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Early Years Education Funding for 3 and 4 year olds

The Early Years Education Funding scheme offers free nursery education sessions for three and four year old children and is particularly attractive since:

  • the grant is available to all children regardless of household income.
  • claiming the money is virtually painless!

Funding for 3 and 4 year olds

All children are entitled to receive free nursery education before they enter compulsory education at the age of five. The sessions are paid for the nursery education provider's Local Education Authority (LEA). They receive their money from central government funds. Moorland Nursery School's LEA is Staffordshire (although many of our children reside is Stoke-on-Trent).

Early Years Education funding becomes available to children from the term following their third birthday. For the purposes of the funding scheme terms start on 1st January (Spring), 1st April (Summer) and 1st September (Autumn).

There are a number of rules regarding Nursery Funding which include:

  • Parents have the right to choose where they spend their children's funding money. This may be at any approved private, voluntary or state sector Nursery Education Provider. All Registered Providers are subject to periodic inspection by the Office for Standards in Education (Ofsted).
  • Registered Providers should be able to offer five 2.5 hour educational sessions per week for 38 weeks per year at no cost to parents. As a parent, you do not have to use all five, nor do you have to use them all in one establishment unless you wish to.
  • Funding may only be used for Educational sessions.
  • You don't need to use all of the five sessions. If you use less the amount of reduces proportionately.
  • A Registered Provider's educational programme must receive at least two hours input from a qualified teacher each term. Staffordshire LEA uses advisory teachers to spend two hours each term with those Day Nurseries, Playgroups, etc. that do not employ a teacher.
  • Funding money may cross LEA boundaries if both LEAs involved are in agreement. Staffordshire and Stoke-on-Trent's Councils have agreed that funding money may cross boundaries freely. This means that a child living in Stoke-on-Trent may spend his/her funding money in a Staffordshire Nursery or vice versa.
  • The DfES is keen that parents exercise their right to choose the Education Provider they feel will be best for their child. [Many primary schools have nursery units, especially so in Stoke-on-Trent. Schools are not permitted to give their nursery children preferential treatment when they apply for entry to reception class]

From the end user's view point, the scheme is very simple. Parents must:

  • provide the nursery school with a copy of their child's birth certificate
  • sign a form each academic term to confirm their child's name, date of birth, postcode and the number of sessions attended.

That's it! Your annual fees reduce by a just over 1500 (at the rate set for the 2006 financial year).


It is worth noting that since early education funding reduces your childcare costs it may impact on your tax credit entitlement. If you are eligible for the childcare element of working tax credit the amount to which you are entitled could reduce.

23rd March 2006

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