Question to the Department for Education:

To ask the Secretary of State for Education, what steps he is taking to help support an increase in the number of early-years childcare providers in England.

Data from Ofsted, shows that the number of providers on the early years register has remained broadly stable since the start of the COVID-19 outbreak until the end of November 2020 and that current parental demand for childcare places is being met by the market. The government recognises the importance of supporting the early years sector financially during the COVID-19 outbreak and recognises the risk to providers’ financial viability caused by changing levels of use of childcare.

Early years settings will continue to benefit from a planned £3.6 billion funding in the 2020-21 financial year to create free early education and childcare places. On 25 November, my right hon. Friend, the Chancellor of the Exchequer announced a £44 million investment in 2021-22. We can now also confirm that in 2021-22 we will increase the hourly funding rates for all local authorities by 8p an hour for the 2 year old entitlement and, for the vast majority of areas, by 6p an hour for the 3 and 4 year old entitlement. This will pay for a rate increase that is higher than the costs nurseries may face from the uplift to the national living wage in April. Funding beyond 2021-22 will be considered in the round at future spending reviews.

In addition to this, the government has provided a package of support for individuals and businesses which are directly benefitting providers of childcare. This includes business rates relief and grants, the extended Self-Employment Income Support Scheme and the extended Coronavirus Job Retention Scheme, which will remain open until April 2021, with employees receiving 80% of their current salary for hours not worked, up to a maximum of £2,500.

We continue to work with local authorities and the early years sector to monitor the childcare market, including sufficiency of provision, and to understand how they can best be supported.