Is £1million ‘hole’ in Leeds council’s childcare budget down to double fee increase - or free places provision?

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Leeds’s children’s centres have been left with a £1 million financial “hole” after a price hike led to a sharp drop in fee paying users, a senior opposition councillor has claimed.

The issue was raised at this week’s meeting of the council’s cabinet, where Stewart Golton, leader of the opposition Lib Dem group, asked the council’s administration if it would review its approach in the light of falling profits.

The YEP reported previously that the authority had increased its childcare costs twice within a year to bring them more into line with the private sector, rising from £41-a-day to £43 and then again to £45.

However Coun Golton suggested the hikes had been rejected by parents.

He said: “There is now a £1million hole in the [children’s centres] budget because of less than expected nursery fee income.

“I just wondered if there had been any reflection on whether or not the two price increases that have been introduced, and have actually led to a revenue fall, might be something which needs reviewing to entice our parents back into our children’s centres and maintain their financial robustness.”

Councillor Lisa Mulherin, the council’s executive board member for children’s services, acknowledged there had been a “shortfall in income” but insisted “it’s not due to the fee increase”, but rather enforced Government targets on free places provision.

“We have had a drive to provide the places for free provision for two years olds, and in order to do that we have then filled the spaces which would have been given to fee paying parents of three and four year olds,” she said.

She said the council is currently stepping up efforts to get more fee paying centre users through the doors.

“We had a Government target to fill and a short timescale in which to fill it,” she added.

“That was successful in terms of getting people through the door, but that has taken the place of fee paying parents.”