Question to the Department for Education:

To ask the Secretary of State for Education, what assessment her Department has made of the potential impact of early years funding levels on the ability of providers to meet increasing operating costs and deliver high-quality early education and childcare.

It is our ambition that families have access to high-quality, affordable and flexible early education and care, improving the life chances for every child and the work choices for every parent. As the government builds a stronger economy with sustainable public finances, it is continuing to invest in the early years sector, supporting the successful delivery of the entitlements.

In 2026/27, we plan to provide over £9.5 billion for the early years entitlements. National average local authority hourly rates will increase by 4.95% for 3 and 4-year-olds before the termly adjustment, 4.36% for 2-year-olds, and 4.28% for children aged 9 months to 2 years.

These increases continue to reflect in full forecast cost pressures, including the National Living Wage announced at Autumn Budget 2025 and wider workforce pressures. Hourly rates are intended to cover the staff and non-staff costs of providing 15 or 30 entitlement hours.