Question to the Department for Education:

To ask the Secretary of State for Education, with reference to his Department's publication entitled 30 hours free childcare: evaluation of the national rollout, published on 11 September 2018, support his Department plans to provide the 39 per cent of childcare providers who took part in the evaluation and reported a reduction in their profit or surplus due to the extended hours.

By 2019-20 we will be spending around £6 billion on childcare support – a record amount. This includes around £1 billion extra a year to deliver 30 hours of free childcare and fund the increase in hourly rates that we introduced in April 2017. Our average funding rates are based on the department’s ‘Review of Childcare Costs’ which was described as “thorough and wide ranging” by the National Audit Office.

More than 340,000 children have benefitted from our 30 hours offer over its first year.

The childcare market is a mixed economy and different providers have different business models. Providers do not have to offer the 30 hours entitlement if they do not wish to. This year one evaluation demonstrates that, of the sample of providers offering 30 hours, the majority either had no change in their profit or surplus or actually increased their profits. The latest Ofsted data from March 2018 showed that the number of non-domestic providers has remained stable.

We have worked with early years partners to provide materials and support to help childcare providers remain sustainable and develop their businesses. In addition, earlier this year we allocated a total of £7.7 million to 147 local authorities through our Delivery Support Fund. This funding was to support authorities to work with their local providers to ensure sustainable delivery of 30 hours and included funding to provide specific business support.

We will use the findings from the year one evaluation to support future delivery of 30 hours. This month we announced a year extension to our Childcare Works contract and will continue to work with them to support local authorities and childcare providers to deliver the government entitlements, including 30 hours free childcare.

We are currently undertaking work to review delivery costs and this report is another useful addition to our evidence base.