Government introduces new funding formula for early childcare

The government has launched a new funding system for nurseries, preschools and childminders, in a bid to support its 30-hour free childcare policy.

Currently the funding formula is based on how much a local authority has historically needed to cover child care costs.

The new formula is based on a ‘universal base rate’ of funding for each child, an ‘additional needs factor’, and the cost of providing childcare in different parts of the country.The government has argued that the new system would ensure every local area is funded fairly for the core costs of delivering childcare, while providing enough flexibility to cater for additional needs.

Commenting on the launch of the consultation on the new formula, Justine Greening, education secretary, said: “These changes will transform the way we fund early years’ education, creating a fairer system that better provides the affordable, high-quality childcare families deserve.”