'On verge of collapse' Hunt's free childcare plan sparks crisis for nurseries

In the playground of the Sprig Ludens nursery, a little girl tests her waterproofs to the limit as the rain falls and she jumps in a giant muddy puddle.

Another toddler has a look of fierce concentration on his face as he walks across a plank balanced across two tyres; his little pal climbs a nearby tree.

Sprigs - as it's known to its small clients and their grownups - is an incongruous wild island surrounded by a concrete sea of tightly-packed terrace houses and busy artery roads in Streatham, south London. "They do campfires," says parent Dani Powell. "I love it when my son comes home smelling of smoke." But the free-range adventures he has enjoyed here are about to abruptly end. Last week, the charity that runs Sprigs said government funding levels meant it couldn't afford to pay its staff the London living wage, and it would have to close. "It is just heartbreaking," says Powell.

One year on from chancellor Jeremy Hunt's much-vaunted childcare offer in last spring's budget, the early years sector is warning of a deepening crisis, with many more nurseries like Sprigs facing closure as they struggle to balance their books.

The policy - 30 hours of "free" childcare for eligible under-fives by September 2025 - was about getting economically inactive people back into work. Parents, struggling with childcare costs, were overjoyed.