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The early years sector is undergoing rapid policy changes that impact both the sustainability and quality of childminding provision for babies. In this blog post, we reflect on two of the most pertinent policy changes impacting childminders working with children under two year olds: the expansion of the government-funded entitlement offer to 9-month-olds and changes in tax policy for childminders. 

The expansion of the funded entitlement to babies

As of September 2025, the English government completed their expansion of the funded entitlement offer to children from 9 months old whose parents meet the eligibility criteria. As a result, the sector as a whole is seeing increased demand for places for babies. Childminders have been partially shielded from an abrupt increase as they can only take one child under one year old and up to three children under age five, barring exceptional circumstances (DfE, 2025). However, the funding itself has made a massive impact.

As childminders inherently deliver mixed-age provision, the differences in funding for different ages matters significantly. The average funding rate is highest for children under two years old at £11.54/hour. At two years of age, the average funding rate drops to £8.53/hour, and there’s an even larger drop when children turn three years old to £6.12/hour (Coram PACEY, 2025a). This means childminders take a financial hit as children grow older, leading many to question if they should only offer provision to children under three years old. This line of questioning varies significantly from setting to setting, with some holding strong in their commitment to offer continuity of care to children as they age. Others are indeed shifting the structure of their provision to focus only on babies. This raises questions about sustainability for childminders, and how continuity of care will unfold as children age. 

Moreover, if more childminders will focus on under-threes, it makes it very important to ensure the qualifications and CPD they access have a strong focus on babies. From the baby room project, we learned that most qualifications have a ‘baby knowledge gap’ where child development for babies is not prioritized; there is also a gap in the amount of baby-specific CPD available to the sector (Sakr, Bonetti, and Halls, 2025). If childminders become more and more focused on under threes, it’s important that these gaps are bridged to ensure quality provision.

Changes in tax policy for childminders

Since 1986, the wear-and-tear allowance has allowed childminders to deduct 10% of total childminding income to cover the wear-and-tear of household furnishings for tax purposes (HM Revenue & Customs, 2026). However, it has been confirmed that childminders who shift to Making Tax Digital will no longer be able to claim this, and instead ‘will now only be able to claim relief on specific purchases and expenses, rather than benefiting from a blanket allowance that has long acknowledged the reality of their operating model’ (Coram PACEY, 2025b). This has worried some childminders about increased administrative burden with already minimal time, and increased financial burden within already tight parameters. 

This change surfaces serious questions around how to maintain quality for babies while juggling sustainability. Moreover, childminding organisations have wondered if this shift in tax policy will lead to a further drop in childminding numbers, impacting the spots available for babies and families. It becomes difficult to focus on rich discussions of quality when we are worried about the availability and sustainability of places.

What are your thoughts on the impact of these changes for babies? Share your reflections in the comments below.

*As a note, the content of this post is not financial advice. It is a reflection on how policy changes are impacting quality provision for babies.

References

Coram PACEY (2025a) Almost 3,000 childminders call for early years funding reform in England. Available at: https://www.corampacey.org.uk/almost-3000-childminders-call-for-early-years-funding-reform-in-england/ 

Coram PACEY (2025b) An update on Making Tax Digital for childminders. Available at: https://www.corampacey.org.uk/update-making-tax-digital-for-childminders/ 

Department for Education (2025) Early years foundation stage statutory framework: For childminders. Available at: https://assets.publishing.service.gov.uk/media/6874e14383d39f474eb7d373/Early_years_foundation_stage_statutory_framework_for_childminders_.pdf 

HM Revenue & Customs (2026) BIM52751 – Care providers: childminders: expenses. Available at: https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim52751

Sakr, M., Bonetti, S. & Halls, K. (2025) Opening the Door to the Baby Room: Learning from the Experiences and Perspectives of Baby Room Educators and Nursery Managers. Available online: www.thebabyroom.blog/report-2