Pre-school Education: Finance

Department for Education written question – answered at on 16 October 2017.

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Photo of Tulip Siddiq Tulip Siddiq Labour, Hampstead and Kilburn

To ask the Secretary of State for Education, what her policy is on adjusting the total budget allocation for the early years national funding formula to take account of inflation in 2017.

Photo of Tulip Siddiq Tulip Siddiq Labour, Hampstead and Kilburn

To ask the Secretary of State for Education, what assessment she has made of the effect of business rates of increases on the (a) number and (b) quality of early years settings in England.

Photo of Robert Goodwill Robert Goodwill Minister of State (Education)

We are increasing spending on childcare to over £6 billion per year by 2019-20 which includes £1 billion a year to deliver 30 hours of free childcare and increase our hourly funding rates. Our new funding rates are based on our ‘Review of Childcare Costs’ which looked at both the current costs of childcare provision and the implications of future cost pressures facing the sector. The Review was described as “thorough and wide ranging” by the National Audit Office.

The Government’s total hourly funding rate for three- and four-year olds (national average to local authorities) increased from £4.56 to £4.94 in April 2017. This compares very favourably with research into the cost of childcare, published by Frontier Economics in July 2017, which shows that the mean hourly delivery cost of a three/four year old place was £3.72.

The Government has also increased Small Business Rate Relief and provided authorities with funding to support £300m of discretionary business rates relief, which could be used to support local nurseries.

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