Why Charging Per Session and Claiming Childcare Offer Funding Don't Usually Mix (And How We Fixed It)

Why Charging Per Session and Claiming Childcare Offer Funding Don't Usually Mix

A Cylch Meithrin we work with got in touch with a question that sounded simple: they charge by the session, not by the hour, and they wanted to know whether Childcare Offer Wales funding could come off their session price rather than the other way round. It turned into one of the more interesting problems we've untangled this year, so it felt worth writing up, because we don't think this Cylch is alone in hitting it.

The pricing they'd actually built

Like a lot of settings, they don't price by the hour. An afternoon session, 11am to 5:30pm, is £47.50. That's the price. It's not meant to be divided up and recalculated depending on who's paying for which hour of it.

What Childcare Offer funding did to it

Here's the part that's easy to miss. Childcare Offer Wales gives eligible children up to 30 hours a week, paid at a set government rate. Most childcare software, including ours until recently, deals with that by throwing your session price away completely once any of it is funded. It looks at the day, works out how many hours are covered by the funding and how many aren't, and prices each of those separately by the hour: funded hours at the government rate, the rest at your own hourly rate. Your actual session price is never used.

If you already charge by the hour, that's not a problem, it's just how the maths works. But if you charge £47.50 for a session, it's a real one, and it shows up in an odd way. A child's 30 funded hours run out partway through the week, so the exact same £47.50 session ends up costing three different amounts depending on which day it falls on. Early in the week, while the funding's still there, it's fully covered. By Thursday only part of it is left, so the parent pays for the rest. By Friday the funding's gone, so the parent pays the lot. Three different figures, on three different days, for the identical session, and none of them is £47.50.

It wasn't just one setting, and it wasn't just a display problem

Once we started looking, we found it wasn't just the one Cylch who'd asked. Every setting on Wootzoo using session pricing alongside Childcare Offer funding had the same thing happening. And it wasn't just an odd-looking number on screen, it was real money. Because the hourly rate being substituted in didn't match what the session actually cost per hour, parents were quietly being charged less than their own session prices said they should be. On one setting, that came to around £110 a month for every funded child. Across a term, across several children, that adds up fast.

How we fixed it

The fix is simple to say, even if it took a bit of work to build. Your session keeps its own price. The funding then comes straight off that price, not off some separate hourly figure that has nothing to do with what you actually charge. It can never take off more than the session costs, so a parent is never left with a negative amount. And because it's your price staying fixed, the same session costs the same every day, whatever day of the week the funding runs out.

You don't have to change how you're set up now to get this. It's a switch you turn on when you're ready, not something we've forced on everyone, because some settings do want their funding worked out by the hour, and we didn't want to change anyone's invoices without them choosing to.

Worth checking if this is you

If your setting charges by the session and you're claiming Childcare Offer funding, it's worth checking your invoices actually add back up to your own price list. It's an easy thing to miss, because the maths still produces a plausible-looking number, it just isn't yours.