Not all councils following government childcare funding guidance, leaving providers out of pocket

Some childcare providers such as nurseries are not receiving the recommended funding via local councils according to the Early Years Alliance. Credit: Getty.
Some childcare providers such as nurseries are not receiving the recommended funding via local councils according to the Early Years Alliance. Credit: Getty.

At least 20 local authorities in England are not funding childcare providers in line with government coronavirus guidance, according to an investigation by the Early Years Alliance.

The Department for Education (DfE) is providing early years funding to all councils in England based on the number of children who were attending childcare settings last year. This is to protect nurseries who were forced to close during lockdown or have lost significant numbers due to more parents working from home.

The government has pledged to “block-buy” these childcare places until the end of 2020 regardless of how many children are attending childcare.

Under current DfE guidance, councils are expected to take the same approach and fund nurseries, preschools and childminders to “broadly the levels they would have expected to see in the 2020 autumn term had there been no coronavirus outbreak.”

But in recent weeks, the Alliance has received a number of reports from childcare providers complaining that councils are not adhering to this guidance.

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In response, the Alliance filed a Freedom of Information request to every local authority in England, asking if they were basing the funding being given to early years providers this term on child attendance numbers from last year, as stated in the DfE guidance.

Of the 120 councils who responded, 17% stated they were not following this guidance. A further 6% said they were only following the guidance in some circumstances, such as funding nurseries and pre-schools based on last year’s childcare attendance numbers, but not childminders. And 3% were still yet to decide.

Neil Leitch, chief executive of Early Years Alliance, said: “It is simply unacceptable that so many local authorities have disregarded the DfE guidance on early years funding during this critical time — and more importantly, that they have been allowed to do so.”

He added: “We have been contacted by many providers who had budgeted and planned on the basis of the government’s reassurances that their funding for the autumn term wouldn’t be affected by the pandemic, only to find out at the last minute that this isn’t the case. For many, this could be the difference between surviving the next few months, and being forced to close their doors.”

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A spokesperson for the Local Government Association said some councils may decide to distribute funds differently by supporting those who are struggling the most following the lockdown, or providing additional support for children with special educational needs and disabilities.

But they admitted funding rates for early entitlements were insufficient and left many providers in a precarious financial position even before the pandemic.

“We are calling on the government to use the forthcoming spending review to fully fund the early entitlements, and to provide an urgent injection of funding to support those providers most at risk of failure due to the pandemic,” the spokesperson added.

A Department for Education spokesperson said local authorities had a legal duty to ensure a sufficient number of childcare places in their area and their guidance made clear how local authorities should fund early years entitlement places during the COVID-19 outbreak.

“Local authorities should only take a different approach from that set out in guidance if they have good reasons for doing so and communicate this clearly to their providers. We are in regular contact with authorities to remind them of this and query any funding approaches where there is a concern.”

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