Agenda item

This report confirms the provisional Early Years Block DSG funding for Brent, in order for the local Early Years Funding Formula to be set for 2022/23.

Folake Olufeko, Senior Finance Analyst at Brent Council introduced the report which outlined the provisional Early Years Block DSG funding allocation for Brent as supported by the Early Years Funding subgroup.

In presenting the report key points highlighted included:

·                The increases to the funding rates allocated to Brent for 2-year-old, and 3 and 4-year-old provision, however, overall funding allocations had reduced due to a reduction in demand for Early Years Provision since January 2020 as a result of the restrictions introduced due to Covid 19.

·                The increased funding provided in relation to the EYNFF hourly rate for 3 and 4 year olds, as detailed within section 4 and Table 1 of the report.  In terms of 3 and 4 year old funding it was proposed that this would be distributed to providers as a universal base hourly rate plus an additional allocation for deprivation; after the 5% reduction for central resources, on the basis of the details within section 5 of the report.  The Forum also noted, in relation to the provision of funding supplements that the maximum 10% allowable had been applied in relation to deprivation.

·                The DfE provisional funding estimates for 2 year old funding had been based on the January 2021 census data with confirmation provided that the actual  funding allocation for 2022/23 had reduced in line with a 6% reduction in take up hours experienced between January 2020 and January 2021 as a result of the impact from the pandemic. Take-up numbers for both the 2 year old and the 3 & 4 year old entitlements had, however, since increased from January 2021 and were now at 90% of the pre-Covid- pandemic levels, based on headcounts as at November 2021. It was therefore anticipated that these increased numbers would be reflected in the final allocation for 2022/23, which would be based on the January 2022 census.

·                With regard to centrally retained funding the DfE guidelines mandated  local authorities to pass through 95% of the Early Years funding for 3 and 4 years olds to providers, however no mandate existed on  how much of the 2 year old funding local authorities could retain for central services.  It had therefore been recommended that 5% of Early Years funding for 3 and 4 year olds was retained in 2022/23.  This would equate to £0.911m, compared to a £0.937m equivalent in 2021/22; a reduction of £0.026m on the previous financial year.  In terms of the 2 year old rate, it was proposed to retain £0.13p of the increase to the 2 year old rate (£59k compared to £25k which was retained in 2021/22), as a contribution towards the provision of central services to support the sector.  This allocation would ensure continued delivery of the training offer which had been acknowledged by the Early Years Funding subgroup as a required service and was valued by providers, as well as other key central support provisions.  The Forum noted this would bring the total budget allocation for central services in 2022/23 to £0.970m, a reduction of £0.132m from the previous financial year.

·                The detailed consideration and discussion of the proposals by the Early Years Funding Sub Group, as detailed within section 8 of the report.

·                The update provided in relation to the Specialist Nursery Panel funding, which for 2022/23 valued £0.417m in order to ensure that children with the most complex needs would continue to be supported to attend one of the specialist nursery settings, where appropriate.

·                In terms of additional funding for maintained nursery schools the provisional allocation of supplementary funding in 2022/23 was £0.732m which compared to £0.717m in 2021/22.  This represented an increase of 2.1%.  In addition, the Forum was reminded that the £6.9m it had been estimated Brent would receive as part of the Schools Supplementary Grant would also be available to support maintained nursery schools with cost pressures in respect of the 1.25% Health and Social Care Levy (increased National Insurance contributions) effective from 2022/23.

The Chair thanked officers for the report and asked if Forum members had any questions. In considering the update provided the following issues were raised by the Forum:

·                In response to further clarification sought around the early years funding offer, confirmation was provided that detailed discussion had taken place regarding the proposed hourly rates and central retention with the Early Years Funding Sub Group. Members of the group, whilst recognising the significant financial pressures and challenges faced across the Early Years sector had been in agreement with the proposed retention of 2% for the 2 year allocation and 5% from the 3 and 4 year allocation for central support having recognised the value for money and nature of support and training provided through the Early Years Support Services.

·                The Forum also recognised and supported the concerns highlighted in relation to the Early Years PVI sector given the pressures identified as a result of the impact of the pandemic on costs, staffing and also the reduction in children taking up places across the sector.  Members also recognised the significant risks these challenges and pressures had created in relation to the ongoing sustainability of many PVI providers and strong support for the sector expressed by the Early Years Funding Sub Group in terms of the consideration of broader support options available given the constraints on the allocation of funding required under the DfE early years funding formula, focussed around maintained early years settings

Having noted the comments made, it was RESOLVED to endorse Brent Early Years Funding Formula for 2022/23, as supported by the Early Years Funding Sub Group, on the basis of the following recommendations being applied to the formula:

(1)     A universal base rate for Brent providers for 3 and 4 year old funding of £4.74 per hour, which has increased by £0.15p from £4.59 in 2021/22.

(2)     An allocation for deprivation for 3 and 4 year funding of 10%.

(3)     A base rate for Brent providers for 2 year old funding of £6.16 which has increased from £6.04 in 2021/22.

(4)     A cap on centrally retained funding by the local authority of 5% of 3 & 4 year old funding.

(5)     A retention of £0.13p from the 2 year old funding for support services.

(6)     The funding previously allocated under a disapplication for the 2017/18 academic year for additional 15 hour places for some 3 and 4 year old based on local eligibility continues to be allocated to the Under 5s Nursery Panel, and both PVI and maintained providers can apply for this, to ensure the funding continues to be targeted at vulnerable children.