The Department for Education says around 25 per cent of councils will receive less funding as a result of proposed changes to early years funding.
As part of efforts to improve the early years funding system and give frontline providers a fairer deal, the government says it will introduce a new early years national funding formula from next April.
The proposed changes are to prepare for the extension of free childcare provision for three- and four-year-olds from the current 15 hours a week to 30 hours a week from September 2017.
Providers will need to deliver enough free childcare places to meet the needs of nearly 400,000 families who will be eligible, but there are concerns many providers will not get involved because of low funding levels.
Under the proposed formula, councils will receive a base rate for each childcare place making up 89.5 per cent of the total. The remainder will be based on the proportion of children in the area with additional needs. There will also be an “area cost adjustment” to reflect cost differences between local areas, such as staff costs.
Consultation documents published by the Department for Education show that the new formula will mean that 112 local authorities (73.7 per cent) stand to receive more cash, with 38 (25 per cent) set to face reductions.
Councils will also be expected to pass on more of the money they receive from central government to frontline childcare providers.
Click here for the article from Children and Young People Now.