Question to the Department for Education:

To ask the Secretary of State for Education, what consideration her Department has given to paying national non-domestic rates on behalf of early years education settings.

It is our ambition that all families have access to high quality, affordable and flexible early education and care, giving every child the best start in life and delivering on our Plan for Change.

The small business rate relief scheme provides up to 100% relief for eligible businesses occupying one property with a rateable value of £12,000 or below and reduces bills up to £15,000. Furthermore, if a nursery is a charity, charitable rate relief provides 80% off rates bills, which can be topped up to 100% by the local authority.

The government funds local authorities to deliver the early years entitlements through the early years national funding formula for the three and four-year-old entitlement and a separate formula for the two-year-old and below entitlement. The hourly funding rate paid to local authorities for these entitlements is designed to recognise the average costs across different provider types and is intended to reflect staff and non-staff costs, including business rates. The national average three and four-year-old hourly funding rate of local authorities is increasing by 4.1%, the two-year-old hourly funding rate is increasing by 3.3%, and the nine months to two-year-old hourly funding rate is increasing by 3.4%.

There are no current plans to extend the centralised payment system to private, voluntary, or independent early years settings or to make these settings exempt.