Memorandum submitted by Andy Collishaw, Departmental Finance Manager - Children Services, Darlington Borough Council
I write in response to your inquiry regarding the Early Years Single Funding Formula and I would like to respond direct to the to the two specific questions.
A) * The expected impact of new local funding formulae on providers of early years education and childcare services.
The impact of the new local funding formulae is creating some parity in the
distribution of funding across early years education providers. However
clearly with the introduction of any new formula there are winners and
losers. The introduction of deprivation into the formula especially for
some Private, Voluntary and Independent Nurseries, is causing concern as they
could be faced with providing the same services for less money. Clearly
there is only the same amount of funding to distribute, and if a deprivation
factor is included this in theory will take funding away from the post codes of
the more affluent children and moved to the more deprived children.
However this is causing a problem to PVI settings in the more affluent areas of
With regard to Maintained settings, it brings much more uncertainty into their
budgets. Assistance will be provided to the maintained settings who have
bought into the Schools Finance Support Service. Darlington currently
funds on 50% planned and 50% actual places based on
B) * Difficulties which have been encountered in drawing up new funding formulae, and how they are being overcome.
4. As detailed above a large lump sum is being proposed for the stand alone maintained nurseries. This has caused some very difficult and probing questions especially from PVI settings who have argued that they should also receive a similar lump sum as they are effectively undertaking the same service, providing the same outcomes, they acknowledge the cost of a manager is less than the cost of a head teacher, but also recognise that they have lower ratios than schools.
5. Another difficulty was the recent publication from the DCSF which seems to be back tracking on the ethos of the Early Years Single Funding Formula. It appears that the DCSF initially wanted a single rate across all settings to ensure parity in funding. However the recent publications makes suggestions that funding should not be reducing Maintained Settings budgets. It is almost impossible to ensure that Maintained settings do not get a reduction in funding, introduce parity in the funding of all settings, introduce a deprivation factor, all within existing resources.