Nearly nine in 10 people (87%) said they were likely to introduce or increase fees for optional extras, such as meals, consumables and travel, and around three in five (61%) %) said they were likely to introduce or increase restrictions on early hours. funding of rights can be claimed.

According to the survey, two in five people (40%) said permanent closure of the early years setting was likely. These results come as the government expands funded childcare for working parents in England.

Working parents with children over nine months now have access to 15 hours of funded childcare, ahead of the full rollout of 30 hours per week to all eligible families in September 2025.

But the EYA survey – conducted online between November 5 and 10 – found that 52% of staff are likely to reduce the number of early access places offered at their institution, and 39% are likely to opt out of some or all early access offers. entirely without government support.

In the Budget, the NI rate for employers was increased from 13.8% to 15%, and the salary threshold at which employers start paying tax was lowered from £9,100 to £5,000 per year.

Chancellor Rachel Reeves also announced that the National Living Wage would rise by 6.7% for employees aged 21 or over – from £11.44 an hour to £12.21 – from April.

The charity is calling on the Government to either commit to fully funding NI increases for early years settings or to exempt the sector entirely from the urgent changes.

Neil Leitch, chief executive of the EYA, said: “We are in the midst of the biggest expansion in the history of the early years sector, an expansion which the Government says is vital to helping parents get into work and, therefore, to stimulate the economy.

“It therefore makes absolutely no sense for the Treasury to turn a blind eye to the potential impact of these changes on our sector when it knows full well that inaction will, at best, drive up prices even further for parents and the children. , at worst, push the sector to the brink of collapse.

Among the third of survey respondents who calculated the impact of the NI rise on their provider, the survey suggests the changes will result in additional costs of more than £18,600 per establishment per year on average.

One respondent said: “Our collective increases will exceed £300,000 for the year across our 10 settings. We employ 185 people and care for 2,000 children per week.

“Where does the government think £300,000 will come from? The parents are there. We have no choice but to increase our prices. Another survey respondent said: “(It is) very likely that we will close within 21 to 24 months as it is a loss-making business model. »

Costs were “too high” and financing rates “too low” to stay open, they said. Mr Leitch added: “The financial pressure created by the large increases in the minimum wage announced at the Budget alone would have been a significant source of concern in the sector given that, despite the Government’s claims to the contrary, the funding increases ‘have never truly reflected the need for managers to maintain pay gaps between different staff members when salaries are increased.

“But add to that the huge rise in National Insurance costs – which the Government does not appear to have factored into next year’s early years funding rates at all – and you have a recipe for ‘a total disaster.’

Last week, Education Secretary Bridget Phillipson told MPs in the House of Commons that the government would announce whether early years funding rates for age groups would change to reflect the rise in national insurance. She said: “We will provide further details on funding rates in due course. » Ms Phillipson added that the Government will provide £8.1 billion for early years benefits in 2025/26.