Nursery World - At least £70m of early years funding not spent by councils

At least £70m of early years entitlement funding was underspent in council budgets and not spent on places during the 2022-23 financial year – a record amount, according to new analysis.

The NDNA asked councils whether they had under or overspent their early years funding in 2022-2023, PHOTO: Adobe Stock

Just 12 per cent of councils said they later passed any of their leftover budget to providers to help with underfunding, finds the research carried out by the National Day Nurseries Association (NDNA).

The rest of the money was either put into reserves or used to offset other deficits within the Designated Schools Grant (DSG).

In total, 104 local authorities reported an underspend out of the 137 that responded to the NDNA’s Freedom of Information (FOI) request, equivalent to 76 per cent of councils. Almost a quarter (25 councils) reported underspends of more than £1m each.

Essex reported the largest underspend with £4.9m left over at the end of the year 2022-23. It said it had passed on some money to providers.

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