In the municipal practice of child day care, constellations in which municipalities do not operate any child day care centres themselves and care in the region is provided entirely by independent youth welfare organisations are not uncommon. Nevertheless, local authorities repeatedly use statutory regulations to set parental contributions and attempt to make these binding for the facilities run by independent providers. Questions therefore regularly arise as to who decides on the contributions charged for attendance and how the relationship between the public-law financing system and the private-law service relationship in child daycare should be organised. The Federal Administrative Court only recently addressed this issue again and has now clarified it: Local authorities can only regulate parental contributions under public law where they themselves are the provider of the facility or where state law expressly grants them the power to do so (Ref.: 5 CN 1.24 of 29.01.2026).

The specific case concerned a joint municipality in Lower Saxony. It used a fee statute to determine the fees that parents had to pay for their children to attend the facilities run by independent providers. The independent providers in turn concluded private-law childcare contracts with the parents and used the municipal parental contribution statutes as a basis.

Some of the parents affected appealed against this with an application for judicial review before the Lüneburg Higher Administrative Court (OVG) - but without success. According to the OVG, the fee statute had no direct legal effect on the parents, as the legal relationship with the independent providers was organised under private law. Therefore, the parents were not authorised to file an application (Ref.: OVG 9 KN 183/19 of 10.01.2024).

The decision of the Federal Administrative Court

The Federal Administrative Court has now contradicted this view in the appeal proceedings. It first clarified that the parents are authorised to file an application. The decisive factor was that, according to its wording and history, the parental contribution statutes also apply to daycare centres run by independent providers and form the de facto and legal basis for the contribution structure in the childcare contracts. Parents are therefore also directly affected by the statutes. 

In the case itself, the court found that there was no statutory authorisation basis in Lower Saxony state law that would allow local authorities to set parental contributions for attendance at daycare centres run by independent providers by means of statutes. Municipal statutes could therefore not bindingly intervene in or determine private-law fee relationships.

„The intervention in the structuring of childcare contracts between independent providers and parents that goes hand in hand with the setting of contributions under statutory law is inadmissible because there is no legal authorisation for this. It is true that public youth welfare organisations are authorised to set cost contributions for the support of children in their own daycare facilities (§ 90 Para. 1 No. 3 SGB VIII). However, this does not extend to independent providers, as the Federal Administrative Court has previously ruled. Lower Saxony state law does not contain any such authorisation either.“ (BVerwG, judgement of 19.01.2026, 5 CN 1.24)

The Federal Administrative Court thus confirms the view it had already taken in 1997 (BVerwG, judgement of 25 April 1997, 5 C 6.96). At that time, the Federal Administrative Court had ruled that public youth welfare organisations were not authorised to set or levy participation fees for attendance at independent daycare facilities. They may (only) decide the extent to which they themselves wish to pay a participation fee and thus the costs of attending an independent day care centre in order to avoid placing too great a financial burden on parents (Section 90 (3) and (4) SGB VIII).

This is because the question of whether the costs are economically reasonable for the parents in individual cases does not yet play a role in determining the contribution in accordance with Section 90 SGB VIII. It only becomes relevant later when a decision is made on whether to waive or cover the contribution by the public youth welfare organisation. The actual determination and collection of contributions from independent organisations is by no means a task of public youth welfare.

Conclusion and outlook

The ruling of the Federal Administrative Court therefore represents a fundamental decision in favour of independent providers and strengthens their statutory autonomy (§ 4 Para. 1 S. 2 SGB VIII) and contractual authority.

This is because, within the framework of partnership-based cooperation between public and independent youth welfare services, care must always be taken to ensure that independent youth welfare services can independently design their organisational structure and pursue their goals and tasks independently. The autonomy of local authority statutes ends where it concerns private service provision and the state legislature has not created any explicit regulations.

The organisation of contributions is now clearly in the hands of the independent providers - subject to state law requirements and in accordance with the ruling of the Federal Administrative Court. At the same time, this increases their responsibility to develop transparent and appropriate contribution models that fulfil the legal requirements and funding specifications. It is to be expected that local authorities and state legislators will react to the judgement and attempt to exert greater influence on parental contributions by introducing new legislation. It remains to be seen whether and how this will actually be implemented.