Nursery school quality and levels of service tend to reflect the prevailing income levels in their areas. High-quality nursery schools operate in affluent neighborhoods, while in areas with serious social problems, both quality and quantity of care suffer. That is the conclusion drawn by research conducted recently by the Greek Society for Local Development and Government (EETAA) on behalf of the Central Union of Municipalities (KEDKE) into the state of municipal nursery schools in view of the upcoming budget when the amount of funding and manner of allocation are to be decided. Major discrepancies The study found that although the 1,346 municipal nursery schools have improved their services since local government assumed responsibility for them, there are still major discrepancies in the services offered and the cost borne by users. For example, the study showed that in some nursery schools staff actually outnumber children, while in others the staff-child ratio is 1:30 or even 1:35, and there are three fully staffed nursery schools that have no children at all. There are corresponding discrepancies in running costs. The average cost at some nursery schools exceeds 10,000 euros per child per annum, while at others it is only around 2,300 euros. What emerges clearly from the study is that the majority of nursery schools do not operate on a rational basis, which raises or lowers the cost regardless of the quality of services provided, which also varies. The researchers found that the average teacher-child ratio was 1:16 while the average auxiliary staff-child ratio was 1:20, figures which are not far from the official specifications. However, nursery schools typically lack staff or are overstaffed. The three that had no children receive income from grants. The 1,346 nursery schools employ 6,336 workers and serve 63,050 children. Of the workers, 57 percent are teaching staff. Yet 25 percent of nursery schools have seen staff numbers decrease by around 9 percent in recent years, which has had an immediate impact on services offered. The model on which the schools operate is illogical: Child numbers have decreased by about 50 percent, without any changes being made in the way they operate, while in the 25 percent of schools where staff numbers have dropped, the number of children has increased. The fact that 57 percent of the buildings were found to be suitable for nursery schools naturally raises the question of whether the rest might be unsuitable. Operating hours were deemed to be satisfactory, with 49 percent open more than nine hours a day, but 25 percent were open for less than eight hours a day. State funds The basic source of funds for municipal nursery schools is the state, followed by municipalities themselves. About 10 percent of total income for nursery schools comes from contributions made by users, since many of them – about 500 out of 1,346 – have not established fees. This seems positive, but the fact that users do not contribute to running costs stops both nursery schools from improving their services and municipalities from implementing a redistribution policy by offering their services at little or no cost to families who are unable to pay. The outcome of this illogical model is a widely divergent running cost per child. Although the average appears to be around 2,550 euros, there are nursery schools where the cost is 2,200 euros and others (about 4 percent) where the cost per child rises to 10,754 euros. Of that expenditure, the lion’s share is absorbed by fixed expenses (wages and rent), which on average are 1,860 euros per child. Subsidies display similar discrepancies. Some municipalities subsidize at the rate of 5,000 euros per child, while others pay out less than 1,000 euros per child. Given the illogical manner in which they operate, 330 nursery schools managed to have a budget surplus while 140 had deficits. KEDKE is attempting to tackle the situation depicted in the study in light of the coming state budget, but it is hamstrung by the fact that subsidies for 2005 have been frozen at 2004 levels.