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Government announces early years funding rates for 2018/19

By Shannon Hawthorne

The government has announced the early years funding rates for 2018/19, revealing that most local authorities will not receive any additional funding next year.
The new figures also reveal that 14% of local authorities will actually see a reduction in the level of funding.
Operational guidance
The government has also released an updated version of its operational guidance for providers, confirming that local authorities must increase the amount of funding they pass on to providers from 93% to 95% in 2018/19.
The guidance also reiterates that local authorities should not distinguish between the first and second 15 hours of childcare entitlement.
Sustainability concerns
Neil Leitch, chief executive of the Alliance, said that the new funding rates demonstrated why so many providers are worried about their long-term sustainability.
Neil said: “Despite the fact that we are seeing staff wages, rents and mortgages, insurance costs and business rates all increase, the vast majority of local authorities in England won’t receive a penny more in government funding for the so-called free entitlement next year. Worse still, 14% of councils will actually see a fall in funding.”
“We have long warned that if funding rates don’t increase in line with rising early years delivery costs, more and more nurseries, pre-schools and childminders are going to be forced out of business. The vast majority of childcare providers in this country support the idea of free childcare in theory, but they cannot be expected to deliver it if they are suffering a real-term loss in funding year after year,” Neil added.
Fair funding
Earlier this year, a survey conducted by the Alliance revealved that 49% of childcare providers were worried that they could close as a result of the funding.
The Alliance is calling for providers and parents to join its Fair Future Funding campaign, which asks the Department for Education to review the current funding rates.
More than 5,000 people have joined the campaign already – add your voice here.
Find out more