Two, three and four year old funded providers

Information for providers on early education funding for two, three and four year olds.

All three and four year olds and some two year olds are entitled to free early education and childcare of 15 hours per week, 38 weeks per year, 570 hours per year. Children are able to access the free early education entitlement the term after their second or third birthday.

From September 2017, eligible three and four year olds will be entitled to 1,140 hours per year (30 hours a week term time).

If you are a new childcare provider, you can apply to become a funded provider for two, three and four year olds.

If you are an existing provider, further information and downloadable documents are available below.

Who is eligible for early years funding?

Two year olds

A two year old can get free early education and childcare if they live in England and if the parent/carer gets one of the following:

  • Income Support
  • income-based Jobseeker’s Allowance (JSA)
  • income-related Employment and Support Allowance (ESA)
  • Universal Credit - if you and your partner have a combined income from work of less than £15,400 a year after tax
  • tax credits and you have an annual income of under £16,190 before tax
  • the guaranteed element of State Pension Credit
  • support through part 6 of the Immigration and Asylum Act
  • the Working Tax Credit four-week run on (the payment you get when you stop qualifying for Working Tax Credit)

A child can also get free early education and childcare if any of the following apply:

  • they’re looked after by a local council
  • they have a current statement of special education needs (SEN) or an education, health and care (EHC) plan
  • they get Disability Living Allowance
  • they’ve left care under a special guardianship order, child arrangements order or adoption order

Two year old children in low income families are now able to take up a free place when their parent(s) have one of the following types of immigrations status:

  • Zambrano carer (derivative right to reside in the UK under European law as the primary carer of a British child or dependent adult)
  • Leave to remain with no recourse to public funds (NRPF) granted on family or private life (Article 8) grounds
  • Been refused asylum in the UK and receiving support from the Home Office under section 4 [2] of the Immigration and Asylum Act 1999
  • Parents who are Zambrano carers or who have leave to remain with NRPF, must also be able to demonstrate that they have a low income.

Parents must apply and check their eligibility for the two year old entitlement using an online application form.

Or face to face support is available from the Gateway Centres and by telephone 0161 778 0384 Option 2.

Children are eligible to receive the early years funding from the start of the term after their second birthday until the child qualifies for free funding as a three year old, even if the family’s circumstances change. 

Parents cannot apply before the start of the funding period in which the child’s second birthday occurs.

Following a successful application, the childcare provider will need to see a Salford eligibility voucher before a funded place can be offered. Please note the only evidence you can accept to offer a funded place is the Salford eligibility voucher. You are not able to accept a reference number or code or another local authority’s confirmation. Any parents who cannot produce the Salford eligibility voucher should be asked to contact the Starting Life Well service on 0161 778 0384 or email

Three and four year olds

Free early education and care available to all three and four year olds the term after their third birthday until they start reception class.

15 hours per week 38 weeks per year is available and this can be stretched out to include holiday periods - although this can only be done from the beginning of each new term.

Parents/carers should contact their chosen nursery/childminder to arrange a place.

Extended Entitlement for three and four year olds - 30 hours

A three or four year old can get the extended entitlement of up to 1,140 hours of funded childcare, if the parents meet the following criteria:

  • They earn or expect to earn the equivalent to National Minimum or Living wage over the coming three months
  • This equates to £120 a week (or c. £6,000 a year) for each parent over 25 years old or £112 to £180 a week (or c. £5,800 a year) for each parent between 21 and 24 years old.
  • This applies whether you are in paid employment, self-employed or on zero hour’s contract.
  • The parent (and their partner where applicable) should be seeking the free childcare to enable them to work.
  • Where one parent meets the income criteria and the other is unable to work because they are disabled, have caring responsibilities or have been assessed as having limited capability to work.
  • Where a parent is in a ‘start-up period’ (i.e. they are newly self-employed) they do not need to demonstrate that they meet the income criteria for 12 months.
  • If a non-EEA national, the parent must have recourse to public funds.

Parents must apply for the extended entitlement hours through the Childcare Choices website.

If parents are eligible, they will receive an 11 digit code to take directly to a participating childcare provider. Childcare providers must then gain written permission to verify the code with the local authority (parent agreement form below).

Once verified, a place can be confirmed for the funding period.

The entitlement is available over 38 weeks, term time only, or taken over the entire year, e.g. to include holiday periods too, flexible or stretched.

Parents should apply when the child turns three to ensure government funding is available the following term.

Further information

Early Years Pupil Premium (EYPP)

The Early Years Pupil Premium (EYPP) is additional funding for early years providers to enhance the education they provide for disadvantaged three and four year olds.

Children must receive free early education in order to attract EYPP funding. They do not have to take up the full 570 hours of early education they are entitled to in order to get EYPP.

Providers will receive an additional 62p per hour, applicable to 15 hours universal funding for eligible three and four year olds.

Providers must submit data on parent/carers, including their name, date of birth and national Insurance or NASS number for a check to be done. This data is submitted via the Capita Provider headcount portal. Data can be gathered via the parent declaration form (below).

Get more information on the Early Years Pupil Premium (EYPP) and how to claim this additional funding.

Offering funding

Provider funding agreement 2018/2019 (downloadable document below) 

The agreement for the funding of free early years provision for two, three and four year olds sets out the expectations between Salford City Council and the provider and refers to early years provision free of charge (sections 7 and 7A of the Childcare Act 2006) and free childcare (section 2 of the Childcare Act 2016) as the ‘free entitlement(s)’ or ‘free hours’ or a ‘free place’.

