A community early childhood centre manager writes ...

Our question is:  Should we first use up our financial reserves before passing any cost increases on to families due to the shortfall in funding we will be receiving from government in 2011?  

Our situation is this: We have built up some reserves, through prudent management and through having had, fortunately, fuller rolls than budgeted for in recent years. We have a non-renewable lease for the land on which we operate and expect to have to move in a few years, so plan to apply the reserves for purchasing new land and the costs of moving our present building and developing the outdoor environment on our new site.  It is proposed to leave those reserves intact to protect future families from the massive costs of moving (i.e. to share the costs of preserving the service equally amongst all the families who have used our services over the years).  

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