of staff and parent consultation. Initially, our main concern was making sure staff would be paid at least a percentage of their salary, in the event we would have to close for what we thought might be three months. 

"Our staff (not including U18 apprentices) salaries start at £10.50 an hour (just under £22,000 p/a, based on a 40 hour week with five weeks paid holiday), going up to £18 per hour for qualified teachers. The industry is often a near minimum wage employer.

"We also wanted to provide at least some level of service and support for parents and the community, depending on how the coronavirus situation developed.

"We’ve got lots of earnings insurance, but Aviva won’t pay it, because it’s a new disease we’re not covered for.  But we’ve been relatively financially prudent, so we’ve got savings, and we were going to use those to pay staff. 

"We told parents about a month ago that if we had to shut, we obviously wouldn’t charge. Without offering a service, I felt it would be ludicrous to be charging parents, and accepted that we were just going to have to take a financial hit. Parents have obviously got their own costs and shortfalls to take care of as a result of Covid-19. I would be surprised if other nurseries were able to enforce charges in these circumstances.

"If it was a week’s closure, perhaps you could justify it - but not for this length of time, in my view. 

"As a business, we’ve been pretty successful, to be honest. When things are going well, nurseries make money. We’re lucky that we were a profitable business, so we can afford to be generous. A lot of parents, when we said we weren’t going to charge fees, said that they didn’t want us to be out of pocket, and that they’d continue to support us. I think they liked the fact we weren’t trying to grasp the fees, and were generous in return. 

Some nurseries which were previously thriving and are able to take the financial hit are happy to do so, like The Garden Nursery in Acton Credit: Getty

"Now, after the decision to close nurseries, the press conference on Monday and the statement from the chancellor that 80 per cent of staff salaries will be paid by the government, the bill for staff salaries is less of a worry for us.

"We’re only opening three days a week for the children of key workers, and we’ve decided not to charge them during this period. In the last week or two, we’ve shifted from running a nursery to focusing on providing community support and operating as a food bank. Lots of our parents have volunteered and given donations to support vulnerable people self-isolating in Ealing, and we’re working with Age Concern UK to provide them with food boxes and meals on wheels.

"We’re still paying for the building, but we’ve got our costs down as low as possible, to around £19,000 or £20,000 a month. In terms of staff, for those who don’t wish to or are unable to work, we are retaining them on the 80 per cent wage covered by the Government - but for those who want to continue to work, we are topping up their wages to 100 per cent. We’re operating at a loss, but we could probably carry on like this for about a year, if we need to.

"We have about two or three children of key workers here each day. Some of our parents work for Public Health England, another is a nurse and another is a doctor. It’s quiet - we’re used to having 115 children a day in total. I was concerned about the rates of Covid-19 infection in the children of healthcare workers and having them all grouped together, but so far we are being vigilant with social distancing (our staff don’t travel by public transport to minimise risk) and hygiene, and it’s going well. We’re lucky to have a large garden.

"The moral question of where the financial burden should lie is interesting. Should it fall on the government, the employer, parents, or the landlord? The government has picked up the bill beyond what I was expecting, even beyond what I think they should have done. As an employer, when the going is good you make money – and now we’re being bailed out. It’s a bill our children will have to pay back at some point.

"I don’t know why no one has mentioned suspending rents – private landlords could probably bear the economic brunt of this better than most. Why is the government funding our staff, so our staff can fund private landlords?”

Should the Government do more to support nurseries?

But while nurseries such as The Garden Nursery are confident about their survival, according to Leonor Stjepic, CEO of the Montessori Group (responsible for 800 nurseries and 30,000 children in the UK), there is still more the Government could do to help nurseries facing more financial pressure.

“Many independent nurseries are already under financial pressure. Unless the Government provides financial support, they cannot afford to be closed and are at risk of permanent closure, depriving communities of essential childcare, advice, and guidance,” she says.

“We know the Government has introduced a package of financial support for small businesses but, given the special role of nurseries, we call for it to do more and consider providing greater access to credit, especially for nurseries, and grants for those who may be in low income areas and cannot afford credit.”

Montessori CEO Leonor Stjepic feels the Government should take further measures to protect nurseries Credit: Getty

Stjepic also calls for support for workers who are on hourly contracts, and grants for nursery workers looking to upskill or change skills. “We know many draw salaries below minimum wage and do not benefit from statutory sick pay. According the Early Years Alliance, almost 50% of early years workforce surveyed rely on food banks. Many nursery employees will lose their jobs and will need support in training but, due to low incomes, cannot afford to pay for training that will help get back into employment.”

Finally, Stjepic calls for more support for home learning. “Montessori is offering activities for parents to use to sustain children’s education during this time. We know many others are too. Funding to upscale these efforts would help reach more parents. We know the Government has a number of calls upon it right now, and managing our health and safety is paramount, but supporting families is an essential part of that.”

How has your nursery responded to the coronavirus? Do you think parents should still be paying nursery fees? Who should bear the cost of nursery closures? We’d love to hear what you think in the comments below.