CMA Childcare Market Review 2026: What It Could Mean for Nursery Owners

What is the CMA childcare market study?

The Competition and Markets Authority, usually referred to as the CMA, is examining the supply of early years education and childcare services in England.

The study covers provision for children from birth until they start school at around four or five years old. This includes nurseries, pre-schools, childminders and school-based early years settings.

The purpose is to establish how well the market is working for families and providers, identify areas that may not be functioning effectively and consider where practical improvements could be made.

It sits alongside the Government’s wider review of childcare provision. The Education Secretary asked the CMA to provide an independent assessment that could help inform that work.

What will the CMA investigate?

The proposed scope is much wider than simply looking at the prices parents pay. It includes the financial and structural pressures affecting childcare businesses.

Why should nursery owners pay attention?

Many of the questions included in the market study relate directly to the concerns nursery owners have raised for years.

Does funded childcare cover the true cost of delivery?

The CMA intends to examine whether government-funded hours cover providers’ costs and how settings manage any gap. This may include the use of private fees, additional hours, consumable charges and other forms of cross-subsidy.

What is preventing nurseries from opening or expanding?

Property availability, planning, registration times, staffing, local authority processes and the cost of expansion can all act as barriers. The CMA will consider barriers to entry and growth within the market.

Are different types of providers competing on equal terms?

Independent nurseries, school-based provision, charities, large nursery groups and childminders operate under different business models. The study could examine how funding and public policy affect those providers differently.

Can parents clearly compare childcare options?

The study will consider whether families receive sufficient information about fees, additional charges, funding and contractual arrangements before selecting a provider.

What the CMA study will not cover

• It will not assess the educational standards of individual nurseries or childminders.
• It will not replace an Ofsted inspection or regulatory investigation.
• Its formal scope is England because childcare funding and regulation are devolved.
• Nannies and informal childcare that cannot deliver funded hours are outside the main study.
• The launch of the study does not mean that the CMA has already decided what changes should be made.

Its eventual findings will depend on the evidence gathered from families, providers, government bodies, local authorities and other organisations.

The expected timeline

What evidence should nursery providers share?

This is an opportunity for providers to give the CMA practical evidence rather than relying only on general statements that the sector is under pressure.

What could happen after the review?

No outcome has been decided. However, depending on the evidence, possible outcomes could include:

• recommendations to government about childcare funding design or distribution;
• recommendations relating to regulation or the role of public bodies;
• improvements to information available to families and childcare providers;
• guidance for childcare businesses or consumers;
• further consideration of particular consumer protection concerns;
• evidence that helps shape future childcare policy.

The study is unlikely to produce an immediate change to nursery funding or regulation. Its importance is that it could create an independent evidence base for decisions taken during 2027 and beyond.