Report for Schools Forum
9
Report title:
Early Years Central Expenditure 2016-17
Meeting date:
21 October 2015
Report originator:
Ophelia Carter and Angela Scattergood
1.
Purpose of the report
1.1. For Schools Forum to agree the centrally retained budget levels within the Early Years
Block of the Dedicated Schools Grant (DSG).
2.
Recommendations
2.1. That Schools Forum agrees the proposed early years central spend in principle, noting
that the final figures are not confirmed pending future census data.
3.
Background
3.1. Agreement of the centrally funded early years budget in the DSG is the responsibility of
the Schools Forum. The DSG is allocated to authorities in three funding blocks using
historic spend patterns: the Schools Block, the High Needs Block and the Early Years
Block. The total DSG is considered as a whole at local authority level and allocated
between the three blocks after an assessment of local circumstances, including
priorities, risks and current expenditure pressures.
3.2. In July 2015 the Department for Education issued a call for evidence asking authorities
to report back on the services covered in the centrally retained early years budget. It is
anticipated that this will be used to further compare authorities and develop a national
model for funding. The outcome is expected to be in place for 2016-17. This will drive
the way that early years funding should be distributed, both from central government to
local authorities and from local authorities to institutions. In advance of this, local
authorities still need to plan and deliver services to meet local need.
3.3. The schools revenue funding 2016 to 20171 an operational guide was also published
by the DFE to assist local authorities plan for the following year. With regard to the
Early Years Block, it was stated that: the early-years-block-per-pupil unit of funding in
2016 to 2017 will be confirmed after the spending review and will continue to be based
on participation. The spending review is due to be published on the 25th November
2015. The guide also included the timetable below, with relation to the Early Years
Block:
Date
Week commencing
14 December 2015
DFE/EFA
Publication of DSG Schools Block and High Needs Block allocations
for 2016 to 2017 (prior to academy recoupment).
Publication of provisional Early Years Block allocations.
June 2016
Early Years Block updated for January 2016 Early Years pupil
numbers
1
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/445686/Schools_revenu
e_funding_2016_to_2017_operational_guide_publication_version_final.pdf
Page 2 of 7
Early Years Central Expenditure 2016-17
June 2017
Early Years Block updated for January 2017 Early Years pupil
numbers (pro rata 7/12ths as this relates only to the period September
2016-March 2017).
3.4. Armed with this limited information, the LA is using 2015-16 budget plans and
continuing to work to achieve the best outcomes for pupils across all settings and
schools. The early years DSG allocation is calculated using the following factors (Table
1), the final value being confirmed in July 2015. The same format is expected to apply
in 2016-17.
2015-16 DSG early years block
Hackney
rate funded
£
pupil
numbers
(fte)
2015-16 3 & 4 year old funding
£7,122.63
3,160
2015-16 2 year old funding (provisional)
£5,766.50
592
2015-16 early years pupil premium
2015-16 total early years block (£million)
allocation
£million
22.508
3.414
0.530
26.451
Table 1
3.5. Without considering the impact of a change in the pupil numbers, this report
incorporates changes in policy from last year and sets out the plans to be ready for
national policy changes announced to date. These include:
 planning for the expansion of free entitlement eligibility to 30 hours per week
for 3 and 4 year olds of working families from September 2017;
 continued expansion of the 2 year old capacity;
 embedding the early years pupil premium (EYPP) for disadvantaged 3 and 4
year old’s accessing the free entitlement.
These changes (see section 4) will affect both centrally retained and delegated
budgets, with centrally managed capacity building leading to increased future
delegation.
3.6. The balance between delegation and central funding in 2015-16 is shown in Table 2
below. The local authority is planning to retain the same balance in planning for 201617.
Delegated and Central Expenditure
2015-16 budget
£
22,428,000
83.2%
%
Planned delegation to schools & settings- free entitlement &FT
Subsidised childcare (PVIs full time places for vulnerable pupils)
*
5.0%
1,352,000
87.2%
23,834,000
Family advice & support / marketing of entitlement
2.0%
557,400
SEN, Portage; safeguarding, combating disadvantage
Quality improvement, curriculum support, workforce
development
3.6%
993,000
1.7%
464,900
4.0%
1.3%
12.8%
100%
1,103,000
359,000
3,477,300
Total planned delegation to schools and settings
Capacity building
Management, funding, data collection & compliance
Planned expenditure managed centrally
Total Planned Expenditure
LONDON BOROUGH OF HACKNEY
27,257,300
HACKNEY LEARNING TRUST
Early Years Central Expenditure 2016-17
Page 3 of 7
Table 2
Table 2
*The subsidised childcare budget, set aside to fund full time vulnerable pupils in non-school settings,
is considered by the Department for Education (DFE) to be centrally managed but is passported
directly to settings.
