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NEWS: Local authorities can divert entitlement funding in exceptional cases

In England the DfE has announced changes to how local authorities can distribute 'free' entitlement funding while COVID-19 restrictions are in place. The new guidance explains how “local authorities can use their entitlement funding differently, redistributing it – in exceptional cases and in a clearly focused and targeted way – in order to secure childcare for the children of critical workers and for vulnerable children, where their usual arrangements are no longer possible.”

Liz Bayram, Chief Executive at PACEY commented:
"Whilst the laudable intention in this latest guidance is to help local authorities ensure there are sufficient childcare places for critical workers, including NHS staff, it holds major consequences for childcare providers who are currently closed. These providers are doing what Government asked of them at great risk to their livelihoods. They were anticipating continued entitlement funding from their local authority as the DfE had said should happen at the very start of this pandemic. Now this may no longer be a certainty and, coming fast behind the u-turn on funded places and furlough of staff, this new guidance is further unnecessary pressure and confusion for childcare providers.

“We know from recent DfE data that very few children of key workers or vulnerable children are currently attending settings. We know that some local authorities have been truly innovative in identifying additional funding to support settings to stay open whilst still providing the much needed entitlement funding to settings that have had to close. Given recent research by NDNA identified how many local authorities had not distributed all of the funds they had for entitlement places, PACEY has to join providers in questioning why – even in exceptional circumstances – it is felt reasonable to tell local authorities they can now claw back the funding that was previously promised?

The DfE’s new guidance says any setting which sees their early entitlement funding reduced by their local authority will be able to increase the proportion of their salary bill eligible for the Coronavirus Job Retention Scheme in line with the guidance.

Liz continues: "this is little reassurance for most providers who are now struggling with complex calculations to identify the proportion of their salary staffed that can be furloughed."