A nursery praised for providing high-quality education to toddlers is closing because of a funding crisis.

Littlehampton Community School Nursery has been running since 1992 and provides places for 51 children next to the school in Elm Grove Road.

The nursery's last Ofsted report in 2004, said the school was very good at fostering personal, physical and creative development, knowledge and understanding of the world, language and literacy.

It said: "The provision is acceptable and is of high quality. Children are making very good progress towards the early learning goals."

But West Sussex County Council has been forced to bail the privately-run business out for three years because of a lack of pupils.

Other nurseries offer cheaper early years education and the nursery is only 68 per cent full.

Last year the county handed over subsidies of £64,388 and now the nursery needs to repair the roof, which will cost about £30,000.

Colin James, the county's deputy director of education, said: "We had to hand over more than £60,000 last year and it's money from the tax-payer."

Letters have been sent to parents saying that unless extra funding can be secured the nursery will close on December 31.

Joint manager Liz Board said the nursery employs 13 staff and uses supply teachers, all from Littlehampton. She said: "Obviously the staff are very upset about it, as are the parents.

"Some of the staff have been here for a long time.

"We have parents who have sent successive children to this school so they are very disappointed too."

She said the nursery had struggled since a SureStart nursery opened in Wick, near Littlehampton.

She said: "If someone comes in with a business plan to make the nursery viable again, the county council has said it will listen to it."

Councillor Mark Dunn, in charge of the county's education policies, said: "We simply cannot support this kind of deficit in the future.

"However, we are confident that alternative childcare placements can be found."

Jayne Wilson, headteacher at Littlehampton Community School, said: "The school has been working on behalf of nursery staff for several years to find ways of making it a viable unit. Regrettably it seems there is no solution."