Commentary on Sections Early years  provision: budgetary framework Section 202: Free of charge early years provision: budgetary framework: England
645.This section amends the school funding provisions in the School Standards and Framework Act 1998 (“the 1998 Act”). It enables an authority’s “individual schools budget” (its “ISB”), from which schools are funded, to include funding for early years providers (EYPs) who will receive funding in order to provide free early years provision (childcare for a child up to the 31 August following their fifth birthday, as defined by section 20 of the Childcare Act 2006). It also makes provision for regulations similar to the Schools Finance Regulations to apply to allocations to EYPs.
646.Subsection (2) amends section 45A of the 1998 Act (determination of specified budgets of LEA), by inserting a new subsection (4B) into that section, so as to provide that the duty imposed on a local education authority by section 7(1) of the Childcare Act 2006 (to secure prescribed early years provision free of charge) is to be treated as imposed on the authority acting in their education capacity. Childcare (as defined in section 18(2)) of the Childcare Act 2006 includes not only education for a child but also any other supervised activity for a child, whereas section 45A of the 1998 Act and other provisions in Part 2 of that Act, apply only in relation to a local authority in their capacity as an LEA and will continue to do so, even when the concept of a “local education authority” is removed from legislation. In order to enable local authorities to fund EYPs out of their ISBs under section 45A, the duty imposed by section 7 of the Childcare Act 2006 — which goes beyond securing education for a young child — must be "treated" as though it were an education duty.
647.Subsection (3) inserts a new section 47ZA into the 1998 Act (free of charge early years provision outside a maintained school: budgetary framework), which:
	applies where a local education authority propose to allocate money to a childcare provider (other than a maintained school), for the purpose of discharging the authority’s duty under section 7 of the Childcare Act 2006, out of their ISB (subsections (1) and (3) of the new section). This duty is to secure sufficient childcare free of charge in accordance with regulations which set out the type of childcare and the age of the children to which it is to be provided.
	requires the amount allocated to be determined in accordance with regulations (subsection (2)), which will be subject to the negative resolution procedure;
	specifies particular matters to which the regulations may relate (subsection (4)). These matters mirror, where appropriate, those referred to in section 47(2) of the 1998 Act (which enables regulations relating to the amount to be allocated by the authority to maintained schools out of their individual schools budget to make provision for specific matters).
648.Subsection (4)(a) and (b) provides that the regulations may set out factors that authorities must, or must not, take into account in determining the amount of money to be provided to a childcare provider.
649.Subsection (4)(c) specifies that the regulations may set out other requirements that the authority has to comply with in determining the amount of money to be provided to a childcare provider.
650.Subsection (4)(d) specifies that the regulations may make provision about consultation in connection with determining the amount of money to be provided to a childcare provider.
651.Subsection (4)(e) specifies that the regulations may allow a local education authority to determine the amount of money to be provided to a childcare provider in accordance with arrangements that the Secretary of State has approved, rather than in accordance with regulations made under section 47ZA. In this case the regulations must set out the circumstances and extent to which this is permitted.
652.Subsection (4)(f) specifies that the regulations may require local authorities to give certain information to providers about how the amount was calculated.
653.Subsection (4)(g) specifies that the regulations may make provision about when a local education authority must recalculate such an amount.
654.Subsection (4)(h) specifies that the regulations may set out a time by which a local education authority must determine an amount. Subsection (5) defines certain terms for the purposes of the new section.