Consultation on childcare charges for children under five in Islington

Islington Council is committed to supporting working families with low incomes to access high quality affordable childcare. Although an annual increase in parental charges of 2 per cent was agreed in 2014 in council-run and some community nurseries, the costs of delivering childcare have increased significantly, above and beyond the annual increase. Furthermore, the Council has suffered massive cuts in its grants from central government and now needs to target its resources even more sharply to those who most need help. The council is therefore proposing to increase childcare charges at its nurseries at a greater rate for families with higher incomes, whilst protecting those with lower incomes in order that childcare remains affordable for them.

The proposals are to:

• increase the number of income bands so that charges are more sensitive to family income
  

• reduce the amount of subsidy to parents on higher incomes
  

• better reflect the actual cost of providing places
  

• introduce a new rate for families on very high incomes or who do not live in the borough reduce the current sibling subsidy as more tax-free and free childcare is made available to working parents through government schemes
  

• give parents who are already in the system more time to plan for the impact on family budgets by phasing in the changes

Why are we asking about this?

Good quality childcare is very important to children’s development. It also means that parents are able to take up training or go to work. This helps the whole family to be independent and have a better standard of living.

The cost of providing childcare has risen sharply in recent years. At the same time, the overall Government funding available to Islington Council has been reduced by £100 million since 2010. The government is also reducing the amount of early education funding it is giving to Islington by 10 per cent by 2018, so overall there is less money for us to provide local services, including childcare for under-fives.

The council wants to continue to ensure childcare is affordable and that children can receive high quality care and support, whatever their family circumstances. We do this by contributing to the cost of childcare for low to middle income families by subsidising places. With less money available we will need to be more specific about who is eligible for childcare places at a reduced cost and to ask some higher earning parents to pay a larger share of the costs.

The proposed changes to income banding and age groups will affect how the amount you pay for childcare is calculated.

This is your chance to tell us what you think about these proposals.

Since the launch of the consultation, table 1 on page 5 and tables 1 and 2 on page 7 have been replaced. The affected bands are band 7 in table 1 (column 3&4s entitled to 30 hours free) and bands 8 and above in table 2 (column 3&4s entitled to 30 hours free).