The early years sector cannot afford another minimum wage increase without a substantial increase in funding, according to evidence presented to Commissioners at the Low Pay Commission.

Sector organisations including the National Day Nursery Association (NDNA) and the Early Years Alliance attended the evidence session to say that mandatory wage increases will affect the sustainability of nurseries if Government funding does not keep pace.

The Low Pay Commission is an independent body that advises the Government on the National Minimum Wage (NMW) and National Living Wage for over 25s.

Jonathan Broadbery, NDNA’s Head of Policy and External Relations, raised concerns that increasing the NMW at a time when funding rates impose a cap on providers could impact levels of qualified and experienced staff within the sector as nurseries cannot afford to pay wage differentials to higher qualified staff.

Early Years Alliance chief executive Neil Leitch told the Low Pay Commission that the average wage for nursery managers is £13.97, compared to £20.42 per hour for comparable professional occupations. He also shared evidence from early years expert CEEDA, which found that 77% of early years providers had found a vacancy hard to fill in 2018.

The sector is calling on the Government to urgently review their funding rates in the light of rising NMW costs, pension contributions, business rates and inflation.

Neil Leitch said:

“There is no doubt that dedicated early years professionals deserve better pay. But the government cannot on the one hand freeze funding for its flagship childcare schemes and with the other, enforce statutory pay rises on providers. It’s completely unsustainable.”

“Giving evidence to the Low Pay Commission offers us another route to tell government decision-makers what they already know: that the sector will fall deeper into crisis if it has to bear another minimum wage increase without government stepping up urgently and plugging the £662 million shortfall in early years funding.”

Last reviewed 22 July 2019