Unlocking Opportunities for Scotlands Little Learners: Key Changes to Early Learning and Childcare Eligibility

The Scottish Government is set to update the rules around eligibility for funded early learning and childcare (ELC) for two-year-olds, ensuring that more families can benefit from this crucial support. Here's what you need to know about the changes coming into effect in 2025.

Why the Change?

The upcoming amendment to the Provision of Early Learning and Childcare (Specified Children) Order 2014 is designed to align with the increase in the National Living Wage, which is rising from £11.44 to £12.21 per hour starting April 1, 2025. This adjustment will help ensure that families on Universal Credit who are working 16 hours a week at the National Living Wage continue to qualify for funded ELC. The income cap for these families will be raised from £796 to £850 per month, safeguarding access for those who might otherwise lose out as wages increase.

Phasing Out Tax Credits

As part of a broader shift in UK government policy, working tax credits and child tax credits will no longer be considered qualifying benefits for ELC eligibility from April 6, 2025. This change coincides with the end of tax credits on April 5, 2025, due to the ongoing transition to Universal Credit.

Protecting Access to Early Learning

The Scottish Government's goal is to maintain the current level of access to funded ELC, ensuring that the same number of children can benefit despite changes in benefit structures. By adjusting the income threshold, the government aims to keep the pool of eligible families stable, preventing any significant drop in the number of children qualifying for this vital service.

Impact and Consultation

These changes are not expected to have a discriminatory impact on any group based on age, disability, race, religion, sex, sexual orientation, or gender reassignment. Furthermore, they are not anticipated to impact children's rights or wellbeing adversely. The changes are designed to maintain the status quo, with no expected financial impact on local authorities or private ELC providers.

Keeping an Eye on the Future

The Scottish Government plans to review the income thresholds annually to ensure they continue to reflect changes in the National Living Wage, thereby upholding the level of support available to families across Scotland.

In summary, these updates aim to ensure that Scotland's youngest learners have continued access to the benefits of early education, supporting families as they navigate the transition from tax credits to Universal Credit.