4. Delegation
4.1. In 2015-16, the LA committed to increase the hourly rate for the free entitlement for 3
and 4 year olds to achieve an overall minimum published hourly rate of a £5.75. In
2016-17, decisions on the hourly rate will await the outcome of the budget setting, the
DFE spending review to be announced before Christmas, and the January census. In
principle the local authority intends to maintain the current hourly rate as a minimum.
4.2. Free entitlement for three and four year olds of working families (where both parents/a
lone parent work/s eight hours or more a week) will be increased to 30 hours a week in
September 2017. This development will require significant provision and capacity
planning across the LA, especially for those schools that have maximised part time
places.
4.3. This is likely to be funded through either a transitional specific grant or as an addition to
the 2016-17 DSG. However, if the rate of funding follows the principle of 2 year old
funding and is allocated on a fixed hourly rate, it could fall short of current local
expenditure levels. This will need to be considered once the plans, conditions and
timetable are confirmed before implementation.
4.4. Increasing take up of 2 year old places. The local authority will continue to fund 2 year
olds at the national rate of £6.08 per hour. Hackney is continuing to work with settings
and schools to develop quality provision for 2 year olds. Hackney also set aside an
under-spend of 2 year old place funding in 2014-15. This will be carried forward to
continue to apply to creating new places in 2016-17.
4.5. Work to increase the take-up of the early years pupil premium to target deprivation in 3
and 4 year olds in nursery settings is continuing. The main focus is to raise awareness
with schools and settings, to support them in encouraging parents to declare eligibility
and to deploy resources to narrow achievement gaps
4.6. The Subsidised Childcare Budget targets vulnerable pupils and low income families for
part time/full-time places in PVI settings, and is managed through a commissioning
process. The authority requires settings to use the allocation of part time and full time
places for children from low income families and parents returning to or taking up
training or employment. £1,352,000 is being delegated to providers.
5.
Central expenditure
5.1. The overall budget estimate for 2016-17, for the purposes of this report, is anticipated
to be the same as in 2015-16, with any real terms increase to be delegated to schools
and settings.
5.2. The chart below shows the levels of centrally managed DSG across our neighbouring
boroughs over the past two years, illustrating how we compare. The LA budgeted to
keep a similar level of centrally retained funding in 2015/16 as in 2014/15.
LONDON BOROUGH OF HACKNEY
HACKNEY LEARNING TRUST
Early Years Central Expenditure 2016-17
Page 4 of 7
Figure 1 (source DfE SFR)
5.3. The 2015-16 two year old funding allocations announced in July are provisional and
may be updated, following LA submission of the October 2015 census. Although
Hackney set a budget to achieve the target delegation of 2 year old funding during
2015-16, it is apparent that (as with most London boroughs) this may not be achieved.
5.4. In order to plan services and communicate plans to schools and settings, Forum is
being asked to agree in principle to similar levels of centrally retained budget as in
2015-16. The under-spend from 2014-15 place funding will be added to the DSG, to
reinforce take up and develop other early years priorities.
5.5. Funding for Family advice & support / marketing of entitlement is deployed through
Hackney’s Family Information Service which amongst other activity plays a vital role in
supporting families to access childcare and free entitlements, collecting and collating
capacity and occupancy information, and running our marketing campaigns.
5.6. SEN, Portage; safeguarding, combating disadvantage. This budget covers support for
early identification and assessment for children under 5 and targeted resources for
those with high needs. Funding is used for places and additional support for individual
children to facilitate early assessment in schools and settings. This budget also targets
training and support in all relevant settings and provides a dedicated early years
safeguarding officer.
5.7. Quality improvement, curriculum support, workforce development. This is focussed on
increasing the number of children who access good and outstanding provision and on
supporting access for vulnerable children. Current priorities include supporting
improved quality in the independent school sector, where a large number of children
LONDON BOROUGH OF HACKNEY
HACKNEY LEARNING TRUST
Early Years Central Expenditure 2016-17
Page 5 of 7
access the free entitlement; narrowing achievement gaps for identified groups
(including through EYPP); brokerage and strategic management of partnerships with
Health.
