Nursery schools could soon “disappear” because of funding cuts, a new report has warned.

Dozens of the schools that cater for three- to five-year-olds have closed over the last decade, and more could follow as cash-strapped local authorities are forced to make savings, according to early years campaigning group and charity Early Education.

“Without urgent action, nursery schools will soon disappear,” the report states. “Once lost, the cost of rebuilding an equivalent reservoir of expertise in early years education would be prohibitive.

“We are allowing our finest early years provision to be lost in the interests of short-term cost savings.”

There were 414 maintained nursery schools in England in January 2014, according to Department for Education statistics - down from 475 in 2003. Early Education estimates that, over the last year, the number has dropped to 408, 14 per cent fewer than in 2003.

The schools are not part of the statutory education system and the number varies between local authorities: Birmingham has the most with 26, but there are 49 authorities with none at all.

They tend to be concentrated in disadvantaged areas. According to Ofsted, 96 per cent of nursery schools are good or outstanding, compared with 81 per cent of all schools.

The report points out that although local authorities can fund nursery schools at a different rate from other types of provision, they are not required to do so.

Beatrice Merrick, chief executive of Early Education, said: “Nursery schools do not have a level playing field. There is an idea that early years provision can be funded at the same level regardless of whether the staff have level 3 qualifications or are qualified teachers. It should be self-evident that if you have teachers and a headteacher they should be paid more.”

She added that, due to growing fears about the future of nursery schools, recruiting headteachers in the sector was becoming increasingly difficult. In turn this could lead to more of them being amalgamated into primary schools or federations, Ms Merrick warned.

The report recommends that urgent action is taken to stabilise funding at a sufficient level to cover staffing costs, and that nursery schools are able to become academies or cooperative trusts.

The report comes 15 months after the Commons Education Select Committee called on the DfE to set out a strategy for ensuring the survival of maintained nursery schools.

During a parliamentary debate in September 2014, Sam Gyimah, the minister responsible for early years, argued that although nursery shcools had a role to play, the government supported “diversity of provision in the sector”.

Responding to the report, a DfE spokesperson said: “Maintained nursery schools are a vital part of our diverse range of early years provision that offers parents real choice and flexibility.

“They are funded in the same way as every other early education provider. Funding levels are decided by councils, who should always factor in running costs and local need.

“It is wrong to say a significant number have closed - since 2010 numbers have fallen by only 14 to 414 and often this has been as a result of mergers.”

Related stories:

Childcare minister calls for more primaries to offer nursery places - 21 October, 2014

Early -years pupil premium plans unveiled by government - 18 March, 2014

Protect children’s centres and nursery schools, says damning report - 17 December, 2013