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DfE confirms local authority funding rates for 2022/23

By Rachel Lawler

The new early years funding rates paid to local authorities in England for 2022/23 have been published today.

The local authority rates for three- and four-year-olds will increase by 17p per hour across most areas, while rates for two-year-olds will increase by 21p per hour for most local authorities.

The final rates due to be paid directly to providers will be confirmed by individual local authorities.

EYPP increases by 7p
The government has also confirmed that the Early Years Pupil Premium funding rate will increase next year from 53p to 60p per hour.

Disability Access Funding will also rise from £615 to £800 per child. 

The minimum rate any council will receive from central government is now £4.61 per hour. However, it is important to note that these changes apply to the hourly funding rates that local councils will receive, not necessarily frontline providers.

All of these changes will come into effect in April 2022.

FOI findings on funding rates
Earlier this year, the Alliance's FOI investigation into how early years funding rates were set revealed that the government calculated in 2015 that by 2020 it would cost £2bn to fully fund the sector and that doing so would result in a three- and four-year-old funding rate to local authorities of £7.49 per hour. 

Closing the gap
Neil Leitch, chief executive of the Alliance, comented: "We welcome clarity on how the funding increase announced at the Spending Review will translate to hourly rates for councils, and importantly, confirmation that rates will see a significantly larger increase than has been the case in recent years.  

"That said, the fact remains that the funding rises published today don’t come close to closing the funding gap identified by the government’s own policy documents, and many in the sector are rightly concerned that they will still face a struggle to remain viable. Worse still, many providers won’t even find out the funding rates they themselves will be receiving until the last minute, making it impossible to budget and plan. 

"The government has claimed that this additional funding will more than cover increases in the national living and minimum wages, but even if this is the case – and there is as yet no evidence to support this claim – how can it be right that the early years is given just enough to pay staff the minimum wage at a time when the government is committing to giving all teachers a starting salary of £30,000? 

"If the government truly wants to show that it values the early years, it needs to stop giving providers just enough to survive and start giving them what they need to thrive. What we need now is an ambitious vision for the sector – and the substantial investment to back it up."