Sustainability is a big issue for nursery businesses which often operate to very tight margins. Explore the two significant financial pressures alongside rising utility bills and our guidance below.
National Minimum Wage and National Living Wage
From April 2021 the National Living Wage (NLW) increased from £8.72 to £8.91, a 2.2% inflationary increase. The eligibility age has also been reduced to include 23 and 24-year-olds for the first time, meaning for these staff, the minimum hourly pay they can receive has increased by 8.7% from the previous year.
From 1 April 2021 these rates are:
Business Rates Relief
Together with members, NDNA has successfully argued, in both Scotland and Wales, that business rates were unfair on nurseries which should be made special cases.
Since April 2018 in Scotland, and April 2019 in Wales, nurseries have been exempt from paying rates.
In March 2020 NDNA secured a Government u-turn that meant nurseries were included in the business rates holiday for retail and leisure businesses. This was extended into 2021/22 with a 66% reduction from July 2021 to March 2022. However, under current plans, business rates will return in full for nurseries from March 2022.
We are campaigning for nurseries in England to receive the same recognition. We believe that business rates are an unfair tax created for factories, shops, and warehouses and are based on space. It is this space that unfairly penalises nursery businesses, who have to offer good-sized rooms including outdoor areas for their children to play in, grow, explore and develop.
Nurseries should not end up paying more for the environment they provide children, and should not be discouraged from investment by fear of higher rates.