Mary Davies, owner of Aintree Day Nursery, told Nursery World she had to obtain a £10,000 overdraft facility last month in order to pay her staff. She is owed £4,500.
'Five years ago this was not happening, but now, for some people we seem to come somewhere below the cat litter in their list of priorities,' said Ms Davies.
She called on the Government to channel money for childcare direct to providers and rejected the Government's claim that the present system was facilitating parental choice. She said non-payment had become a 'scam' encouraged by the way parents receive tax credits towards the cost of childcare.
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