Scottish childcare settings in nearly half of local authorities don't know their new funding rate

The findings come from National Day Nurseries Scotland, which put out a Freedom of Information (FOI) request to all Scottish local authorities.

It said that with so many local authorities yet to decide on their funding rates, it makes it impossible for childcare settings to plan ahead.

Within their response, 15 local authorities revealed that they still don't know what rate they will pay early learning and childcare (ELC) providers in their area to deliver funded places from the new academic year, which starts next week.

Just one in five councils have plans to increase funding rates, however of these, only two – Angus and Stirling – plan for rates to keep pace with current inflation.

Four councils confirmed that their hourly rates will remain the same for the next academic year, which NDNA Scotland said means real-term cuts for nurseries to deliver funded places.

Chief executive Purnima Tanuku said they had never seen a picture with this ‘much uncertainty’.

NDNA Scotland put out an FOI request to all Scottish local authorities asking what their ‘sustainable’ rates will be for two-year-olds and three- to-five-year-olds for partner provider nurseries from this month. A total of 27 of the 32 local authorities responded.

Key findings include:

• Seven councils (22 per cent) revealed their rate for the next academic year is higher than last year.
• Four councils reported no change in their funding rate.
• Funding rate increases range from a rise of 4.3 per cent in Aberdeenshire to 17 per cent in Stirling.
• The average increase for two-year-old funding is 8.68 per cent.
• The average increase for funded three-to-five-year-old places is 7.8 per cent.

'With rising costs these rates are nowhere near sustainable'

Tanuku added, ‘Early learning and childcare settings are facing a really challenging time supporting children with their post-pandemic recovery, workforce challenges, and the cost of delivery rising month on month.

‘The responses from councils show that the majority of nurseries and other providers are being expected to deliver the Government’s funded childcare offer without knowing how much they will be getting to do this.

‘With new children joining from next week but many having to wait until next month to know how each child will be funded, makes it impossible to plan ahead. 

‘Some councils have announced rates that are identical to last year, despite these increases in operating costs.

‘With rising costs these rates are nowhere near sustainable, and the sector cannot be expected to deliver places at a loss.’