Agenda item

2023/2024 Early Years Funding Formula


Aileen Chambers and Neil Hardwick to report.


Recommendation:-  (1)  That Option 1 is agreed.


(2)  That the local funding formula is maintained with the TPPG additional element added to the base rate and distributed across all provider types.


Consideration was given to the report presented by Aileen Chambers and Neil Hardwick which detailed the statutory guidance in place for the allocation of early education funding; the current position and proposals for the 2023/24 allocation.


The Department for Education (DfE) had consulted on changes to the National Funding Formula for 2023/24.  The outcome of the consultation was published on 16th December 2022 and included some changes to the National Funding Formula.


Local Authorities were, therefore, required to allocate the funding to early education providers based on a local funding formula made up of a single base rate and a mandatory deprivation supplement (for 3/4 year old early education).  Local Authorities could retain 5% of the 3/4 year old early years funding allocation to fund central services.


Local Authorities were also required to consult providers on annual changes to their local formula, including the Schools Forum, on changes to local early years funding formulas, including agreeing central spend by 28th February, 2023 whilst noting the final decision rested with the Local Authority. 


Details were shared on the options available, single funding formulae, benefits and risks for consideration and agreement and were detailed as:-


Option 1:-


Retain the current local funding formula in 2023/24 as set out in detail as part of the report with the TPPG added to the base rate to be distributed to all providers.


Option 2:-


Change the current Single Funding Formula to include a supplement to passport the TPPG element to schools with a proposal to introduce a Quality Supplement for schools/providers who employ a QTS to directly deliver their Foundation 1 class. 


The DfE have allocated an amount of 13p /hour for all 3/4 year olds taking up a place at January, 2022 census to passport the appropriate amount of TPPG into the budget. 


The equivalent amount of TPPG received by schools in 2022/23 ranged from 13p to 36p/h with the average rate being 20p/hour.  Maintaining the average rate of 20p/hour for the schools who would be eligible to receive TPPG would enable the base rate to be enhanced by 18p/hour for all providers. 


The appendix attached to the report detailed the extracts from the DfE Early Years Funding Operational Guidance 2023/24 which outlined expectations.


Historically schools have received TPPG based on the total number of 2,3 and 4 year olds on roll at January census.  The TPPG element mainstreamed into the Early Years Block had been calculated based on all 3 and 4 year olds accessing early education across the school and PVI sector at January census.


It was highly likely that an extra-ordinary meeting of the Schools Forum may be required in March, 2023 for a formal decision following consultation.


Discussion ensued on the implications for the PVI sector in the context of pressures and how Option 1 could place some nurseries in jeopardy.  In addition the sector were experiencing difficulty in sustaining and recruiting relevant staff. 


Alternatively the view was some schools believed they would lose out under Option 2 and seventeen schools had indicated they were not employing qualified teachers for three and four year olds, which was a concern in terms of the quality of provision.


The pros and cons of each option were commented on and a number of questions had been raised prior to the meeting where it was noted that the rationale for Option 1 would increase the base rate.


Where schools under both options were receiving less funding this was because the equivalent amount that the schools were receiving previously in TPPG were higher than the proposed current increases (27p for Option 1 or 18p for Option 2). 


Forum Members were advised they were not being asked to vote on the options before them , but to indicate a preference as part of the consultation process.


Agreed:-  That Option 1 be recommended for approval for consultation:-


·       That the local funding formula be maintained with the TPPG additional element added to the base rate and distributed across all provider types.

Supporting documents: