diff --git a/changelog.d/2183.fixed.md b/changelog.d/2183.fixed.md
new file mode 100644
index 0000000000..3097b99f77
--- /dev/null
+++ b/changelog.d/2183.fixed.md
@@ -0,0 +1 @@
+- Updated England childcare entitlement valuations to the published 2025–26 and 2026–27 national-average funding rates.
diff --git a/policyengine_uk/parameters/gov/dfe/childcare_funding_rate.yaml b/policyengine_uk/parameters/gov/dfe/childcare_funding_rate.yaml
index 0962566d14..7d8ccf8ff8 100644
--- a/policyengine_uk/parameters/gov/dfe/childcare_funding_rate.yaml
+++ b/policyengine_uk/parameters/gov/dfe/childcare_funding_rate.yaml
@@ -1,4 +1,7 @@
-description: The Department for Education converts childcare hours into expenses for childcare entitlement at these rates.
+description: >-
+  National-average English local-authority hourly funding used to value
+  childcare entitlements. These combined age-group averages are a model
+  valuation proxy, not individual provider fees or programme-specific rates.
 metadata:
   type: single_amount
   threshold_unit: year
@@ -8,17 +11,30 @@ metadata:
   reference:
     - title: House of Commons Library | Early years funding in England
       href: https://commonslibrary.parliament.uk/research-briefings/cbp-8052/
+    - title: DfE 2025 to 2026 early years national funding formulae technical note, Table 6 (historical, withdrawn)
+      href: https://www.gov.uk/government/publications/early-years-funding-2025-to-2026/2025-to-2026-early-years-national-funding-formulae-technical-note#table-6-2025-to-2026-national-average-of-local-authority-hourly-funding-rates
+    - title: DfE 2026 to 2027 early years national funding formulae technical note, Table 6
+      href: https://www.gov.uk/government/publications/early-years-funding-2026-to-2027/2026-to-2027-early-years-national-funding-formulae-technical-note#table-6-2026-to-2027-national-average-of-local-authority-hourly-funding-rates
 
+# Funding years run April to March. The existing annual model samples
+# 30 April; it retains its separate annual approximation of the hours rollout.
+# Later years continue to use the existing CPI projection, not official rates.
 brackets:
   - threshold:
       2015-01-01: 0
     amount:
       2024-04-01: 11.22
+      2025-04-01: 11.54
+      2026-04-01: 12.04
   - threshold:
       2015-01-01: 2
     amount:
       2024-04-01: 8.28
+      2025-04-01: 8.53
+      2026-04-01: 8.90
   - threshold:
       2015-01-01: 3
     amount:
-      2024-04-01: 5.88
\ No newline at end of file
+      2024-04-01: 5.88
+      2025-04-01: 6.12
+      2026-04-01: 6.61
diff --git a/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement.yaml b/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement.yaml
index b642b1c4b5..9fb1a9963c 100644
--- a/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement.yaml
+++ b/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement.yaml
@@ -3,8 +3,8 @@
 # counts those hours towards the 30. Every child here is in England (the default)
 # and claims the universal entitlement (the default), so a 3- or 4-year-old's
 # universal 570 hours a year come off the 1,140 the parameter gives. Rates per
-# hour: 2025 £8.486995 (age 2) and £6.026996 (3-4); 2026 £8.775556 (age 2) and
-# £6.231916 (3-4).
+# hour: 2025 £8.53 (age 2) and £6.12 (3-4); 2026 £8.90 (age 2) and
+# £6.61 (3-4).
 - name: 3-year-old gets the 15 working parent hours above the universal 15
   period: 2025
   absolute_error_margin: 0.05
@@ -17,9 +17,9 @@
         members: [child1]
         extended_childcare_entitlement_eligible: true
   output:
-    # (1,140 - 570) x 6.026996
-    extended_childcare_entitlement: 3435.39
-    universal_childcare_entitlement: 3435.39
+    # (1,140 - 570) x 6.12
+    extended_childcare_entitlement: 3488.40
+    universal_childcare_entitlement: 3488.40
 
