The inclusive early years fund is £47 million of additional funding for 2026 to 2027. Local authorities must pass it to eligible early years providers, including eligible school nursery provision, to strengthen inclusion across the whole setting.
The important bit is how it works. Providers do not apply through a panel. The money should arrive upfront, it is not tied to a named child, and it must not replace special educational needs inclusion funding, disability access funding or high needs funding.
That gives settings room to act earlier. It also creates a straightforward responsibility: decide what will improve inclusive practice, spend the money by 31 March 2027, and keep enough evidence to explain the decision.
The Department for Education published final allocations and updated its guidance on 22 July 2026. Payments to local authorities are due at the end of July.
What is the inclusive early years fund?
The inclusive early years fund, usually shortened to IEYF, is additional funding for providers delivering the government's free early years entitlements in England. It is intended to improve the setting's universal inclusive offer, especially for children with emerging SEND.
In plain terms, this is setting-level funding rather than a pot attached to one child's diagnosis or plan. The DfE wants providers to use it for changes that help staff identify needs earlier and make ordinary provision more accessible.
The fund can sit alongside:
- special educational needs inclusion funding, known as SENIF
- disability access funding, known as DAF
- high needs funding for children with more complex needs
The DfE conditions of grant are explicit that IEYF is additional. Local authorities should not use its introduction as a reason to reduce existing SENIF spending.
Who should receive it?
Local authorities can fund early years providers that deliver the free early years entitlements. That may include private, voluntary and independent providers, maintained nursery schools, and nursery provision in schools where the eligibility rules are met.
The local authority decides its distribution formula. The DfE recommends a base rate, an additional needs factor and a minimum allocation of around £1,000, though councils may adapt the formula locally. Some small providers and childminders may fall below that threshold. They can still access SENIF, DAF or high needs funding where eligible.
Providers should expect the council to explain:
- whether the setting is eligible
- how the allocation was calculated
- when the payment will arrive
- what evidence the council will request
- where to ask about a missing or unclear allocation
If that explanation has not arrived, ask for it. The funding is meant to reduce bureaucracy, not start another guessing game.
What can providers spend the money on?
The test is whether the spending strengthens inclusive practice across the setting. The DfE best practice guidance gives practical examples.
Staff knowledge and release time
A setting could fund whole-team inclusion training, SENCO coaching or paid release time so staff can attend training during working hours. It can also support leadership time to embed that learning through coaching and changes to practice.
A more accessible environment
Providers can make practical changes such as visual timetables, consistent visual supports, structured routines, adapted equipment or changes to how children move between activities.
The strongest choices solve a problem staff can name. A consistent visual sequence used by the whole team is easier to justify than sensory resources bought without a plan.
Earlier and better coordination
The fund may support staff time for joint planning with health professionals, educational psychologists or speech and language therapists. It can also fund extra transition planning, visits and liaison with a receiving school.
Support for families
The guidance includes parent workshops, regular meetings and transition support. Settings might use the funding to improve access to early communication support or help families understand what will happen before a child moves into Reception.
What should a school nursery do first?
Do not start with a shopping list. Start with the barriers children and staff meet now.
A useful first meeting can be short:
- Review patterns across the cohort, without waiting for formal labels.
- Identify one or two setting-wide barriers that affect access, communication, participation or transitions.
- Check what core funding should already cover.
- Choose an IEYF use that adds something practical.
- Name the person responsible and the date for implementation.
- Decide what evidence will show whether the change happened and helped.
For a school nursery, involve the early years lead, SENCO and business manager. Between them, they can test the need, the financial trail and whether the proposal will work in daily practice.
What evidence do providers need to keep?
Providers are responsible for using IEYF on inclusive practice, keeping financial evidence and responding to reasonable information requests from the local authority.
The DfE describes proportionate assurance. A council may use a simple annual return or light-touch sampling.
A practical evidence pack should contain:
- the allocation notice and amount
- the problem the setting chose to address
- the agreed activity or purchase
- the decision date and responsible person
- invoices, receipts or staff release records
- a brief account of what changed
- any review point or next action
Do not put personal detail into a funding return unless the council genuinely needs it. The fund is for whole-setting practice, so the evidence can usually explain the decision without turning one child's history into the justification.
Where changes affect a child's support plan, keep that plan current as well. MeritDocs helps schools turn recorded pupil information into structured UK SEND support documents, with staff checking and approving the result. That is a separate record from the finance evidence, and it should stay separate.
How should providers judge whether the spending worked?
The fund does not require settings to invent a complicated impact framework. A small number of observable questions will do more good.
Ask:
- Did the planned change happen?
- Are staff using it consistently?
- Has access or participation improved for the children it was meant to help?
- What have families and practitioners noticed?
- Does the approach need adjusting before the next term?
If a nursery funds coaching and a common visual transition routine, first check that staff received the coaching and use the routine consistently. Then review where children still struggle.
MeritDocs keeps SEND documents in a searchable hub, so current support information and review dates are easier for school staff to find. The gain here is continuity. A setting-wide improvement should appear in the relevant live support record when it changes what an individual child receives.
What are the important dates?
The immediate timeline is short:
- final local authority allocations were published on 22 July 2026
- payments to local authorities are due at the end of July 2026
- local authorities must distribute all IEYF within the financial year
- providers must spend it by 31 March 2027
- money that is unspent, unsupported by evidence or used outside the permitted purposes may be recovered
The DfE also says it expects to consult later in 2026 on wider reform of early years funding. New national early years SEND training is planned for all practitioners from September 2027.
A five-point IEYF checklist
Before signing off a plan, check that:
- The setting understands how its allocation was calculated.
- The proposed spend strengthens inclusive practice across the setting.
- It adds to core provision and does not replace another funding stream.
- A named person owns delivery and review.
- Financial evidence and a short decision record will be kept until the council confirms its assurance requirements.
Frequently asked questions
Do providers need to apply for IEYF?
No. The DfE guidance says local authorities should distribute it upfront through a formula, without a panel or application process.
Is IEYF attached to an individual child?
No. It is intended for setting-wide inclusive practice, especially support that helps settings respond to emerging SEND earlier.
Does IEYF replace SENIF or DAF?
No. It is additional to SENIF, DAF and high needs funding.
The useful way to treat this fund
IEYF is a chance to fix a real inclusion barrier before it becomes a stack of individual applications. Spend it on a change staff can use, families can understand and leaders can evidence.
Keep the record light, but do keep it. By March 2027, the setting should be able to show what it received, what it changed and what it learned. That is better than a receipt folder, and much better than trying to reconstruct the decision after the person who made it has moved on.