Agenda item

Avril Allenby introduced the report (Agenda Item 9), which aimed to update the Forum on the deficit recovery for the Early Years Block (EYB) and explore the impact of any amendments to the deficit recovery plan on Covid recovery for children and provider stability.

Avril Allenby explained that the report set out some of the context behind the deficit recovery plan for the EYB. A new budget had been set in 2019/20 and this was when the EYB had first gone in to deficit. This was then compounded by a number of factors set out in detail under section two of the report including increased local rates and the Covid-19 pandemic. This had meant that the way funding had been distributed in early years nationally had changed annually with no consistency.

A deficit recovery plan had neem put in place, which had been discussed in full with the Early Years Funding Group. A five year plan had been agreed, which provided lower savings in the first few years as providers recovered from the Covid-19 pandemic, with larger savings planned in later years. Due to some of the factors, work on the deficit recovery plan had been delayed and not start until 2020/21. Alongside this, ways to support providers locally had been required because of the impact of Covid and growing financial pressures.  Local sustainability grants had been given to providers locally to mitigate some of the issues being faced.

Avril Allenby reported that reduced funding rates had resulted in changes in the pass through rate and the Government had committed new funding to early years as part of the Spending Review. This money would be distributed over a three year period (starting with the current year’s budget) however, had needed to be balanced against the need to recover the deficit.

Avril Allenby that they had not managed to save as much as hoped in the first year of the deficit recovery plan however, the deficit had not increased which was positive. It was clear however, that the plan was not achieving what it had set out to achieve and it would be important to keep monitoring it in the current year. The plan might need to be changed for future years to introduce a faster rate of recovery by the end of the five year period. No changes could be made to the plan in the current year as the budget had already been set. Work would continue with the Early Years Funding Group regarding the impact of the deficit and financial climate on providers.

Catie Colston stated she did not envy the situation facing the Early Years team and queried how far they were able to consult with similar staff within other local authorities over what must be a national issue. Avril Allenby reported that there were network groups across the country and there had been a number of briefings by the Department for Education (DfE) on early years funding. West Berkshire also met with the DfE on a six to eight week basis due to the changes in the way the sector was being funded and this provided an opportunity for issues to be fed back. Avril Allenby confirmed that issues facing West Berkshire were the same as those being faced nationally.

Ian Pearson supported the comments from Avril Allenby regarding the complexity of the area. The report showed that the target set in the deficit recovery plan for 2021/22 had not been met. They were now in quarter two of 2022/23 and he felt that it was important that the Forum understood the current year’s target, which was detailed under section 4.1 of the report (£153,616) and the position against this target currently. As r modifications were made to how the deficit was approached, the plan would need to be recalibrated. The consequences of any proposed changes would need to be highlighted and any decisions would needed to be made with these consequences in mind.

Ian Pearson reported that the Government had just reached the end of a period of consultation on early years funding. The funding for the block was not only complicated but was also changeable.

Lisa Potts added that whilst they could currently provide a forecast for the current year based on the number of hours however, they would need to wait for the January schools census data for more accurate picture. This data was used to calculate the income that would be generated for the year and was received mid to late February. It was likely that the current rates would remain for the new year until the impact of the deficit recovery plan in the current year was known.

The Chair acknowledged the complexity and changeable nature of the sector and thanked officers for their work in difficult circumstances.

RESOLVED that the Schools’ Forum noted the report.