The Department for Education acknowledges that the current system is not working and says that the majority of 30-hour places will be provided by the private and voluntary sector, which needs to be incentivised to offer them.
The consultation proposals therefore aim to address the historic disparities in levels of local authority funding that have led to some settings receiving as little as £3.24 and others £9.17 an hour per child.
Childcare providers in each local authority area will receive the same basic rate of funding for every hour of the free entitlements.
The new early years national funding formula that will replace the current system will be made up of three funding factors:
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