In late April the Scottish Government published an update which stated that childcare providers could not charge any fees when families were self-isolating. SCMA raised this with the Scottish Government at that time and over the last few weeks we have discussed this with the Scottish Government and both the Scottish Government and SCMA have been in contact with the Competition and Markets Authority (CMA) about this issue.
The Scottish Government has today issued a revised
update statement in which it notes that:
- charging for privately funded childcare is and remains a matter of contractual arrangement between a childcare provider and the family concerned;
- the statement relates to advice received from the CMA and that the Scottish Government has no competence in respect of enforcement of consumer law which is a reserved matter (UK level);
- when families are self-isolating –
- the general principle is that childcare providers should not charge for services which they cannot provide, and should not put pressure on parents to make payments when those services cannot be accessed;
- there will always be individual circumstances in each case, however, the general principle is that parents should not have to pay full or excessively large fees for services that cannot be provided or received;
- payments should be of a low level (to cover direct costs);
- early years businesses and parents might both agree to revise their obligations under the contract, and some parents may also agree to voluntarily continue to make some payments during temporary breaks in service. Such voluntary arrangements should be fairly agreed, and the business should not pressurise the consumer in any way to accept the new arrangement.
As such, the principles of voluntary and low level established previously in the event of future extended closures have also now being explicitly applied to when families have to self-isolate.
SCMA Update
As members will be aware, SCMA has had a number of concerns about this including –
- the Scottish Government had sought advice and published the earlier statement at a time when a wide range of restrictions were due to be eased (including in non-essential shops, bars and restaurants), testing was being increased and it was expected that, as a result, contact tracing and the need to self-isolate may increase. Anecdotally, reports received by SCMA would suggest this has been the case around Scotland;
- we were aware that childminders have been engaging families when the need to self-isolate had arisen and been reaching agreement on a range of fees at such times. This had ranged from no fees (where families had no or low income), through partial fees to, in some cases, full fees where some families had recognised that when childminding settings were closed due to the childminder self-isolating the childminder did not charge anything and that if they as parents/carers were on full pay and being paid while self-isolating they felt it only appropriate and in some cases have insisted that childminders should accept full fees when the setting was open and their child/ren could not attend;
- if official Scottish Government guidance requires families to self-isolate and not attend settings when they are open and available, and CMA guidance restricts the charging of fees at such times, it would be unfair for already financially vulnerable childminding businesses to experience a loss of income due to a combination of Scottish and UK official guidance;
- we believe childminding settings will be disproportionately adversely affected by this position due to their small size (where even one or two children self-isolating for 10 days could result in a major reduction in income) and that 15 months into the pandemic and with self-isolation expected to continue for many months it would not be possible for many childminding businesses to sustain this reduction in income without being able to charge normal fees or, if not allowed to do so, to receive direct financial support from the Scottish Government to compensate for this loss of income.
In a recent meeting with SCMA the Scottish Government constructively confirmed that after the position had been clarified and its update statement published it would progress quickly to exploring with SCMA if financial support may be required in Scotland to assist childminding businesses affected by self-isolation as part of its on-going financial health check of the sector.
In the meantime, we recognise that members are individual business owners, we cannot tell you what to do and our role is to offer advice, guidance, support and to promote good practice. Moving forward, we would advise members –
- to follow the CMA advice of reaching voluntary agreement with parents/carers on low level fees to be charged when settings are open, but children do not attend due to self-isolating;
- in individual circumstances where families want to continue to voluntarily pay more than low-level fees to childminders, by reaching separate agreement fairly and in which no form of pressure has been applied, they are not prevented from doing so;
- SCMA will continue to explore as a priority with the Scottish Government the need for financial support for childminders who may experience a loss of income as a result of families being required to self-isolate.
For clarity by a “voluntary” agreement, the CMA guidance means that this could relate to a contractual or other agreement in which no pressure, coercion or threat has been applied and a parent/carer has voluntarily agreed to it on that basis.
4 June 2021