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Early Learning Centres Funding Issues For Highland Council

1st October 2022

An article at the Press and Journal (29 September 2022) reported by Nicola Sinclair on Early Learning Centres shows that major headaches on funding are hitting the council that has an increasingly devastating gap in resources required.

The article -
Highland Council looks set to be recalled for a special meeting to discuss the funding it provides to nurseries.

Conservative councillor Helen Crawford has filed a notice of requisition requesting a meeting of the full council.

She says Highland nurseries "deserve a full hearing" of the facts.

Under council standing orders, a requisition notice needs 18 signatures to succeed.

At the time of writing, Ms Crawford has 22 signatures, with more possible.

The council now has 14 days to hold a special meeting.

Read the full article HERE

The council meeting on 22 September 2022
10.
Early Learning and Childcare (ELC) Partner Sustainable Rate Review
10.1
Funded ELC of 1140 hours per annum, is delivered across the Highlands through a combination of Council settings, partner and childminder provision. The Council has circa 51 funded ELC partner providers plus 28 Commissioned Childminders, and an annual budget of £7.5m for payments to these providers.
10.2
Scottish Government issued guidance relating to ‘Partner Sustainable Rates' as part of their wider ‘Funding Follows the Child' policy framework for ELC. That guidance had an expectation that Scottish Councils would review the funding rates paid to ELC providers and using the guidance document as a framework. The expectation was that the outcome of that review, and revised funding rates would be effective August 2022.
10.3
Some of the key principles set out within the Scottish Government guidance are as follows:-
•the rate paid to funded providers should be sustainable and affordable by theLocal Authority whilst meeting the following:-
oto support delivery of a high quality ELC experience for all children.
oa rate that reflects the cost of delivery, including the delivery of nationalpolicy objectives.
oallow for investment in the setting - staff, resources and physicalenvironment.
oenable payment of the real Living Wage for those childcare workersdelivering the funded entitlement
10.4
The Council had been working with a small working group of partner representatives, and reviewing data output from a national survey of partners, led by the Improvement Service, to inform the review.
10.5
In November 2021, the Education Committee agreed to an interim uplift in the hourly rate of funded ELC from £5.31 to £5.43 (a 2.3% increase) effective August 2021. This was in recognition of the pay and inflationary pressures faced by providers at that time, and with the review not at that stage concluded. This was with an expectation that a final review outcome would be reported to members this Autumn, to formally conclude the review and the funding rate to apply from August 2022 onwards.
10.6
As set out within this report, the financial crisis facing the Council has entirely changed the context within which the ELC review was being taken forward. Scottish Government guidance explicitly recognises that the rate paid needs to be "sustainable and affordable by the Local Authority", and in the current financial climate any increase beyond the current rate paid would put an unaffordable recurring pressure on Council budgets.
10.7
In light of the financial crisis, the current hourly rate of £5.43 will continue to apply for August 2022 onwards (along with the existing supplement of £0.70 for 2 year old provision and £2.30 per meal provided). At that time the uplifted Highland rate compared to a Scottish average of £5.44. Further discussions will continue as the financial context unfolds and as with all partners expectations regarding reducing costs, reducing energy usage and measures to support staff sustainability will be a focus of engagement.

Read the full paper entitled
Financial Crisis - Our Council and Our Communities

This paper outlines the financial problems facing Highland council and suggest there will be use of reserves to alleviate some of the issues but this cannot go on indefinitely. The paper also points to big reductions required in staff numbers that they hope will happen by natural wastage.

Capital spending will be reduced as more money will be required to cover interest payments as they are increasing.

All areas of the council will be affected with projected budget gap for 2023/24 of over £40 million.