Increase Early Years Funding for Pre-Schools.

The Early Years Funding for Pre-Schools and small settings is very low. With low funding it's getting impossible to keep settings going, many are closing, many settings with a good or outstanding status. Everyone wants the childcare status high but how can this be achieved when funding is low.

The Government understands that hard-working parents rely on childcare to help them balance their home and work commitments. We can rightly be proud of our childcare sector. 96% of childcare settings in England are now rated good or outstanding by Ofsted, an increase from 74% in 2012. Ofsted data also shows that the number of childcare places available has remained broadly stable since August 2015.

The Government already provides a significant package of childcare support to parents and carers and over one million children every year are now benefitting from our record investment in early years education entitlements. These include 15 hours of free childcare a week for 3- and 4-year-olds and a further 15 hours a week for 3- and 4-year-olds with working parents, saving families up to £5,000 per child per year, and 15 hours a week of free childcare for disadvantaged 2-year-olds.

We are aware of concerns in the early years sector about market sustainability, which is why last October we announced increases in hourly rates for our early education entitlements for 2020-21.

All local authorities (LAs) have seen an increase of 8p an hour to the hourly funding rates for the 2-year-old entitlement, and the vast majority of areas have seen an increase of 8p an hour for the 3- and 4-year-old entitlement. At the same time, we announced - also for 2020-21 - an increase in the minimum funding floor, meaning no LA can receive less than £4.38 per hour for the 3- and 4-year-old entitlements, and for Maintained Nursery Schools, that their supplementary funding will continue at its current rate for the whole of the 2020-21 financial year. In total, we are planning to spend over £3.6 billion on early education entitlements in 2020-21.

Further, we maximise the funding reaching the front line by requiring local authorities to pass on to providers at least 95% of their government funding for 3- and 4-year-olds.

The Government remains committed to the future of the early years education sector. We continue to monitor the market closely through a range of research projects, including our annual Childcare and Early Years Providers Survey which gives the government robust evidence on the provider market. We are also in regular contact with early years sector stakeholders through meetings and working groups. This will be an important discussion at the next spending review.

Department for Education