30 hours and early years funding report

April 2017 marks the introduction of the new Early Years National Funding Formula, with new funding rates coming into effect for providers across the country.

With just five months to go until the introduction of the 30-hour offer, the Pre-school Learning Alliance conducted an online survey of childcare providers between 23 and 30 March 2017 to gather up-to-date information on provider views on both early years funding and the 30-hour offer.

The results paint a worrying picture for the sector, with less than half of providers currently planning to roll out the offer, and a quarter saying that it is "likely" they will close.

Neil Leitch, chief executive of the Pre-school Learning Alliance said: 

"The promise of 30 hours of free childcare was a key part of the Conservative Party's pre-election manifesto and yet these findings show that if the government doesn't address the sector's funding concerns, it's at serious risk of breaking that pledge.

"With so few providers currently committed to delivering the 30-hours, and so many forced to consider limiting places, raising fees or introducing extra charges in order to remain sustainable if they do offer it, many parents expecting easy access to a 'free' 30-hours place in September are likely to be disappointed.

"The Department for Education said that the new National Funding Formula for the early years would address the sector's concerns about funding, but these results show that this simply isn't true. The vast majority of providers predict that offering the 30-hours will hurt them financially, with most saying that their new "improved" rates still don't cover the cost of delivering places and a quarter fearing closure. Worse still, early years funding will be frozen until 2020, meaning that even those providers who can make it work this year are likely to struggle in the years to come. 

"The fact is that the 30-hours offer cannot succeed without adequate investment. Neither parents nor providers should be expected to pay for a promise that government chose to make."

Access the full report: Sector views on early years funding and the 30-hour offer