The UK government has issued a warning to nurseries and childcare providers, stating that parents must not be forced to pay mandatory extra charges to access government-funded free childcare hours. This follows growing concerns that some providers have been charging parents for essentials like meals, nappies, and sun cream, effectively making the free childcare scheme more expensive for families than intended.
The updated Department for Education (DfE) guidance clarifies that while nurseries can request payments for additional services, these fees must be voluntary, and local councils should intervene if nurseries attempt to make such charges a condition of access.
Expanded Free Childcare Scheme Faces Funding Concerns
Since September 2023, parents of nine-month-old children and older have been entitled to 15 hours of free childcare per week, with this rising to 30 hours for children aged three to four years old. From September 2024, all families will be eligible for the 30-hour scheme, a policy originally introduced under the previous Conservative government.
However, childcare providers argue that the government’s funding is not enough to cover the actual costs of providing care. As a result, many nurseries have started to charge parents for additional expenses, such as food and nappies, to compensate for financial shortfalls.
Under the new rules, nurseries must clearly list any additional costs on their websites and ensure that invoices are itemised, separating government-funded hours from any extra fees.
Nurseries Struggle with Rising Costs
The announcement has been met with mixed reactions from the childcare sector. While some welcome the transparency, others warn that nurseries are already struggling financially.
Neil Leitch, chief executive of the Early Years Alliance, acknowledged the need for clear pricing but criticised the lack of additional funding, stating:
“While we fully agree that families should be able to access early entitlement hours without incurring additional costs, in reality, years of underfunding have made it impossible for the vast majority of settings to keep their doors open without relying on some form of additional fees or charges.”
He also warned that government funding does not reflect the true cost of providing childcare, especially with upcoming increases in national insurance and staff wages.
Rising Costs Put Nurseries at Risk
Many childcare providers say they face financial uncertainty, particularly after budget changes introduced by Chancellor Rachel Reeves. The latest National Day Nurseries Association (NDNA) survey found that from April 2025, nurseries expect to raise fees by an average of 10% due to rising costs.
Purnima Tanuku CBE, NDNA chief executive, warned that the government’s funding model does not cover all nursery expenses, stating:
“Taking away the flexibility for providers around charges could seriously threaten sustainability. The funding government pays to providers has never been about paying for meals, snacks or consumables, it is to provide early education and care.”
She added that increased staff wages and national insurance contributions from April will cost the average nursery £47,000 more per year, a financial burden that has not been accounted for in the latest government funding rates.
Will Free Childcare Really Benefit Parents?
The government claims that its expanded free childcare scheme will save families up to £7,500 per year, making it easier for parents—especially mothers—to return to work. However, the reality is more complex.
While the additional childcare support is welcome, some parents may still struggle to find available places due to staff shortages and high demand. Others may find that, despite the government’s funding, they still face hidden costs, as nurseries look for ways to cover their expenses.
As the September rollout approaches, all eyes will be on whether the government can properly fund the scheme or if more nurseries will be forced to increase charges—or even close—due to financial strain.
