Childminders more upbeat than nurseries over funding formula

Since the release of the Department for Education’s publication of the new Early Years National Funding Formula, many Early Years settings have raised concern. However there are indications that childminders may be a great deal happier than nurseries.

Research carried out by charity PACEY has suggested that the newly introduced floor rate is close to the fees that childminders currently charge. A survey of 1,700 childminders, carried out this year, revealed that more than two thirds of childminders charged £4.50 or under an hour. 

The Government’s decision to introduce a new minimum rate of £4.30 means that local authorities have the scope to pay providers an average funding rate of at least £4 per hour, for those providers offering the full 30 hours from September 2017.

Many nurseries will also see a rise in their business costs with the National Living Wage increasing too; however childminders usually have much lower costs to run their setting. It has been suggested that with the lack of funding received against the cost of running a nursery increasing, 2017 may see a number of Early Years setting unable to continue.

Both the NDNA and Pre-school Learning Alliance have welcomed more funding, but say it does not go far enough. This is despite an extra £30m being found in the Department’s budget to support this new minimum rate.

To add to the concerns of early years providers and sector organisations – a debate in the House of Lords last week revealed that the rate for early years funding will not be reviewed annually.