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The Pre-school Learning Alliance has warned of the pressure facing childcare providers as a result of government underfunding, following today's news that the voluntary Living Wage will increase by 3.6% to £8.75 per hour around the UK and by 4.6% to £10.20 in London.

The increase can be expected to have a limited effect on the early years sector, where wages have remained low for many years as a result of inadequate funding levels. A recent workforce report by Ceeda, the sector research specialist, found that while sector pay was increasing due to the National Living Wage, it still lagged behind the England average: average sector pay stands at £8.45 an hour compared to an average hourly pay across all occupations in the UK of £15.98.

The Alliance has also warned that future rises in the statutory national living and minimum wages are likely to put significant pressure on early years providers if not matched by sufficient government funding.

Neil Leitch, chief executive of the Pre-school Learning Alliance, said:

“As a country we are privileged to have such an experienced and passionate childcare workforce. But, with early years pay falling well below the national average, we are struggling to recruit and retain quality staff. Many providers would love to pay staff the Living Wage but, until the government funds the sector adequately, such an increase will be impossible.

"What's more, while the Living Wage is voluntary, it is inevitable that the statutory national living and minimum wage will soon increase as well. While it's only right that all employees are paid a fair wage, without sufficient funding from government, such a rise is likely to substantially increase the financial pressure on many early years providers, leaving some of these vital services with little option but to close.

“Our Fair Future Funding campaign now has over 5,000 parents and providers calling on government to take action on this unsustainable position. They can start at this month’s budget by recognising the true cost of ‘free’ childcare and reversing their proposed freeze on funding until 2020.

ENDS

ABOUT THE ALLIANCE

• The Pre-school Learning Alliance is the largest and most representative early years membership organisation in England. A registered educational charity, it also provides high-quality affordable childcare and education to support children and families in areas of deprivation throughout the country.
• The Alliance represents 14,000 member settings and supports them to deliver care and learning to more than 800,000 families every year. We deliver family learning projects, offer information and advice, produce specialist publications, run acclaimed training and accreditation schemes and campaign to influence early years policy and practice.
•  The Alliance website is