A new report on education spending warns that the early years sector is likely to be ‘increasingly squeezed’ as higher-than-expected inflation erodes the increase in free entitlement funding.
The IFS report, published today (12 December), estimates that total spending on the ‘free’ entitlement will ‘buy’ 9 per cent less in 2024-25 compared with 2021-22. This is despite a planned £170 million boost to funding by 2024.
The economic research institute warns that ‘virtually all of this squeeze is yet to be felt’.
Within its fifth annual report on education spending, funded by the Nuffield Foundation, the IFS states that ‘Childcare providers are currently experiencing faster rises in costs than overall levels of inflation’, and mentions recent rises in the national living wage pushing up costs.
