Agenda item

The Schools Forum received a report seeking comments on proposals from the council for the funding arrangements to be put in place for Early Years (EY) provisions from 2017-18 and to approve the release of the consequential consultation document to providers and other interested parties.

Changes need to be made in order to meet new requirements from the DfE, of which the key elements were set out as:

• Extending the free entitlement from 15 to 30 hours a week for eligible working families from September 2017
• BFC would receive an extra 14.1% in per pupil funding rates in 2017-18, rising to 20.1% in 2019-20 when a contribution to transitional funding protection to LAs losing money ends.
• LAs could retain no more than 5% of funds for centrally managed budgets that did not ultimately get passed on to providers
• An SEN inclusion fund, Disability Access Fund (DSF) and general contingency could be maintained and these would be outside the 5% cap as the expectation is that the funds would ultimately be passed on to providers
• The local EY Funding Formula would have to allocate at least 90% of funding through a uniform base rate paid to all providers, irrespective of their setting type or background
• Hourly top-up rates could be paid when providers meet eligible criteria, but would be limited to:
  • Deprivation
  • Flexibility
  • Delivering the additional 15 hours
  • Efficiency
  • sparsity

The key proposals from BFC in the published report related to:

·         Holding a maximum of 3% in budgets centrally managed by BFC

·         Establishing an SEN inclusion fund, a DAF and a provider contingency

·         Pay a uniform hourly base rate of around £4.08 (92.75% of available funds) and include only the following hourly top up supplements for:

o   Deprivation (5%)

o   Flexibility (1%)

o   Delivering the additional 15 hours (1.25%)

To support the consultation, two evening briefing sessions would be held in January for providers to attend to raise questions and comments.

In order to have sufficient time to engage with local providers on the best way to meet the new requirements, the local BFC consultation was proposed to be released on 9 December. This was originally expected to be in advance of final DfE decisions as to delay any further would put at risk a successful 1 April implementation. However, on 1 December, between the publication of the Forum report and the actual meeting, the DfE did release details of how EY funding would need to operate from 2017-18 and this did include a number of significant changes from the original consultation document.

This late information required a supplementary report to be emailed to members and tabled at the meeting which included some revisions to the original published paper to reflect changes made by the DfE from those contained in the original consultation proposals. The key changes in the tabled paper all related to the local EY Funding Formula and were:

• To increase the amount to be paid through supplements that would need to be funded through a reduced amount of uniform base rate, which was now estimated at £4.00 per hour (91% of available funds)
• For the supplements
  • Deprivation (5%). Would now take account of both Income Deprivation Affecting Children Index (IDACI) scores and eligibility to EY Pupil Premium,. Each measure to distribute 2.5% of available funds.
  • Quality now to be used (3%). Not originally allowed but will now be permitted. This would have different, but similar eligibility criteria compared to the existing supplement.
  • Delivery of the additional 15 hours (0%). No longer to be permitted, originally to allocate 1.25%
  • Flexibility (1%). No change
  • English as an additional language was not originally allowed but will now be permitted. Proposed to support these children through a centrally managed BFC budget rather than include within the hourly rate supplements.

As a result of the members questions, the following points were made:

• The reason for the current differential base rate funding of £3.17 to schools and £3.71 to PVI providers was mainly as a result of evidence from the 2010 provider cost survey that identified that schools had  minimal accommodation costs compared to PVI providers who generally incurred rental costs.
• The additional staff costs that schools had to incur were financed through the quality supplement, with most schools receiving the middle supplement of £0.27 per hour.
• Only one school received the highest quality supplement rate, which is now proposed to be removed.
• In terms of being able to deliver the additional 15 hours to eligible parents that wanted to take it up, BFC had worked closely with many of the PVI providers regarding this. There had also been engagement with childminders and out of school provided such as holiday clubs. Most of the feedback had been positive, but it was still early days with many of the providers waiting to see what the funding looks like before committing to providing extra hours

POST MEETING NOTE:

Final pre-publication checking of the BFC EY consultation document identified an error in the calculation of the deprivation top-up supplement. In calculating the number of EY pupil premium children that would be funded, the calculation used the total number included on each of the 3 termly census counts, rather than converting each count number to an annual average. The effect of this was to overstate numbers by around 300%. Using the correct number of EY pupil premium children and allocating the proposed 2.5% of funds through this measure would result in an hourly top up rate of £1.93 which is considered too high. The final consultation document therefore proposes that 4% of available funds are allocated for deprivation via IDACI scores and 1% via EY pupil premium rates. This would maintain the total 5% allocation through deprivation measures, produce outcomes similar to those presented in the annex to the published report and result in an hourly top up rate for EY pupil premium children of £0.77 compared to the original calculation of £0.66.

RESOLVED that the Schools Forum AGREED the distribution of the EY funding consultation document and supporting papers at Appendices 1 and 2 of the original report, after making the changes set out in this report, subject to any further amendments agreed by the Schools Forum.

RESOLVED that the Schools Forum NOTED, following a nomination process, that Michelle Tuddenham has been appointed as the new EY provider representative on the Schools Forum (paragraph 6.3 of the original report).