Welsh Government plans to end the disparity in childcare funding

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Wales is to pilot a programme to align funding for providers delivering the country’s two childcare offers.

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A pilot in the spring will see childcare providers in Wales receive the same rate for both childcare offers

Currently, early years settings receive different rates to deliver the Foundation Phase offer of 10 hours a week and the subsequent 20 hours under the Childcare Offer.

Childcare providers receive a flat rate of £4.50 per hour per child for the Childcare Offer and an average of £3.13 per hour for delivery of the Foundation Phase. Funding rates for the Foundation Phase vary by local authority.

The Childcare Offer is currently available to eligible parents within 16 local authorities. From April 2019, the Offer will be rolled out across all areas in Wales.

According to the National Day Nurseries Association (NDNA) Cymru, which has campaigned for equal funding rates for years, in some cases, providers are receiving half that of the Childcare Offer for delivery of the Foundation Phase.

The pilot programme to test the funding alignment will run across Flintshire in partnership with Flintshire County Council during the spring and summer terms.

The pilot will be evaluated and a report with the findings published in the winter.

According to the NDNA, because of the current disparity between funding rates some providers cannot offer the Foundation Phase, which means that children are ‘shunted’ between settings to receive all their funded hours.

A written statement from the Welsh Government states, 'Early implementation of the Childcare Offer has highlighted differences between the funding rate paid by local authorities to providers for early years Foundation Phase education and Welsh Government funded childcare. This reinforced findings of the National Day Nurseries Association's Annual Survey.

'We have listened to the concerns. It is important that we understand the potential impact that a different funding rate will have on the future of Foundation Phase education, and also on the implementation of the Childcare Offer.

'We therefore intend to run a pilot project to test the impact of a consistent funding rate for early education and childcare.'

Purnima Tanuku, chief executive of the NDNA, said, ‘This is really great news and shows that the Welsh Government continues to listen to us and the sector. They know that private nurseries are a crucial part of the childcare and early education provision across the country, offering quality and flexibility for working families.

‘NDNA Cymru has raised this issue for years with the Government, but in our last survey we highlighted it as a significant concern for nurseries. Many nurseries have been forced to increase their fees, meaning parents of younger children end up paying the shortfall in funding. It also results in low pay for the skilled, dedicated workforce.

'We have seen parents juggling Foundation Phase and Childcare Offer hours between different providers as delivering both hasn’t always been sustainable. This announcement should make it easier for children to have a more stable early years experience with nurseries able to cater for families who want to keep children in one setting for both elements.’

Sandra Welsby, NDNA’s national manager for Wales, said, 'This has been a long time coming but very welcome news. We will monitor this pilot closely with our members and the Welsh Government and look forward to their evaluation report later this year.

‘Alongside 100 per cent business rate relief for nurseries from April, this announcement shows how much the Welsh Government values early years providers and is finding ways to address the sustainability concerns within the sector.’

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