While early years organisations were quick to welcome the funding, they were also left a little baffled.
In part, this was because no details were provided about how the money would be allocated to local authorities, and when. Early years organisations and providers have been left looking for clues about what really lies behind the headline figure.
Many in the sector continue to voice concern that the real issue is not just about granting nurseries funding to extend their premises so that they can increase their capacity, but whether they will receive sufficient revenue funding to cover the ongoing costs of places, an issue which many say remains unaddressed.
The Pre-School Learning Alliance said that while the capital injection was welcome, it would be watching closely to ensure the funding was distributed equitably and was not used to favour a particular sector.
Speaking at a conference in London on Thursday, Neil Leitch, chief executive of the Alliance, said that the indicative rate for two-year-olds, based on £760m Government funding split between 260,000 places - the Government's target figure for 40 per cent of all two-year-olds in September 2014 - equates to £5.13 per child per hour.
Even supposing that the full amount of funding for two-year-olds were to be passed to the non-maintained sector, he calculated the actual cost of providing a place for a disadvantaged two-year-old, taking into account the need for higher staff-child ratios, to be £5.28 an hour.
Mr Leitch said one of the major lessons learned from the pilot areas was that many providers did not anticipate the amount of extra work involved.
He said he knew of one setting that described the funding they receive as 'grossly inadequate', because it is not just the children that need support, but the families too. The manager of that setting said that a more realistic figure would be £10-£12 an hour, nearly three times more than the allocation in some areas.
Vividly describing a visit he had made to one nursery taking part in the two-year-old offer, he said, 'A little boy who was on the at-risk register and was funded under the scheme arrived at pre-school. His father had poured a bottle of bleach down the back of the child's nappy, burning the skin.' He said staff were still dealing with the incident at 11pm.
There has also been some confusion over how capital funding will benefit childminders, many of whom are already able to offer extra places for two-year-olds without extending their homes.
Simona McKenzie, a childminder from Richmond, summed it up. 'We need more clarification about how each local authority is going to use the funding,' she said. 'Why would a childminder need capital funding if they already have the space? We don't know how this is going to be administered.'
However, Sue Smith, owner of Young Explorers nursery in Stoke-on-Trent, has just taken on 12 two-year-olds and was more upbeat about the funding.
She said the money she receives from the local authority does cover her costs because she is able to limit the number of places limited to morning or afternoon-only sessions.
'Any extra funding for nurseries is a good thing,' she said. 'We would have been able to buy new equipment and it would speed up the process of offering the places.'
The nursery benefited from capital funding when it was offered by the previous Labour Government, using it to improve its outdoor area.
It is interesting to note that last time the early years sector received this capital funding it was a £642m grant, earmarked specifically for private, voluntary and independent settings.
Early years providers will now have to wait and see whether the promised £100m delivers, and hope that it does not disappear, as feared, into schools' budgets.
INDUSTRY VIEW
There have been similar capital funding streams in the past - the last one was to make improvements to premises and provide outdoor space. There were a number of issues local authorities faced allocating the monies, such as planning permission and spending restrictions. I imagine they will face similar issues with this capital funding.
I would also question how and on what basis, the £100m capital has been calculated?
We know an estimated 260,000 places will be required by September 2014, but does the department really know how many places for two-year-olds currently exist and how many new places need to be created? I think much of the need could be met from existing provision and providers would be keener to offer places if sufficient revenue funding was found to fund the free entitlement.
There are many children's centres sitting idle for most of the day due to lack of funding, many of these based in areas where disadvantaged two-year-olds live - surely with adequate revenue funding these could provide additional places?
I am also concerned that this injection of capital funding will not reach the PVIs, who may want to provide additional places for disadvantaged two-year-olds, but will be allocated to the maintained sector to bolster school budgets.
Denise Burke, director, United for All Ages/GoodCare Guide and former head of Youth and Childcare, the London Development Agency
The extra £100 million for early years is very welcome, but I question the need for more nice new shiny buildings or extensions.
I attended an NDNA consultation with representatives from the Childcare Commission and 20 nurseries. In a straw poll, the vast majority of settings had occupancy levels less than 90 per cent. The NDNA's survey showed there were many nurseries with occupancy levels below 70 per cent.
These low levels of occupancy might not be reflected in areas where the largest numbers of disadvantaged two-year-olds live, but has the Government done any work on this? It was not long ago it was criticised by the National Audit Commission for not knowing where the money went when it came to early years.
Ken McArthur, owner of Polly Anna's nursery in York
