Funded childcare hours for childminders: how it works

Who can offer funded hours

To offer government-funded childcare hours in England, a childminder needs to be registered on the Early Years Register with Ofsted and have a current provider agreement with their local authority. The local authority administers the funded entitlements locally, so the details of claiming, auditing and delivery can vary from area to area.

Funded hours are not the same as tax-free childcare or childcare vouchers. The government-funded entitlements include universal hours for some age groups and extended hours for eligible working parents. At the time of writing, the offer has been expanding, so check the current eligibility age range and number of hours on GOV.UK before advising parents.

How the local authority provider agreement works

Each local authority has its own provider agreement. It sets out the terms you must meet to deliver funded places. Common requirements include:

• Being registered on the Early Years Register
• Holding suitable insurance
• Meeting any local training or induction requirements
• Completing claims and audits using the local authority's system
• Keeping accurate attendance records
• Working with parents to verify eligibility
• Not charging a top-up for the funded hours themselves

When you sign the agreement, you agree to be audited. Local authorities can ask to see attendance registers, parent declaration forms, eligibility codes and invoices. Keep these organised and easy to find.

What to tell parents

Parents can sometimes feel confused about how funded hours work, especially when they also use paid hours or wrap-around care.

Explain clearly:

• Funded hours cover childcare time, not optional extras such as meals, nappies, trips or late collections.
• You cannot charge a top-up to access funded places, but you can charge for extras if your contract says so.
• Parents may need to provide an eligibility code for extended hours and reconfirm it when the local authority asks.
• Funded hours can sometimes be split across more than one provider, but there are limits. Check local authority guidance.
• Absence rules differ, so tell parents what happens if a child is ill or on holiday during funded time.

Paperwork to keep

Keep a clear paper trail for every funded child. Useful records include:

• Parent declaration or funding agreement
• Eligibility code and date checked
• Attendance register showing hours and sessions
• Invoices showing funded hours and any chargeable extras
• Copies of claims submitted to the local authority
• Audit evidence such as parental confirmation emails or messages
• Contract showing funded hours, paid hours, notice period and extras

If you use a software system, keep exporting or saving copies. Local authority audits can happen after several months, and reconstructing records is stressful.

Quick checklist

• Confirm you are on the Early Years Register and have a current provider agreement
• Check the current funded entitlement for each child's age on GOV.UK
• Collect and verify parent eligibility codes before the claim deadline
• Record actual attendance, not planned hours
• Submit claims on time using the local authority system
• Separate any extras invoices from funded hours
• Store declarations, codes and registers for the required retention period
• Review your contract wording with parents so funded and paid hours are clear

If you want a quicker way to check your paperwork before a funding audit, Policy & Play offers editable, Ofsted-ready policies and a free AI assistant called Polly at Try Polly. Polly can help answer questions about wording, but you should confirm local funding rules with your local authority.

FAQs

Can I offer funded hours if I am registered with a childminder agency?

You generally still need to be registered on the Early Years Register and hold a local authority provider agreement. Check with your local authority because some areas may have additional conditions for agency-registered childminders.

Can I charge parents a top-up for the funded entitlement?

No. You cannot charge a top-up to access funded hours. You can charge for optional extras such as meals, outings, nappies, late collection and additional hours outside the funded entitlement.

Do funded hours have to be taken during term time only?

This depends on your local authority and your agreement. Some childminders can offer stretched hours across the year, including school holidays. Check your local terms before agreeing with parents.

What happens if I make a mistake in a funding claim?

Co-operate with your local authority and correct the record. Overpayments may be recovered, so keep evidence of attendance and report errors as soon as you notice them.