Agenda item

Lisa Potts introduced the report (Agenda Item 12), which set out the proposed funding rates for early years providers. </AI11>

Lisa Potts explained that the Department for Education (DfE) had requested the publication of the rates by 28th February 2025, necessitating an earlier discussion of the rates ahead of the full budget for 2025-2026. She highlighted the rates for various funding streams, including uplifts for three and four-year-olds, two-year-olds, and under two-year-olds, as shown in table 5.2 of the report. Lisa Potts reported that the quality rate and the early years pupil premium would remain unchanged, while the Disability Access Fund was set by the DfE.

Lisa Potts reported that the Early Years Funding Group had discussed the rates and felt they were fair. She explained that the local authority was required to pass through 96% of the grant received to providers, with the remaining 4% retained for costs such as systems and quality checks. Lisa Potts acknowledged that there was still a deficit on the early years block and that the proposed rates aimed to address this while meeting the DfE's requirements. She asked if there were any questions on the report.

Keith Harvey raised a question about why the quality rate had not increased, given the teacher pay rise and other cost pressures. Lisa Potts responded that the decision was influenced by the existing deficit on the early years block and that a review of the criteria for the quality rate was planned. It was possible the quality rate might change in future years following this review.

Chris Prosser asked if the rates were lower than the local authority rates due to the aim of reducing the deficit. Lisa Potts confirmed that the rates were set to match the 96% pass-through requirement stipulated by the DfE, and the remaining 4% was retained to cover costs such as systems and quality checks. Lisa Potts reported that the impact on the deficit would be reviewed in the next meeting when discussing the 2025-2026 budget.

RESOLVED that the Schools’ Forum noted the report and that the rates would be published as required.