 - name: Eligible for 15 hours - 2 year old (evaluated at Jan 1, 2025 before Sept expansion)
   period: 2025
@@ -33,8 +33,8 @@
         members: [child1]
         extended_childcare_entitlement_eligible: true
   output:
-    # 15 x 38 x 8.486995; no targeted hours, so nothing comes off.
-    extended_childcare_entitlement: 4837.59
+    # 15 x 38 x 8.53; no targeted hours, so nothing comes off.
+    extended_childcare_entitlement: 4862.10
 
 - name: Not eligible (one condition not met)
   period: 2025
@@ -64,8 +64,8 @@
         members: [child1, child2]
         extended_childcare_entitlement_eligible: true
   output:
-    # 570 x 8.486995 + (1,140 - 570) x 6.026996
-    extended_childcare_entitlement: 8272.97
+    # 570 x 8.53 + (1,140 - 570) x 6.12
+    extended_childcare_entitlement: 8350.50
 
 - name: Not eligible - Family with multiple children but conditions not met
   period: 2025
@@ -100,8 +100,8 @@
         family_type: COUPLE_WITH_CHILDREN
         extended_childcare_entitlement_eligible: true
   output:
-    # 570 x 8.486995 + 2 x (1,140 - 570) x 6.026996
-    extended_childcare_entitlement: 11708.36
+    # 570 x 8.53 + 2 x (1,140 - 570) x 6.12
+    extended_childcare_entitlement: 11838.90
 
 - name: No expenses for zero hours
   period: 2025
@@ -130,10 +130,10 @@
         members: [child1]
         extended_childcare_entitlement_eligible: true
   output:
-    # (20 x 38 - 570) x 6.026996: 190 working parent hours on top of the
+    # (20 x 38 - 570) x 6.12: 190 working parent hours on top of the
     # universal 570.
-    extended_childcare_entitlement: 1145.13
-    universal_childcare_entitlement: 3435.39
+    extended_childcare_entitlement: 1162.80
+    universal_childcare_entitlement: 3488.40
 
 - name: Child using fewer hours than maximum entitlement - multiple children
   period: 2025
@@ -151,8 +151,8 @@
         members: [child1, child2]
         extended_childcare_entitlement_eligible: true
   output:
-    # 10 x 38 x 8.486995 + max(0, 15 x 38 - 570) x 6.026996
-    extended_childcare_entitlement: 3225.06
+    # 10 x 38 x 8.53 + max(0, 15 x 38 - 570) x 6.12
+    extended_childcare_entitlement: 3241.40
 
 - name: Benefit unit maximum hours cap applied
   period: 2025
@@ -171,8 +171,8 @@
         extended_childcare_entitlement_eligible: true
         maximum_extended_childcare_hours_usage: 40
   output:
-    # The cap applies to each child: 2 x (1,140 - 570) x 6.026996
-    extended_childcare_entitlement: 6870.78
+    # The cap applies to each child: 2 x (1,140 - 570) x 6.12
+    extended_childcare_entitlement: 6976.80
 
 - name: A family cap below the universal hours leaves the universal hours whole
   period: 2025
@@ -191,7 +191,7 @@
     # 10 x 38 = 380 hours is under the universal 570, so no working parent
     # hours, and the universal 570 stay.
     extended_childcare_entitlement: 0
-    universal_childcare_entitlement: 3435.39
+    universal_childcare_entitlement: 3488.40
 
 - name: A family cap above 15 adds the hours between 15 and the cap
   period: 2025
@@ -207,8 +207,8 @@
         extended_childcare_entitlement_eligible: true
         maximum_extended_childcare_hours_usage: 18
   output:
-    # (18 x 38 - 570) x 6.026996
-    extended_childcare_entitlement: 687.08
+    # (18 x 38 - 570) x 6.12
+    extended_childcare_entitlement: 697.68
 
 - name: Benefit unit without maximum hours cap applied with 3 years old child
   period: 2025
@@ -226,7 +226,7 @@
   output:
     # The child uses 15 hours, all of them universal.
     extended_childcare_entitlement: 0
-    universal_childcare_entitlement: 3435.39
+    universal_childcare_entitlement: 3488.40
 
