Early years funding: key changes to the local funding rules for 2026 to 2027

To support local planning, we can confirm the following key changes to the local funding rules for 2026 to 2027, ahead of the annual funding rates publication:

• From 2026 to 2027 we will move to a 97% minimum pass-through requirement.

• From 2026 to 2027 we will also be updating the schools and early years finance (England) regulations so that 28 February will be the new statutory deadline for local authorities to confirm local funding rates for providers. This moves the expectations, as set out in 2025 to 2026 operational guidelines, on to a statutory footing.

• We also want to highlight our recent announcement on 4 June 2025 DfE Update that we are changing the early years census from an annual to a termly census for 2026 to 2027.

• National funding rates for 2026 to 2027 will be confirmed in autumn 2025. We expect these rates to be published to similar timelines as recent years, to ensure they can account for key information that will become available in autumn 2025.