Agenda item

(Councillor Dominic Boeck left the meeting at 6.20pm)

The Forum considered a report (Agenda Item 9) to set out for the Early Years Block the likely financial position and under spend to be carried forward for 2015/16, and detail the proposals for setting a balanced budget for this block in 2016/17.  

As at February 2016, 116 early year’s providers were funded from the Early Years block.

In setting the 2015/16 early years block budget, it was assumed that the in year growth in numbers experienced in the previous few years would be repeated, and so the same percentage increase was included in the estimate. On this basis there was a shortfall in three and four year old funding, but the under spend in 2014/15 (mainly from two year old funding) was carried forward to support this budget without the need to adjust downwards the funding rates paid to providers. It was recognised that this would only be a solution for one year if all the carry forward was used in 2015/16.

Indicative figures from the January 2016 census were now available to estimate the funding for the year, and Spring term payments to providers had been estimated to be able to forecast total expenditure for the year. Table 2 sets out the current forecast on each budget line within the early years block.

Table 2

The current figures indicated an overall under spend of £577k.The increase in numbers of 2, 3 & 4 year olds accessing the free entitlement had not materialised as forecasted and as in previous years, and this stability in numbers appeared to be a national trend.

The overall in year position was an over spend of £90k compared to the original estimate of £667k. Had the carry forward from 2014/15 not been available and the rates paid to providers had been reduced, this would therefore have resulted in an under spend but at a significant detriment to providers. This illustrated the volatility of this budget, and the need to have back up funding available.

The overall in year overspend of £90k would be met from the 2014/15 carry forward of £667k, leaving £577k available as one off funding in 2016/17. These figures were forecasts and the final figure for the year could vary by as much as £100k.

The estimate for 2016/17 is set out in Table 3 (alongside the 2015/16 forecast), based on the following assumptions:

·         The same number of hours of provision as per the 2015/16 actual for existing providers (adjusted for the actual number of weeks in the financial year for the maintained sector). No in year growth in hours of provision is assumed.

·         Quality bands have been adjusted for each provider as appropriate according to the employee data in the January 2016 returns.

·         The same funding rates as 2015/16 have been applied.

·         An increase in PPG take up has been assumed.

·         An increase in the centrally retained budget due to staffing costs in respect of the additional work involved in PPG and two year old assessments.

·         The January 2016 census pupil numbers only have been used to predict the DSG funding for the full year. This assumes numbers will remain stable.

·         The PPG grant matching the actual hours of take up.

Table 3

In order to balance the budget in 2016/17, part of the under spend from 2015/16 (£374k) would be required; leaving £203k. Rather than adjust funding rates downwards (which would be a significant negative impact on this sector), it was proposed to maintain the current rates, as set out in appendix B of the report, for a further year by utilising the carry forward. This included maintaining the deprivation rate of £0.47 per hour which is added to the pupil premium. From 2017 increased funding rates and a new national formula were then due to be implemented.

Like with the other aspects of schools funding, the Government had stated its intention to have a national early year’s formula from 2017 but further details were unclear.

The Heads Funding Group supported the proposals set out in this report but in addition requested that part of the 2015/16 under spend be used to retain part of the pre-school teacher counselling service (the high needs budget proposal was to cut this budget by £85,000) at a cost of £45,000 in 2016/17.

Bruce Steiner proposed that the Early Years Budget 2016/17 be approved as laid out in the report including the recommendation from the Heads Funding Group. Brian Jenkins seconded the proposal. The Chairman invited the Forum members to vote on the proposal, which at the vote was carried.

RESOLVED that the Early Years Block Budget 2016/17 be agreed as laid out in section 5 of the report and including the recommendation from the Heads Funding Group that part of the 2015/16 under spend be used to retain part of the pre-school teacher counselling service at a cost of £45,000 in 2016/17.