Dutch childcare institutions fear new bankruptcy crisis: report

For the first time in years the number of kids attending childcare institutions in the Netherlands is increasing. But childcare institutions themselves are still worried. They fear that a new law with stricter requirements will lead to a new wave of bankruptcies, Saskia Speelman of the interest group for the childcare sector said to AD.

Last year the government paid childcare allowance for 823 thousand kids, according to figures Statistics Netherlands released on Thursday. That is a massive increase compared to the 764 thousand kids who attended childcare in 2015.

According to Speelman, the increase in kids attending daycare, kindergarten and other forms of childcare is a direct consequence of a reduction in the parental contribution. In the previous years, the amount parents had to contribute increased, leading to a drop in the number of children in childcare and hundreds of bankruptcies in the sector between 2011 and 2015.

Now that the number of kids is increasing again, the sector is worried about a new blow - the implementation of the Innovation and Quality Childcare Act. This new law was recently adopted by the Eerste Kamer, the Dutch Senate.

"The new figures are no reason to be optimistic', Speelman said to AD. "Just now that many organizations managed to get their head back above water, we get a new blow. And if nothing changes, many organizations will go under."

The new law states that childcare institutions must have a pedagogical employee for every three babies. Currently it is one for four babies. There must also be two fixed faces per group, instead of the current three. "The intentions of the new law are good, but the changes are resulting in massive extra costs", Speelman said "Most companies will have to pass these on to the parents, because they've eaten through their reserves completely over the past years. Higher costs mean that more parents will take their child out of childcare. And companies that just managed to survive the past crisis, will topple. We are very worried."

Minister Lodewijk Asscher of Social Affairs and Employment is aware of the childcare workers' concerns and is taking them seriously, a spokesperson said to AD. "The minister will monitor the effects in practice. Should it prove that the effects are greater than anticipated, hew will inform the Kamer of possible solutions."