It is hoped that the proposals, out for public consultation, will boost ‘high quality, flexible early learning and childcare which is affordable and accessible for all’.
Critics of the current system claim many parents are restricted to half-day funded sessions which do not fit in around their working lives.
Councils also decide what childcare places are offered to parents, and it is hoped proposals to tie funding to each eligible child will also improve access.
Scotland’s First Minister Nicola Sturgeon outlined the key proposals of the Early Learning and Childcare Policy Blueprint in her keynote speech to the Scottish National Party conference at the weekend.
Ms Sturgeon said, ‘Firstly we will propose that parents can choose a nursery or childminder that best suits their needs and – as long as the provider meets agreed standards – ask the local authority to fund it.
‘In other words, the funding will follow the child, not the other way round.
‘Second, as suggested by Children in Scotland’s Childcare Commission, we will propose that parents can opt to receive funding in a childcare account and then use it to purchase a suitable place directly.’
Carolyn Lochhead, a parent and volunteer with the Fair Funding for our Kids campaign in Scotland, said the group was ‘glad to see that the Scottish Government is considering this option’.
But Ms Lochhead warned that an unintended consequence may be that funding is diverted away from state provision into the private sector.
Most of Scotland’s provision is at present concentrated in the state sector, where the free places are only offered in limited sessions, unlike the private sector.
Working parents find this a challenge as their children have to be picked up part way through the day to continue their care elsewhere.
As a result, some women are driven to give up their jobs.
Times are more flexible in private settings, meaning with improved choice, working parents may opt for them over state provision, which tends to be found in less well-off locations.
‘We need to make sure it doesn't unintentionally lead to a loss of provision in more deprived areas,’ added Ms Lochhead.
‘And we still need to fix the problems facing today's three- five-year-olds.
‘Two-thirds of nursery places are currently provided on a half day basis, so many working parents can't make use of them.’
The National Day Nurseries Association (NDNA) said it had been promoting such reforms for many years, which it described as ‘revolutionary’.
Chief executive Purnima Tanuku said, ‘This is fantastic news and is something we have campaigned for since funded childcare was introduced.
‘Nicola Sturgeon’s speech echoed NDNA’s messages on funding following the child and our suggestion to the Commission for Childcare Reform of an online childcare account for parents to use. This will give parents true choice and reduce administration costs for nurseries.
‘As highlighted in our Annual Survey earlier this year, many parents currently have to move their settled children from private and third sector nurseries because some local authorities restrict the number of funded places they can offer.
'These reforms will address the need to move children from one setting to another, giving parents real choice and encouraging more nurseries to become partner providers to their local authority.
‘We congratulate the Scottish Government for taking these revolutionary ideas on board and look forward to working with Government to make it a reality.’
The NDNA called for adequate investment for fair funding rates for nurseries and more attractive salaries.
Scottish nurseries currently receive the lowest funding in the UK at £3.56 per hour, which equates to an average annual shortfall of £39,480 per nursery, according to the association.
Ms Tanuku added, ‘We welcome the Government’s acknowledgement that low levels of funding are directly linked to low wages within the sector which threatens quality and sustainability of private businesses.
‘Private and third sector nurseries offer flexibility and are crucial to the delivery of 1140 free hours for parents, but must be encouraged to thrive.
'We welcome these plans to invest in skills, but funding must be at a level to at least enable staff to be paid the Living Wage.
'It currently falls far below that and nurseries can no longer thrive with such a hole in their finances.’
- Consultation responses are invited by 9 January 2017.