Early years funding updates

Posted on 12 February 2026 in News and updates

Statutory guidance – April 2026 

On Monday 9th February 2026 the Department for Education released the Statutory Guidance Early education and childcare (valid from April 2026).

Local authorities have a legal duty to ensure that early years funded providers meet the requirements of the statutory guidance and that parents access the entitlements in the spirit that they are intended.

We are working through the document and will be making the necessary changes to our Provider Agreement in due course and this will include the changes regarding the Ofsted inspection outcomes. 

There is more detail in the Charging Section from A1.31 and we now have a Transparency Section A1.39 which supports the requirements for January 2026 as detailed in 2025.

We know providers have been making changes to their funding models, reviewing their private hourly fees, updating charging policies for Chargeable Extra’s, and moving to itemised invoices to ensure they are compliant for January 2026.

Providers must have a clear offer of where funded time can be accessed, what Chargeable Extras are provided and what options there are for parents that are unable or unwilling to pay.

We know that this has presented some challenges for some providers but thank you for your co-operation.

Parent queries and complaints

Over the past 12 months, we have seen a considerable increase in parent queries and complaints relating to the funding offer and chargeable extras.  Some of these queries were simply where information provided was not clear and transparent.  We have worked closely with a number of providers in Devon and reviewed funding models, charging policies and parent communications to ensure providers are meeting the requirements of the Statutory Guidance.  We have seen some positive changes to the funding offers that enables parents to access more funded hours which is making a real difference to families in Devon.  Websites and policies have been updated so that parents understand what is available.

However, having options for parents who do not want to access Chargeable Extras has been more challenging for providers, especially when it comes to food and activities.

It was felt that some of the options that were being offered by some providers were not reasonable and designed to make it difficult for parents to opt-out. They reported feeling pressurised into accessing and paying the charges which the DfE state must be voluntary.

We have explored various options with numerous providers and after discussions with Devon colleagues, senior managers, and other LA’s, we feel it is important for us to expand and clarify charges in our Provider Agreement as per A1.35:

Providers should be mindful of the impact of charges on families, particularly the most disadvantaged. Providers who choose to offer the free entitlements are responsible for setting a policy on providing parents with options for alternatives to additional charges. This policy must offer reasonable alternatives that allow parents to access the entitlement for free, including allowing parents to supply their own, or waiving the cost of these items.

Therefore, providers in Devon have two options for parents that want to opt out of food.

You can either:

  • Allow parents to bring in a packed lunch or
  • Provide children with your food offer free of charge

Packed lunches

You can set a packed lunch policy with foods you’d expect to be provided for the time a child is with you.  List foods that should be included for each meal/snack and what is not allowed due to allergies. You may want to reheat homecooked meals, you may not. You may ask parent to include an ice pack if you don’t have refrigerator space. Your packed lunch policy must be reasonable. This option comes with no cost to the setting but does require more considerations with allergies, storage and content.

Waive fees

Our funding formula includes a universal deprivation supplement on every funded hour. This funding can be used to offer a free lunch.  This may appear to be a suitable option if your parent requests have been low but do consider if this is financially manageable if more parents start to opt out. This option does enable the setting to continue operating lunches in the normal way but does need to be costed. You could do this as a temporary measure if requests are low and rethink the packed lunch options if requests increase.

We can confirm that it is not considered reasonable or acceptable to request:

  • Cooked meals only to be reheated
  • Hot food to be provided and remain hot in a flask for mealtimes
  • Foods or meals that match the settings menu or meal plan
  • Shop bought items in original packaging
  • Ingredients or shopping lists of food items that parents must supply
  • Parents to drop off meals at a different time to when the child arrives at the setting.

As part of our work with providers, some are reporting that they are waiving fees for children who are in receipt of the targeted 2-year-old funding (FRAS) or Early Years Pupil Premium. Some of these families may have returned to work after qualifying for these funding streams and do not lose eligibility. Other children could be in foster care where foster parents are paid an allowance that includes food or a child that has been adopted and their parents are not financially disadvantaged and could afford to pay for Chargeable Extras. Working parents who may qualify for the working entitlements are often not considered disadvantaged but could be more in need. We recommend that providers who have such a policy, urgently review the removal of additional charges to just these targeted families and consider all children and families that are in the setting.

Other feedback in relation to packed lunches are concerns relating to allergies, but this is not a reason to not allow packed lunches.  There are early years settings that have a mixture of packed lunches and cooked lunches, and next week we hope to share how they manage allergies at mealtimes that will hopefully support settings with their lunch plans. If you are a provider allowing packed lunches whilst managing allergies in your setting, and you’d like to share your practices, that would be appreciated.

Reminders of other requirements of the Statutory Guidance

For consistency, the DfE have the Chargeable Extras template. You cannot have a single daily charge and must set your fees under the following three headings:

  • Food: – meals, snacks, drinks
  • Consumables: – nappies, wipes, sun cream etc
  • Activities: – yoga, French, outings or events

These charges are voluntary and cannot be a condition of a child being offered a funded space.

You do not have to cost each individual meal/snack within your food charge, but you may have different charges for different ages, or if children are coming for different funded session times (depending on your model).  For example, a child doing an afternoon session would only access tea and not breakfast or lunch. The food charge would reflect what is provided within that session.

Parents must be able to purchase the Chargeable Extras they require, and this should be done as a termly arrangement. They can choose to access the food offer but not the Consumables or Activities.  There cannot be a requirement that parent’s access all or nothing.

If parents opt out of any Activities charge, the child must be offered an appropriate alternative EYFS activity. You must consider how you manage this within a room or across the setting depending on the number of children in each age range and the number of families that opt out.

Over the last 18 months there have been numerous Ombudsman reports and court cases where parents are not being offered their funded entitlements as intended and the LA has a duty to ensure Government Funding is allocated to providers that are compliant and meeting the requirements of the Statutory Guidance. The outcomes of investigations have resulted in LA’s being required to repay parent fees that have been charged, and LA’s recovering those payments from providers.

We don’t want Devon providers to be in this position and want to support you to make any necessary changes to be compliant.

Requirements for January 2026

As per the Statutory Guidance of 2025, providers were advised of new requirements that needed to be implemented by January 2026.

Itemised invoicing

Providers must have itemised invoices that allow parents to see that they have received their child’s entitlement hours completely free of charge and understand that any fees paid are for additional hours or optional chargeable extras.  Invoices and receipts should include the provider’s full details so that they can be identified as coming from a specific provider.

Providers must break down their charges and fees separately into:

  • the free entitlement hours
  • additional private paid hours
  • food charges
  • non-food consumables charges
  • activities charges

If due to software suppliers this is delayed, it is acceptable for this level of detail to be included in the parent contract that confirms the total weekly charge and how that is calculated for any invoices.

Transparency

The costs of chargeable extras must be published on provider websites or, where they do not have a website, on local authority Family Information Services. These should be clear, up-to-date and easily accessible to parents, to enable parents to make an informed choice. They should set out, for each setting, the amounts for all chargeable extras listed, as well as the pattern of hours that parents can take the entitlements.

The statutory guidance say that local authorities may exempt childminders and providers caring for 10 or fewer children at any one time. However, we treat all providers equally and therefore this is a requirement for all funded settings.

Online teams meetings

We want to support providers in Devon and have some online sessions booked to discuss some of the topics in the Statutory Guidance as follows: 

We will plan some evening sessions as well after half term and share these with providers next week.