Nursery schools granted £24m in stop-gap funding

The move has been welcomed by the All-Party Parliamentary Group for Nursery Schools, Nursery and Reception Classes (APPG), which has been lobbying for extra funding for the 400 nursery schools that remain.

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However, the move has been met with dismay by early years organisations representing thousands of private and voluntary nurseries, who have been granted no extra funding in the move.

The APPG said that the extra funding was in response to their argument that nursery schools needed the certainty of funding for the full school year when offering places to children for 2019-20.

Nursery schools have been receiving an extra £55m a year since 2017 when the early years single funding formula was introduced but this was due to end in March 2019.

This stop gap funding, to be announced by the children’s minister at the Manchester School Readiness conference, has been made available through an exceptional agreement with the Treasury.  

The DfE said that the money will be provided to local authorities to enable them to continue funding maintained nursery schools at higher rates to provide certainty for the sector ahead of the spending review.

A long-term funding solution for maintained nursery schools will still have to await the outcome of the spending review, expected to take place in the autumn.

Lucy Powell MP, chair of the APPG, said, ‘This is welcome news from the minister and I congratulate him on securing this down-payment to ensure the future of maintained nursery schools.

‘This funding will ensure that nurseries have places to offer children for the next academic year, giving certainty to nursery heads and confidence to parents.

‘Nursery schools are the jewel in the social mobility crown, closing the gap between disadvantaged children and their better off peers pre-school. This welcome respite about their future sustainability is a good thing. We must now see a firm commitment in the spending review, to ensure that nursery schools have the security and stability they need to grow and thrive in future years.’

Beatrice Merrick, chief executive of Early Education, which has been leading the campaign for a long-term funding solution for maintained nursery schools, said, ‘The minister has clearly been working hard to secure this very welcome continuation of supplementary funding for maintained nursery schools to ensure admissions decisions can be made with a degree of security about funding for the full school year in 2019-20, if not for the full 2020-21 financial year. 

‘We know headteachers, governors and local authorities will still be on tenterhooks for long-term funding solution that allows them to budget for the future – especially for the growing number of maintained nursery schools in deficit, who need to be able to put forward a viable recovery plan, and cannot do so without long-term assurances on funding. 

‘We will continue working with ministers in DfE and the Treasury to make the case for a long-term solution in the context of the spending review.  As ministers clearly recognise, maintained nursery schools are a sound investment for children and families and the early years sector as a whole, and we hope that will be recognised eventually in future funding plans.’

Responding to the announcement, chair of the Local Government Association’s Children and Young People Board, councillor Anntoinette Bramble, said, 'The LGA has been clear all along around the need for additional funding to secure the future of maintained nursery schools and we are pleased the Government has acted on our concerns.

‘Maintained nurseries provide a high level of support to disadvantaged children and those with special educational needs, and it is important that they continue to receive funding to do so.

‘However, while this extra money will provide much needed clarity to councils and maintained nursery schools for an additional term, we urge the Government to deliver a long-term funding solution in this year’s Spending Review which ensures that all children are able to access the high-quality early education that they deserve.’

Tracy Brabin MP, Labour’s shadow minister for early years, commenting on the Government’s announcement on maintained nursery funding, said, ‘With nurseries going bust and others warning of dire consequences because of the Government’s failure to fund early years properly, the stop-gap funding announced today is too little, too late.

‘The sector badly needs additional funding, but nurseries are left waiting for the spending review for any certainty about their financial future. The Government must end that uncertainty and give them a sustainable, long term funding settlement. 

‘Labour will transform early years education, giving the sector the investment it needs as part of a National Education Service, which provides free childcare for all two-, three- and four-year-olds.’

PVI sector response

Both the National Day Nurseries Association and the Early Years Alliance criticised the Government for ignoring private and voluntary nurseries that makeup the vast majority of the sector, with 24,000 providers.

The Early Years Alliance said the Government was letting down the majority of parents whose children attend PVI settings.

Chief executive Neil Leitch said, ‘It beggars belief that the Government has seen fit to completely ignore the challenge facing the PVI sector.

‘While today’s announcement will understandably be welcomed by maintained nursery schools, it does nothing to address the wider funding crisis engulfing the early years sector. This is at best a stop-gap measure which will safeguard the short-term future of a tiny proportion of childcare provision used by only a few thousand parents. No one wants to see these nursery schools close unnecessarily, but the fact is that we are already seeing – and will continue to see – thousands of childminders, pre-schools and nurseries close for a lack of funding.

‘Wrapped up in today’s promise of more funding for nursery schools is a tacit admission from the government that there is simply not enough money in the system. Sadly, the time for admitting there is a problem has long passed: the Government must act now to increase funding across the whole sector.’

Purnima Tanuku, chief executive of National Day Nurseries Association (NDNA), said, ‘Although this money is only being made available to nursery schools, the minister has acknowledged that it is difficult to offer funded places for children on the current hourly rates. The Government has said for the past few years there is no more money to boost funding rates, so it is interesting he has found this money for a small proportion of providers.

‘Private, voluntary and independent (PVI) nurseries deliver the vast majority of funded places in England, but are being completely overlooked. This adds insult to injury as their funding rates have been frozen while staffing costs have been increasing substantially year on year. Even though nursery schools pay towards a head teacher’s salary, private nurseries have more staff and higher overheads including crippling business rates which have been scrapped in Wales and Scotland.

‘The minister must address the overall funding shortfalls as a matter of urgency before the spending review.’

The NDNA renewed calls for the £600m Tax-Free Childcare underspend should be returned to the sector to support all providers with sustainable funding.

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years (PACEY), said, ‘If maintained nurseries can be given additional dedicated funding and support, so should other providers struggling with the same issues.’