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Early education and parenting of high quality children can have a positive impact on the welfare of children and life opportunities. The ability to combine work and maintenance can benefit the whole family. However, for many parents, the cost of childcare is a significant drying in household income, and COVID-19 makes children’s parenting problems for the family worse.
In this difficult atmosphere, many day nurseries change hands. The Covid-19 crisis encourages rather than blocking the purchase and sale of nurseries. According to the Christie & CO property specialist, transactions increased by 21% between 2020 and 2021. Our research shows that, in many cases, nurseries have been purchased by large private non -profit groups.
Our research has investigated the consequences of these private non-profit groups that moved to the childcare sector. They include an increase in financial risks for the daydream nursery group, threatening the availability of childcare for parents and children.
Financial risk
The pattern of these large private groups obtains this nursery is relatively new. However, the maintenance house market is an established trend known as “finance”.
Treatment House Market Propos have been shown in recent years by the collapse of several chains, such as Four Seasons and Southern Cross. These groups cannot pay the debts they pay off to private equity companies whose investment allows them to expand their business.
Together with colleagues, we conducted research funded by the Nuffield Foundation on increased volatility of the British private parenting market over the past two decades. We found that the market range of non -profit provisions based in the UK in the UK is very large. In 2021, 70% of all group -based nurseries were in the non -profit sector.
Using the forensic accounting method, we find evidence that smaller nurseries chains and single nurseries are increasingly purchased by large companies that want to generate profits with the help of private equity funding.
This allows the company to continue to expand their provisions, while seriously in debt to their investors and need to pay dividends from their shareholders. As a result they have low financial reserves so that they are not there, put them at the risk of collapse.
Children play with blocks on the floor
The private childcare market becomes increasingly volatile. MAROKE/SHUTTERSTOCK
Shortly after we completed the account analysis of one of the five non -profit case study reports of five mediums to our size, bought with a chain of nurturing Dutch children. We found that complex financial structures involving investors and foreign shareholders, in addition to public funds, allowed these companies to increase the market share of childcare.
Loans to enable non-profit subsidiary companies to buy additional nurseries so far do not cause substantial increases in childcare places, as shown by our data of analysis.
We found that private non -profit companies in the UK charged high costs relative to the organization of Economic and Economic Development (OECD) organizations.
While non-profit childcare companies marketing themselves as providing quality care and practices that are centered on children, this research reveals lack of explicit references to care for children who are vulnerable or disadvantaged.
The non -profit is only one way of childcare provisions delivered in the UK. Alternative non -profit models including charity and social companies.
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