Department for Education call for evidence: review of the cost of providing childcare

 
To help you think through your nursery costs here are some resources:
  

1. NLH Partnership resources

NLH has been commissioned by the Department for Education to carry out research into the cost of providing free places.  With permission, we are sharing the resources NLH is using in this exercise:  

Setting information `pro-forma
Delivery of the free early education entitlement research project - notes for completion of the `pro-forma’  

2. NDNA break-even template

Our break-even template is room specific, and for the purpose of evidence it will allow you to demonstrate the profit/loss of rooms that deliver funded places within your nursery.  

We hope you find these resources useful as you think through your nursery costs and the factors that make up the cost of providing free places. When you respond to the call for evidence we suggest you also share background on your nursery – for example, your history, ethos, Ofsted rating and any quality awards, such as NDNA’s e-Quality Counts, partnership working and how you contribute to your local community. 

If you have any questions about these resources or need any help please contact Deborah Robinson, Early Years Business Adviser email: deborah.robinson@ndna.org.uk   Please do not contact NLH Partnership as their resources are only being shared for information and all nurseries participating in the research study have now been selected.   

How to use the NDNA break-even template

Our break-even template is room specific, and for the purpose of evidence it will allow you to demonstrate the profit/loss of rooms that deliver funded places within your nursery.  
The shaded cells require the user to input the information, whilst the non-shaded cells will automatically calculate the figures.

The figures required for the calculator are:

The monies received for delivering a funded session.
An apportionment of costs that are required to deliver the funded places, this should be an apportionment of central overheads, staffing costs, consumables, food, cleaning, resources, heating/lighting etc.

1. Enter the number of funded places available per day (morning and afternoon)
2. Enter the days delivery takes place in the setting (can be 3 @ 5 hrs or 5 @ 3 hours for term time only delivering 15 hours per week, in the example below, it is 5 hours, 3 days per week)
3. Enter the weeks per term/year that the setting delivers, i.e. 38 weeks if term time only or up to 50 weeks if delivering a stretched offer.
4. Enter the price per place, for funded enter the amount received from the Local Authority per session, i.e. £4.00 x 5 hours  £20.00, therefore you would enter £20.00
5. The calculator will the calculate the places available for sale and the maximum income per term/year per room
6. Enter the income per term/year received, this will be the actual funding  received from your Local Authority for example a child using all their funded allocation will be entitled to  570 hours per annum and therefore we can calculate at £4.00 per hour, the setting will receive £2280 per annum per child whether, 38 weeks or longer
7. Transfer the overhead figure for the funded room – this figure should be calculated by extracting and apportioning costs by room taking into account the overheads detailed above.
8. The calculator will then demonstrate the profit/loss of the room. 
 



The screenshot example demonstrates an approximate loss of £700 per child per annum