Question to the Department for Education:

To ask the Secretary of State for Education, what steps her Department is taking to support the financial sustainability of nursery providers in the context of changes to free childcare entitlement.

The government’s Plan for Change sets out a commitment to give children the best start in life, breaking the link between background and opportunity. We want a record proportion of children (75%) to achieve a good level of development by the end of reception by 2028. By focusing on child development rather than just childcare, the government aims to ensure that children are better prepared for school and future learning.

In 2025/26 alone, we plan to provide over £8 billion for the early years entitlements. This is a more than 30% increase compared to 2024/25, as we roll out the expansion of the entitlements.

As announced at the Spending Review, the government will provide an additional £1.6 billion per year by 2028/29, compared to 2025/26, to continue the expansion of government-funded childcare for working parents. Employment Allowance is being increased to protect businesses by providing relief of up to £10,500 per annum on their employer Class 1 National Insurance contributions liabilities from 6 April 2025. Early years childcare providers are entitled to claim the Employment Allowance if they are private businesses or charities, and we expect the vast majority will be eligible to do so.