Support for Childcare Providers

Having received a number of emails from constituents who are understandably concerned about support for childcare providers during the Covid-19 pandemic, and having raised the issues they highlighted with my colleagues at the Department for Education, I'd like to share the following detailed response:

I am writing to provide you with an update on all the work the Department for Education is doing to support the early years and childcare sector’s response to the coronavirus (COVID-19) pandemic. I want to ensure there is sufficient childcare so that critical workers can continue working, and all vulnerable children can access childcare throughout the pandemic. It is also important that there will remain in place a functioning childcare market to enable parents to return to work after the outbreak, and so that all children are able to get the best start in life with access to high quality early education. 

Support for early years and childcare businesses

Since the onset of COVID-19, the government has worked to put in place a significant package of financial schemes that the childcare sector can access.   This includes the Coronavirus Job Retention Scheme (CJRS), the Coronavirus Self-employment Income Support Scheme, a business rates holiday for childcare providers large enough to pay them, and a £10,000 Small Business Grant for those too small to pay business rates. Further information is included in the annex to this letter. [Please see below for a list of financial support for childcare providers]

The CJRS guidance (https://www.gov.uk/guidance/claim-for-wages-through-the-coronavirus-job-retention-scheme ) has always been clear that “where employers receive public funding for staff costs, and that funding is continuing, we expect employers to use that money to continue to pay staff in the usual fashion – and correspondingly not furlough them. This also applies to non-public sector employers who receive public funding for staff costs” It also states that “where organisations are not primarily funded by the government and whose staff cannot be redeployed to assist with the coronavirus response, the scheme may be appropriate for some staff.” 

Last week the Department issued guidance ( https://www.gov.uk/government/publications/coronavirus-covid-19-financial-support-for-education-early-years-and-childrens-social-care ) which confirms that early years providers remain eligible for the CJRS while continuing to receive early entitlement funding via local authorities. This new guidance sets out that early years providers can access the CJRS to cover up to the proportion of their pay bill which could be considered to have been paid for from their private income. 

We have worked hard to get this much needed clarity for the sector. This is a complex situation involving schemes which must be fair and work for all sectors. It is important to note that we have taken this approach in order to support providers while also protecting the taxpayer from double funding (paying for staff to be furloughed whose salary is already being paid for by other public sector funding). 

Use of free early education entitlements funding

On 17 March the Government committed to continue the free early education entitlement funding to local authorities throughout the COVID-19 pandemic. We will shortly be publishing guidance to support local authorities to use their free entitlement funding differently, redistributing it – in exceptional cases and in a clearly focused and targeted way – in order to secure childcare for the children of critical workers and for vulnerable children, where their usual arrangements are no longer possible.  

Local authorities will need to ensure there are sufficient childcare places at this time, and to redistribute funding across settings accordingly. This ability to redistribute will enable local authorities to ensure that critical workers, including NHS staff, are able to access childcare where they need it. Any setting which sees their early entitlement funding reduced in order to fund childcare places elsewhere will be able to increase the proportion of their salary bill eligible for the CJRS in line with the Department’s guidance on access to the scheme. 

Legislative changes and keeping people safe

We have listened to the sector on the challenges faced in providing safe and quality childcare and early education during the pandemic. We have worked quickly to amend regulations, where appropriate, so that we are able to provide the right support for early years providers remaining open to care for vulnerable children and children of critical workers so they can continue to ensure high quality and safe provision at all  times. 

I know colleagues are as concerned as I am to ensure people working at the frontline of childcare provision are equipped to do their job in a way which ensures their own personal safety and that of the children in their care. We have worked closely with public health colleagues to follow the most accurate scientific advice available. This advice indicates that childcare practitioners do not require personal protective equipment. They should care for children as normal, although increase the frequency of handwashing and cleaning of surfaces and toys.

We will be temporarily disapplying and modifying certain elements of the EYFS statutory framework (https://www.gov.uk/government/publications/early-years-foundation-stage-framework--2 ), which is the framework which sets the standards that all early

years providers must meet to ensure that children learn and develop well and are kept healthy and safe. These changes will allow providers greater flexibility to respond to changes in workforce availability and potential fluctuations in demand, while still providing care that is high quality and safe. Changes include; providers not being required to meet existing learning and development requirements, providers not being required to undertake the EYFSP assessment in 2019/20 or the 2 year progress check during the coronavirus (COVID-19) period, exceptions allowed to the qualifications that staff hold in order to be counted in ratio requirements as well as changes to requirements around paediatric first aid (regarding children aged 2-5 years old).  

All changes to the statutory framework are subject to parliamentary process and guidance will be issued once these changes come into force. 

The Department will continue to monitor the situation in early years carefully, and work closely with colleagues across central and local government to provide the necessary support, issuing guidance and updating it regularly to respond to the fastmoving nature of this crisis. The latest version of this guidance is available at https://www.gov.uk/government/publications/coronavirus-covid-19-early-years-and-childcare-closures/coronavirus-covid-19-early-years-and-childcare-closures 

List of financial support that childcare providers may access: 

On 17 March 2020, the Chancellor announcement that the government would continue to pay free early education entitlements funding – worth £3.6 billion a year - to local authorities throughout COVID-19. 

The government is also delivering a comprehensive package of support for workers and businesses which will benefit childcare providers, including: 

• The Coronavirus Self-employment Income Support Scheme (CSISS), under which the self – employed, including Childminders may be eligible to receive taxable grants; 

• A business rates holiday for one year, during which time non-local authority providers of childcare will pay no business rates in 2020-21, from 1 April; 

• Businesses eligible for Small Business Rates Relief will also be eligible for a £10,000 cash grant, increased from £3,000; 

• The Business Interruption Loan Scheme will now be interest-free for 12 months (rather than 6); 

• VAT payments due with VAT returns between now and end June 2020 will be deferred, UK VAT registered businesses will not need make those payments until the end of the financial year. 

Further details on government support for early years providers can be found here:

https://www.gov.uk/government/publications/coronavirus-covid-19-early-years-and-childcare-closures/coronavirus-covid-19-early-years-and-childcare-closures#funding

I hope this information is helpful.

Kind regards
Neil