Council's £6m nurseries funding cut blocked

Some early years providers could be forced to close if funding is cut, the Lancashire Schools Forum said

A powerful education body has voted to block a plan by Lancashire County Council to withhold £6m in funding that it currently gives to nurseries and pre-school providers.

The authority's proposed change would mean the loss of 400,000 nursery hours, the Lancashire network of the National Day Nurseries Association said.

Last month, the Reform UK-run council proposed retaining 3% of the cash, which it receives from the government to cover the cost of free childcare entitlements.

The Lancashire Schools Forum said the authority should continue passing on the full amount it receives to early years providers in its area, or some could be forced to close.

Childminders worse off

The proposed change in the county council area has drawn criticism from the operators who would see their direct funding cut by an average of more than £5,700, according to the authority's own figures.

Childminders would be, on average, £992 worse off, while other private, voluntary and independent sector providers would lose £9,972.

In its consultation, the county council noted the current cost of services that providers have to purchase for themselves – such as training – can cost up to £424 and act as "a barrier" to smaller operators.

This would be removed under the suggested overhaul, with such services being delivered for free by the local authority, using the retained cash.

One provider suggested that the changes would perpetuate "low rates of pay, high turnover of staff and demoralisation" in what was described by another operator as an "underfunded and struggling" sector.

Local authorities have previously been able to retain up to 5% of early years funding in order to deliver central services to providers, but that figure was reduced to 4% for the current financial year and will fall to 3% from April 2026 – the point at which Lancashire County Council wants to bring in the change and withhold what would then be the maximum amount permitted, the Local Democracy Reporting Service said.