The Early Years Single Funding Formula - Children, Schools and Families Committee Contents

1  Introduction

1. In its ten-year strategy for childcare, published in 2004, the Government spoke of its vision of a system in which childcare was available to all families and was flexible to meet their circumstances; in which the quality of childcare services was among the best in the world; and in which all families could afford high quality childcare services that were appropriate for their needs.[1] One of the routes by which the Government has sought to achieve these aims is the introduction of an entitlement to a level of free early education and care for three and four year olds.

2. The Government regards local authorities as being instrumental in developing the availability, flexibility and quality of early years education and care. £4 billion is spent by local authorities each year on children under five.[2] The Childcare Act 2006 placed new duties upon local authorities to reduce inequalities between young children, secure provision of free childcare under the entitlement, assess childcare provision in their areas, and ensure that there is enough childcare locally to enable parents to work (or to enable them to undertake training which could be expected to lead to work).[3] 'Childcare' in this context includes education for children below compulsory school age.

3. In March 2007, in a consultation paper on the reform of school funding, the Government put forward proposals designed to bring the funding systems for different sectors of early years provision "into closer alignment to enable local authorities to shape the market in response to parental demand".[4] One of the outcomes was a decision to introduce an Early Years Single Funding Formula"a standardised, transparent method for setting the basic unit of funding per pupil",[5] to be adapted and applied by each individual local authority to fund the entitlement to free early years education and care at early years settings.[6] The date by which each local authority in England was to introduce its funding formula was to be April 2010.

4. In the summer of 2009, we became aware of alarm among providers of early years education and care about possible consequences of both an imminent extension of the entitlement to free early education and care and the proposed new single funding formulae being developed by local authorities. We therefore held a short inquiry, taking oral evidence from providers and their representative bodies, local authorities, and the Minister for Children, Young People and Families. We also invited written evidence and were struck by the amount received despite the four-week deadline for submission. Almost all evidence specially prepared for the Committee has been placed on the Parliamentary website.[7] We are grateful to Dame Gillian Pugh and to Professor Christine Pascal for their specialist advice.[8]

1   Choice for parents, the best start for children: a ten year strategy for childcare, HM Treasury, December 2004, paragraph 1.10 Back

2   Draft Code of Practice on Provision of the Free Early Education Entitlement for 3 and 4 year olds, DCSF, September 2009, paragraph 1.1 Back

3   Childcare Act 2006, sections 1, 6, 7 and 11 Back

4   School, early years and 14-16 funding consultation, DCSF, March 2007, introduction to Chapter 5 Back

5   HC Deb, 25 June 2007, col. 1WS Back

6   "Setting" is a generic word for any institution (such as a school, playgroup, nursery or accredited childminder network) where early years education and care is provided. Back

7 Back

8   Dame Gillian Pugh declared interests as Chair of the National Children's Bureau, Board member of the Training and Development Agency for Schools, Adviser to various sections of the Department for Children, Schools and Families, member of the Children's Workforce Development Council, visiting professor at the Institute of Education, President of the National Childminding Association, and member of the DCSF/LGA Narrowing the Gap project. Professor Christine Pascal declared interests as Director of the Centre for Research in Early Childhood and Director of Amber Publications and Training Back

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