Why Some Councils Restrict Funded Provider Choice

Scotland's "Funding Follows the Child" model is built on a simple promise: your 1,140 funded hours should follow your child to whichever setting you choose, provided that setting meets the National Standard. In policy documents it reads as a fully portable, parent-led system. In practice it is messier. Some councils have long lists of partner providers; others have short ones. Some private nurseries take any funded child; others refuse outright. Some charge for "consumables" in ways that look suspiciously like top-up fees by another name.

This guide explains why the system works the way it does on the ground, what the Scottish Government's official position is on the contentious issues, and what you can do if your preferred setting is not a funded partner.

How partner-provider lists work

To deliver funded hours, a private or third-sector setting must:

1. Be registered with the Care Inspectorate
2. Meet the National Standard for Early Learning and Childcare Providers
3. Sign a funded-provider agreement with the council where the child lives

That agreement sets out the hourly rate the council will pay, the planning and reporting requirements, the inspection regime, and the terms around top-up fees and consumables. Each council negotiates its own agreement, although the National Standard itself is set centrally.

The cost-gap problem

The single biggest reason for restricted provider choice is the gap between what councils pay providers per funded hour and what those providers charge in the private market.

Typical figures across Scotland:

These are approximate ranges; specific figures vary by council and year. The gap means that for many private settings, a funded child generates significantly less revenue per hour than a private-paying child in the same room. The arithmetic gets harder if the setting also has higher overhead costs in city centres.

This is why some settings:

• Refuse to take funded children altogether
• Restrict funded sessions to specific (often less popular) time slots
• Cap the number of funded children they accept per session
• Sign up as funded partners in name only and prioritise private-paying families when offering places

What the Scottish Government says about top-up fees

The Scottish Government's position is unambiguous: top-up fees for the funded hours themselves are not permitted. A partner provider cannot charge parents to "top up" what the council pays. They cannot make accepting a place conditional on buying additional paid hours.

What providers can charge for is genuinely optional extras that fall outside the funded entitlement. The most common examples are:

• Meals beyond what the funded hours cover (where meals are not part of the entitlement)
• Specific outings, school visits or activities
• Consumables such as nappies and wipes
• Branded uniforms

These charges must be optional and not a condition of attending the funded hours. In practice, the line between "optional" and "expected" is often blurred. Some settings present a "consumables list" that ends up costing £20-40 per week — money that parents say feels like a top-up fee even if it is technically itemised differently.

If you feel a provider is charging in a way that breaches the National Standard, you can raise it with your council's Early Years team or with the Care Inspectorate.

Why some councils have shorter lists than others

Several factors influence how many partner providers a council has:

• The hourly rate the council pays — higher rates attract more providers
• The administrative burden — heavy planning, reporting and audit requirements deter smaller settings
• The local market — areas with many private nurseries (Edinburgh, Glasgow) tend to have more partner providers in absolute terms
• Local council culture — some councils actively recruit partners; others run a more closed, council-nursery-led model
• Capacity in council provision — councils with plenty of their own places have less incentive to expand partner lists

This is why a parent in Edinburgh may have 80+ partner providers to choose from while a parent in a rural authority has fewer than 10.

Finding your council's partner provider list

Every council in Scotland publishes its list, usually under "Early learning and childcare" or "Funded childcare partners." The list typically shows the setting name, address, age range, delivery model (term-time / stretched / both) and Care Inspectorate grade. Cross-reference with the Care Inspectorate register to check current inspection grades and registration status.

If your preferred nursery is not a partner

You have three realistic options:

1. Ask the setting if they will apply to become a partner. Some smaller settings simply have not done it. A friendly request from a parent can sometimes prompt action.
2. Choose a different setting that is a partner. This may mean compromising on location or specific features, but secures your 1,140 funded hours.
3. Pay privately at your preferred setting and use the funded hours elsewhere. A split placement allows you to use some funded hours at a partner provider while paying privately for sessions at your preferred non-partner setting.

There is no fourth option that lets you use funded money at a non-partner setting. The funding only flows through providers that have signed the council agreement.