Financial sustainability health check of the childcare sector: analysis and evidence

The financial sustainability health check has collected evidence on the sustainability of the childcare sector, including the impact of COVID-19, and sets out further actions to be taken. The report sets out the detailed evidence and analysis that has informed the health check.


1. In April 2021 the Scottish Government commenced work on a Financial Sustainable Health Check to assess the impact of COVID-19 on the business sustainability of childcare providers, and to assess the impact of financial support which has been available.

2. The Health Check has been informed by evidence and analysis from:

  • Detailed surveys of childcare providers, with separate surveys for day care of children and childminding services.
  • In-depth case study interviews with a range of providers;
  • In-depth one-to-one discussions with each the provider representative bodies (Care and Learning Alliance, Early Years Scotland, National Day Nurseries Association, Scottish Childminding Association, and the Scottish Out School Care Network (SOSCN); and
  • Analysis of trends in Care Inspectorate registration data.

3. The Health Check has enabled a wide range of rich data and information to be captured, which is set out in this document. Whilst the key findings have been summarised in the Financial Sustainability Health Check of the Childcare Sector in Scotland this paper is intended to provide a resource for readers who wish to explore the underlying evidence and analysis in more detail.

4. Given the range of analysis that is available across different types of services this has meant that the majority of the information is presented in reference tables. We have attempted to make this information as accessible as possible, but appreciate that, particularly for some of the survey analysis, some tables can be dense.

5. As part of this exercise we have also published updated information from all local authorities on: the sustainable rates that they have set for their funded providers in the private, third and childminding sectors; rates paid for the delivery of the free meal commitment; their approach, in-line with guidance published in April 2019, for setting sustainable rates; and any additional support that has been offered to their funded providers during the pandemic.



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