Business advice - common questions
The early years sector remains, understandably, extremely worried about the impact of Covid-19 on their families and future sustainability as charities or businesses.
Clearly, the pandemic is far from over for childminders, nurseries and pre-schools, and we continuing to raise the issue of how the sector will be supported to government.
The Coronavirus Job Retention Scheme (or furlough) and the Self-employed Income Support Scheme have both now ended.
For an overview of what government support is currently available for businesses in light of ongoing Covid-19 disruption, please visit: Financial support for businesses during coronavirus
What business support is available for childcare providers?
Statutory Sick Pay Rebate Scheme
The Statutory Sick Pay Rebate Scheme (SSPRS), reintroduced by the Treasury in December 2021, reimburses small and medium-sized employers’ COVID-related SSP costs (£96.35 a week) for up to two weeks per employee.
Eligible businesses will be able to make an SSPRS claim online via HMRC from mid-January for any Covid-related staff absences occuring from 21 December 2021 onwards, .
Eligible employers must be UK-based, have fewer than 250 employees (as of 30 November 2021), a PAYE payroll system in place (as of 30 November 2021 at latest), and have already paid their employees’ COVID-related Statutory Sick pay.
More infomation is available here: COVID-19 economic support package
- The Recovery Loan Scheme
The government has extended its Covid-19 recovery loan scheme to 30 June 2022, in light of the spread of the Omicron variant. However, a number of changes to the scheme are applicable from 1 January 2022:
- The scheme will only be open to small and medium sized enterprises.
- The maximum amount of finance available will be £2 million per business.
- The guarantee coverage that the government will provide to lenders will be reduced to 70%.
You can apply for a loan if your business trades in the UK and meets the above eligibility criteria, even if your business received support under the earlier COVID-19 guaranteed loan schemes.
Full details: Recovery Loan Scheme
- Business rates relief
The business rates holiday for early years providers was extended until 30 June 2021, alongside other eligible retail, hospitality and leisure properties. There is now a 66% rate relief until 31 March 2022, with a cap of £105,000 per business for those businesses that were not required to close as of 5 January 2021.
Business rates relief was unfortunately not extended for early years settings as part of the Spending Review 2021, unlike for retail, leisure and hospitality businesses, who recieved a rate cut for 2022/23.
Small businesses, charities and other businesses important to their local community may still be eligible for rates relief, outside of specific Covid-19 measures: Business rates relief
- The Coronavirus Job Retention Scheme
The Coronavirus Job Retention Scheme was financial support for employees who are were working but kept on payroll (furloughed), where the government contributed the majority of each worker’s wages of up to £2,500, backdated to 1 March 2020.
This scheme ended on 30 September 2021.
- Self-employment Income Support Scheme
The Self-employment Income Support Scheme (SEISS) was financial support for those who are self-employed or members of a partnership and had lost income due to Covid-19.
The scheme allowed individuals to claim a taxable grant worth 80% of trading profits up to a maximum of £2,500 per month for 3 months.
This scheme ended on 30 September 2021.
- Other support
Tax rates: Corporation tax will rise to 25% from 19% from April 2023 on profits over £250,000. However, this will not apply to businesses with profits less than £50,000 and there will be additional relief for businesses with profits under £250,000. From 2022, the personal income tax allowance of £12,570 will be frozen until 2026, rather than rising in line with inflation.
Support to create job placements: Kickstart Scheme The Kickstart Scheme gives business owners financial support to create new 6-month job placements for young people who are currently on Universal Credit and at risk of long-term unemployment. The scheme is open to all organisations. Check if you can apply for a Kickstart Grant
For further information on what support may be available to you please see: Financial Support
Early entitlement funding in 2022
The Department for Education has confirmed that during the autumn term 2022, funding will be based on termly attendance counts. They have also published specific guidance for the Early Years Census 2022 in light of the impact of Covid-19. A summary is available here.
The full guidance on the census can be accessed here.
How do I deal with staff who cannot or choose not to attend work?
As early years settings have been able to remain open to all families since 1 June 2021, there is no change to the expectation that staff attend work on their normal scheduled shifts and observe all the protocols settings have in place. These include social distancing between staff and between staff and parents, sanitisation of equipment, surfaces and rooms and hand hygiene, and are all in place to minimise the risk of contracting or transmitting Covid-19.
However, there may be situations where staff must not attend the workplace, cannot attend the workplace or are choosing not to attend the workplace and how those absences are treated will depend upon the reasons behind them.
Further guidance on how to deal with these staff absences can be found here. Alliance members can also receive free legal advice from the Law-Call helpline; details of which can be found within the members’ area.
If parents' income changes due to the impact of Covid-19, are they still eligible for the 30 hours entitlement?
Due to the changes in income levels families experienced as a result of pandemic schemes such as furlough, parents who were normally eligible for the government’s childcare offers continued receiving the entitlements if their income level fell because of the impact of coronavirus up until 31 October 2021.
The government has confirmed that this arrangement was tied to government coronavirus support schemes, for example CJRS and SEISS, and therefore ended on 31 October when the job retention scheme was withdrawn.
Our FAQs are not an exhaustive list of points for consideration. This is an moving situation for providers and the wider sector. For this reason, you should seek legal advice (Alliance members can access free legal advice as part of their membership, contact details are available in the members’ area).
We are also seeking further clarification from the DfE on a number of areas to ensure we are completely clear about implications for employers and employees. We will continually update these FAQs on our website as new information or further guidance is made available.
While many employers will be pragmatic, we know that they will work hard to protect the interests of their employees.
Any employer should be aware that if they fail to follow employment law requirements, their actions could potentially result in employment claims.
A series of general FAQs on operating your early years business during the Covid-19 pandemic are accessible here.
Government financial support