This agreement has been written using guidance from the:

  • Early education and childcare; statutory guidance for local authorities (June 2018)
  • Early years entitlements: operational guidance for local authorities and providers (June 2018)

and is based on the:  

  • Model Agreement: Early Years Provision free of charge and free childcare (June 2018)

Documents are available at the bottom of the page. 

The agreement applies to the 15 hours entitlement for the most disadvantaged two year olds, the 15 hours entitlement for working parents of three and four year olds (the universal entitlement) and the additional 15 hours entitlement for working parents of three and four year olds (the extended entitlement, 30 hours).

In addition to these:

  • Disability Access Funding (DAF) and Early Years Pupil Premium (EYPP) are available for three and four year old children who are eligible. 

The Provider funding agreement is for:

  • Local authorities
  • Early years providers registered on the Ofsted Early Years register;
  • Childminders registered with a childminder agency that is registered with Ofsted;
  • Independent Schools and Academies taking children age two and over and which are exempt from registration with Ofsted as a early years provider. 

The parental agreement (downloadable document below) is for:

  • Early years providers
  • Parents

The council and the provider have agreed to enter into this agreement in order to provide free entitlement places for two, three and four year olds.

How much will I get paid for providing the Early Years Funded childcare?

Early years providers are funded to provide childcare at the following rates:

Two year old funding: £5.34 per hour

Three and four year old funding:

The average hourly rate for three and four year old funding is £4.72 (dependent upon supplements paid)

Each childcare setting is provided with their hourly rate and indicative budget at the start of the financial year, April.

Rates and supplements:

Base rate: £4.32 per hour 


Deprivation: Calculated using the average IDACI score for all children attending each setting

Band Percentage Supplement
Band 1 0% - 25% £0.00
Band 2 25% - 30% £0.10
Band 3 30% - 40% £0.12
Band 4 40% - 50% £0.16
Band 5 50% - 60% £0.19
Band 6 60% - 100% £0.22


Graduate Leader Supplement: £0.25p 

Applicable if a member of staff holds a level 6+ qualification (degree level) in childhood studies and works with eligible funded three and four year olds within the provision for a minimum of 15 hours per week, 38 weeks per year.

Qualified Teacher Status (QTS): £0.30p

Applicable if a member of staff holds a Qualified Teacher Status qualification in early years or primary and works with eligible funded three and four year olds within the provision for a minimum of 15 hours per week, 38 weeks per year.

EYPP funding: £0.62p/hour applicable to 15 hours universal funding for eligible three and four year olds

Can I offer Early Years funding?

To offer the Early Years funding for two, three and four year olds a provider must be:

  • An early years provider other than a childminder registered on the Ofsted Early Years register;
  • A childminder registered on the Ofsted Early Years Register;
  • A childminder registered within a childminder agency which is itself registered with Ofsted or;
  • Schools taking children age two and over and which are exempt from registration with Ofsted as an early years provider

What do I need to do?

  1. Agree to the terms and conditions set in the funding agreement annually.

Each term you will need to:

  1. Check that children are eligible for the Early Years Funding and complete a parental agreement form with parents. The parental agreement provides you and the parent with a document which clearly shows the agreed hours or sessions that the child should attend and the notice period to be served. This helps to protect everyone if there is a dispute, particularly one that involves money. 
  2. Complete a headcount claim through the Provider Portal
  3. Make amendments for any children that have joined or left during the term
  4. Inform Starting Life Well service if you are unable to meet the conditions of the agreement. This will not necessarily affect the continuation of the service and Salford City Council may be able to offer support to enable it to continue. 

The parent contract form, which is available to download below, is to be completed with the parent and for your records; it does not need to be returned to the service. The timetables, which are also available to download below, contain two tabs, one showing the timetable and the second tab has key dates for processing the two, three and four year old funding via the Provider Portal.

Related children

Early education and childcare provision is defined in the Childcare Act 2006. This definition of childcare specifically excludes care provided for a child by a parent or step-parent (or other relative). 

As set out in section 18(4) of The Childcare Act 2006, a relative includes:

  • a parent or step-parent of the child
  • a person with parental responsibility for the child
  • a relative of the child, including a grandparent, aunt, uncle, brother or sister, whether of the full blood or half blood or by marriage or civil partnership (e.g. a stepbrother, stepsister and uncle/aunt/grandparent through marriage)
  • a person who is a local authority foster parent in relation to the child
  • a person who is a foster parent with whom the child has been placed by
  • a voluntary organisation
  • a person who fosters the child privately.

What to do if a two, three and four year old funded child stops attending a setting

Please complete the two, three and four year old funding non-attendance form

Early Years Census Return (annual return)

The Early Years Census return (EY Census) is an annual return which has to be completed every January. The Department for Education (DfE) requires every Childcare Provider who is claiming funding for a two, three or four year old to complete this return. The EY Census return is in two parts. 

Part 1 is Child Data which is collected via the Provider Portal Headcount module and

Part 2 is Establishment Data which is also collected via the Provider Portal Self Update Module.

Full guidance is issued annually (mid December). A guide is available to download below. 

Please note a childcare provider who is on the approved funding list is only required to complete the Early Years Census Return if they have or will have a funded child.

Who to contact

For further information or advice, please email the Starting Life Well team at You can also call 0161 778 0384.

Government guidance

Scan Zone

Scan Zone

Upload your evidence to the Starting Life Well service, such as a DLA eligibility statement, Universal Credit statement or funding forms and agreements. You can do so by visiting one of our Scan Zones. Scan Zones are located in all the Gateways and Broughton Hub, they are touch screen, tablet devices that allow customers to self-scan documents.

Read more about Scan Zones

This page was last updated on 11 May 2023

Rate this page