The sector has had high expectations for more sustainable levels of funding from the Early Years Single Funding Formula, and the announcement by children's minister Dawn Primarolo that she is delaying its implementation is simply delaying fairer and more equitable funding.
Providers have had mixed experiences of the formula, but NDNA questions why, a few months before it is due to go live, a high proportion of local authorities are saying the formula is not ready. Only recently the Government reported that pilot areas showed that delivering the formula was possible. When announcing the changes to the funding for the free entitlement, the Government said that if the EYSFF was not effective, it would revisit the idea of separately identifying the funding for funded places.
NDNA believes it is vital that this happens as a matter of urgency to protect early years money and ensure it reaches frontline providers where it is desperately needed. Such a move will also help ensure that where the cost-analysis process has identified the need for more money, based on provider costs, but where the pot is not big enough, local authorities have a clear case for increased money from central Government.
Ultimately, delaying the formula will only mean that the road to achieving fairer funding is longer for PVI providers. If a delay is implemented because local authorities report it is not working, then Government needs to explore why and what action needs to be taken centrally and locally to resolve issues.
Many PVI providers have put in a huge amount of effort, sitting on groups and sharing information about their costs. Funding for the free entitlement is at crisis point, and there will be many questioning how, with funding unresolved, they can deliver a flexible 15-hour offer.
As DCSF data shows, most providers do not cover costs, let alone make any surplus they can re-invest in quality. The PVI sectors are vital to delivering a flexible 15-hour offer, but currently it is not sustainable for the vast majority.
NDNA is concerned that Government is delaying the formula, when the sector truly needs change to happen now - and for it to be done so successfully. We will be working to highlight how we must get this right rather than put it off, which simply risks the viability of nurseries further in the current economic climate.