Dozens of nurseries and other early years childcare providers in Croydon have closed since 2015, according to data published by Ofsted.

In Croydon, there were 559 such providers on the register at the end of March 2018, 44 fewer than in March 2015.

The Pre-school Learning Alliance has called for ‘urgent action’ to address a funding crisis it says has left more than 40% of providers in England considering closure next year.

The alliance claims the government has insufficiently funded a new scheme, launched in 2017, which doubled the number of hours of free childcare many three to four-year olds are entitled to per week during term time.

Neil Leitch, chief executive of the alliance, said: "There has never been any such thing as free childcare. It’s subsidised childcare.

"Early Years funding is frozen until 2020, and while our costs go up, we’re just told to make it work."

All three to four-year-olds in England are entitled to 15 hours of free childcare per week during term time.

But since September 2017, parents can claim an additional 15 hours if both they and their partner earn less than £100,000 a year but more than the equivalent of 16 hours at the minimum wage.

The Pre-school Learning Alliance argues that Government funding for the scheme is not enough to cover the costs incurred by providers.

In Croydon, 42 of the 44 providers lost since 2015 were childminders, who care for small numbers of children at a time.

Mr Leitch said: "It’s a difficult job. Why would anyone do it if you're earning peanuts?

"You could work half the hours in Tesco and be better off financially."

Nadhim Zahawi, Minister for Children and Families, said it was "normal in a private market" for providers to join and leave the Ofsted register.

He continued: “We want every child to have the best start in life, and it is great that more than 340,000 children have benefited from a 30 hours place in its first year."

The Government is also supporting new childcare providers by providing grants to reimburse them for some of the costs of setting up their businesses, he added.

Croydon council were approached for comment but did not respond.