I hope I can help clear this up ( I own two nurseries).
It differs from area to area as to when the funding becomes available. In ALL areas, it is available from the term after your child terms 4. However, in a lot of areas it is available before this. That is because a cetain amount of money is given to each council from the government and it is up to them to decide how to use it.
The funding is only available to children who are in a registered day care setting....this includes nurseries, childminders, etc, but not with nannies or grandparents. The funding is paid direct to the childcare provider for all eligible children upon the completion of various paperwork on a termly basis. In each area, it varies as to how the parents recieve the benefit. At our nurseries, parents continue to pay their fees as usual, and then they get a refund of the funding amount. In other areas it is deducted fromthe nursery fees in advance, etc.
The funding covers up to 5 sessions per week of at least 2.5 hours per session. However, as many of you will know, this does not cover most nursery fees so you will usually have to pay a top up. The 5 sessions do not have to be taken on different days. For example, if your child attends 2 full days at nursery, this will count as 4 sessions.
Your childcare provider should have complete details on how the scheme works in your area.
Hope this helps.