5.8. Capacity building. LAs have a duty to ensure that there is sufficient childcare and early
learning provision for working parents and to deliver the free entitlements. This budget
supports the early years business support functions accessed by both schools and the
PVI sector.
5.9. Management, funding, data collection & compliance. This budget includes costs of
management and administration of the parts of the early years service related to
funding block activities, including strategic planning, financial and administrative
management of funding streams, processes and data collection and statutory
submissions. Monitoring fair access is an element of this function.
6. Early Years Performance and Improvement
6.1. The LA is committed to raising achievement and narrowing gaps at age 5 (Good Level
of Development, GLD). In July 2015, 67% of 5 year olds in Hackney achieved a GLD.
This is a 2% improvement upon Hackney’s 2014 GLD (Figure 1).
Over the past 6 years the number of children reaching a GLD has risen from 35% in
2009 to 67% in 2015. A significant part of this improvement is the result of the
activities delivered via services funded by the LA, with the support available to all
providers making effective use of the centrally retained DSG.
Figure 1- GLD, Hackney against national 2009-2014
6.2. A further aspect of the impact of local authority activity and support to early years
settings is the improvement in the quality of provision in Hackney. The percentage of
Ofsted good/outstanding registered childcare setting settings improved from 82% in
June 2014 to 86% in June 2015.
82% of childminders had been judged
good/outstanding in June 2015. There is significant work to be done within the
independent school sector, with 61% good/outstanding (June 2015).
LONDON BOROUGH OF HACKNEY
HACKNEY LEARNING TRUST
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Early Years Central Expenditure 2016-17
6.3. Activities supported by centrally retained DSG have been effective in contributing to a
consistent improvement in outcomes and the quality of provision in early years and will
continue to sustain this level of improvement. These involve:
 Targeted support for settings causing concern or ‘requiring improvement’, mirroring
the schools’ SRAS process, focussing both on educational outcomes,
safeguarding and welfare standards.
 Leading professional development networks (PDNs) across the sector within clustersincluding the schools’ EYFS Co-ordinators’ Forum, childcare setting PDNs and the
Interlink Partnership of providers from the Charedi community.
 Co-ordinating partnership working with schools, settings, SEN & Early Support,
children’s centres and health visitors
 Leading cross borough projects to identify and address achievement gaps
 Supporting innovations to develop outstanding practice, particularly around Early
Intervention and the Home Learning Environment, e.g. EYPP, REAL (Raising
Achievement in Early Literacy) and the Integrated Developmental Review (health &
education).
 Developing borough strategies for the Early Years Pupil Premium and new Reception
Baseline Assessment.
 Continuing to improve the proportion of good or better settings across the sector with
particular focus on the independent sector.
7.
Comments from other sections
7.1. Head of Management Accounts (HLT)
As demonstrated in the report, Early Years Block funding centrally managed by the
local authority is vital for ensuring that Hackney retains Early Years expertise and
works towards the continual improvement of provision across the borough.
7.2. Hackney Legal Services
The proposals for Early Years Central Spend are in accordance with the DFE School
Revenue Funding 2016-2017 Operational Guidance. The Schools Forum should note
whilst the proposals can be agreed in principal they are subject to the outcome of the
forthcoming DFE Spending Review.
8.
Implications for academies and free schools
All places are commissioned from providers on an equal basis. Academies and free
schools early years funding is allocated in line with our agreed funding formula.
9.
Conclusion
The local authority seeks agreement in principle for the proposed central spend levels
and that Forum notes the plans to sustain pupil achievement.
Report originator:
Ophelia Carter, Head of Schools Finance
Other contributors:
LONDON BOROUGH OF HACKNEY
HACKNEY LEARNING TRUST
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Early Years Central Expenditure 2016-17
Name
Designation
Section
Angela Scattergood
Head of Early Years
School Performance
and Improvement
Sara Walsingham
Grant Development Manager
Finance
Date cleared by –



Head of Business Services: 12 October 2015
Assistant Director, Finance (CYPS): 9 October 2015
Education Director & Head of Hackney learning Trust: 14 October 2015
LONDON BOROUGH OF HACKNEY
HACKNEY LEARNING TRUST