The Government has today published a list of the successful bidders.
The Department for Education has estimated that the funding for these capital projects will create nearly 9,000 more funded places for three-and four-year-olds when the free entitlement rises from 15 to 30 hours in September, saving parents around £5,000 a year in childcare costs.
The Government said its priority was to target the grants in areas where there was evidence of the need for extra childcare places to support the delivery of 30 hours of free childcare to parents.
Local authorities bidding for funding were required to contribute at least 25 per cent of the amount they requested, so that the budget could be shared around as many projects as possible.
Education secretary Justine Greening said, ‘We want Britain to be a country that works for everyone, not just the privileged few. That means removing the barriers facing parents who are struggling to balance their jobs with the cost of childcare, and spreading the opportunities available to hardworking families across the country.
‘This funding, backed by our record £6 billion investment in childcare per year by 2020, means we can make more free places available to more families across the country, helping us to deliver our childcare offer to thousands more children.’
More than £2m will be invested in six areas identified as social mobility ‘cold spots’ and earmarked by the education secretary as the first Opportunity Areas.
Blackpool, Derby, Norwich, Oldham, Scarborough and West Somerset will be awarded the extra funding.
Announced by the education secretary last October, Opportunity Areas will involve local partnerships formed with early years providers, schools, colleges, universities, businesses, charities and local authorities to ensure all children have the opportunity to reach their full potential.
These areas will also be able to access wider support to help children and young people from nursery to work, including a £75m teaching and leadership innovation fund.
Purnima Tanuku, chief executive of the National Day Nurseries Association said, 'The Government has recognised the important role played by private, voluntary and independent nurseries in its announcement of capital funding projects, with the largest proportion of the award money supporting this sector.
'We are heartened that ministers are announcing this capital investment in a project which is bound to be extremely popular with families across the country.'
But she added that capital funding was only part of the solution.
'Details of exactly how much money local authorities will be giving to providers per hour for these funded places are still unknown.
'Our concerns about whether most nurseries can offer 30 hours of funded childcare to their parents and remain sustainable as businesses are still very much fundamental to the success of this policy. Our members who are facing increasing business burdens also need reassurance that they can charge parents for "extras" over and above the funded childcare place, such as meals, which is not funded with the Government hourly rate.'
Neil Leitch, chief executive of the Pre-school Learning Alliance, said that while the announcement would undoubtedly be welcomed by the 200 providers benefiting from the extra funding tens of thousands of nurseries, pre-schools and childminders would still face challenges, highlighting the need for more capacity in the sector and greater investment.
'With many providers warning that they will need to reduce the number of places they offer in order to deliver the 30-hour scheme, it's clear that the Government is going to have a real capacity problem on its hands when the offer rolls out in September. Creating an additional 9,000 places in a sector that already delivers just under 1.3 million represents an increase of just 0.7 per cent - a drop in the ocean compared to what is needed.
'If the 30-hour scheme is to have any chance of succeeding, the Government must invest what is needed - both in terms of creating capacity for new places and ensuring that the delivery of existing places is funded at a fair and sustainable rate over the long-term. Anything less, and those parents who have been promised additional "free childcare" from September are going to be left very disappointed."
James Hempsall, national programme director for Childcare Works, which has the Government contract to support settings and councils to implement the 30-hours policy, said, ‘Local areas and providers have told us of their amazing plans to develop new places to meet demand.
‘This funding will make a tremendous difference to very many of those projects. It is essential that childcare places are where parents need them – such as in rural settings, areas of low supply, and at times when parents are working.
‘We’re delighted to see the energy, creativity and positivity around 30-hours. Childcare Works are ready to work with these grant recipients and other providers to be ready for September 2017.’
Childcare Works is a partnership between childcare consultancy Hempsall’s, the management consultancy Mott McDonald and the charity Action for Children.
Sue Robb, head of early years at Action for Children, said, 'I welcome this announcement, in particular it is helpful that a set proportion of this new money to create places or extend existing settings is aimed at the PVI sector, where there is a real need. This money will support the roll out of the 30-hours childcare scheme, helping parents to get the best quality services available for their needs.'
Commenting on the scheme, Tulip Siddiq MP, Labour’s shadow early years minister, said, 'Any additional funding is welcome but this is woefully short of what is needed to deliver the Government’s underfunded childcare plans.
'The Tories still have no strategy to raise the quality of childcare or ensure the sustainability of childcare providers, who are struggling to deliver their underfunded 30 free hours promise.
'The Tory record on childcare is one of fewer Sure Start centres, rising childcare costs and parents waiting for much needed support. They are failing hardworking families and it’s our children and the economy that will pay the price.'