Children: Day Care

Department for Education written question – answered on 7th April 2020.

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Photo of Fleur Anderson Fleur Anderson Labour, Putney

To ask the Secretary of State for Education, what financial support will be available to the (a) childcare sector and (b) child minders in the event of school closures and enforced social distancing.

Photo of Vicky Ford Vicky Ford The Parliamentary Under-Secretary of State for Education

Holding answer received on 23 March 2020

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.

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

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 early years foundation stage) 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.

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 months).

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.

Further information can be found here:

https://www.gov.uk/government/publications/coronavirus-covid-19-early-years-and-childcare-closures/coronavirus-covid-19-early-years-and-childcare-closures#funding and

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses.

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