 - name: Eligible for 30 hours - 2 year old after September 2025 expansion
   period: 2026
@@ -240,8 +240,8 @@
         members: [child1]
         extended_childcare_entitlement_eligible: true
   output:
-    # 30 x 38 x 8.775556; no targeted hours.
-    extended_childcare_entitlement: 10004.13
+    # 30 x 38 x 8.90; no targeted hours.
+    extended_childcare_entitlement: 10146.00
 
 - name: Eligible for 30 hours - Family with multiple 2-year-olds after expansion
   period: 2026
@@ -257,8 +257,8 @@
         members: [child1, child2]
         extended_childcare_entitlement_eligible: true
   output:
-    # 1,140 x 8.775556 + (1,140 - 570) x 6.231916
-    extended_childcare_entitlement: 13556.33
+    # 1,140 x 8.90 + (1,140 - 570) x 6.61
+    extended_childcare_entitlement: 13913.70
 
 # SI 2022/1134 reg 13(2)(b): a child looked after by a local authority is not a
 # qualifying child, so only the other three-year-old's working parent hours
@@ -279,5 +279,5 @@
         members: [child1, child2]
         extended_childcare_entitlement_eligible: true
   output:
-    extended_childcare_entitlement: 3435.39
-    universal_childcare_entitlement: [3435.39, 3435.39]
+    extended_childcare_entitlement: 3488.40
+    universal_childcare_entitlement: [3488.40, 3488.40]
diff --git a/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement_per_child.yaml b/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement_per_child.yaml
index a445d1dd3d..9397df199b 100644
--- a/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement_per_child.yaml
+++ b/policyengine_uk/tests/policy/baseline/gov/dfe/extended_childcare_entitlement/extended_childcare_entitlement_per_child.yaml
@@ -1,8 +1,8 @@
 # Each child's working parent hours are the part of its funded hours above the
 # universal (3-4) or targeted (2) hours: Childcare Act 2016 s.1(6)(a), and DfE's
 # statutory guidance (April 2026) para A1.11 for a 2-year-old eligible for both.
-# Rates per hour: 2025 £8.486995 (age 2); 2026 £11.891514 (under 2),
-# £8.775556 (age 2) and £6.231916 (3-4).
+# Rates per hour: 2025 £8.53 (age 2); 2026 £12.04 (under 2),
+# £8.90 (age 2) and £6.61 (3-4).
 - name: A 2-year-old eligible for both gets 15 targeted plus 15 working parent hours
   period: 2026
   absolute_error_margin: 0.05
@@ -16,10 +16,10 @@
         extended_childcare_entitlement_eligible: true
         targeted_childcare_entitlement_eligible: true
   output:
-    # 570 x 8.775556 each
-    targeted_childcare_entitlement: 5002.07
-    extended_childcare_entitlement_per_child: 5002.07
-    extended_childcare_entitlement: 5002.07
+    # 570 x 8.90 each
+    targeted_childcare_entitlement: 5073.00
+    extended_childcare_entitlement_per_child: 5073.00
+    extended_childcare_entitlement: 5073.00
 
 - name: Before September 2025 a 2-year-old eligible for both gets the targeted 15 hours
   period: 2025
@@ -35,8 +35,8 @@
         targeted_childcare_entitlement_eligible: true
   output:
     # The working parent total (15 hours at 1 January 2025) is no more than
-    # the targeted 570 hours: 570 x 8.486995 targeted, nothing on top.
-    targeted_childcare_entitlement: 4837.59
+    # the targeted 570 hours: 570 x 8.53 targeted, nothing on top.
+    targeted_childcare_entitlement: 4862.10
     extended_childcare_entitlement_per_child: 0
 
 - name: A 1-year-old has no universal or targeted hours to come off
@@ -51,8 +51,8 @@
         members: [child]
         extended_childcare_entitlement_eligible: true
   output:
-    # 30 x 38 x 11.891514
-    extended_childcare_entitlement_per_child: 13556.33
+    # 30 x 38 x 12.04
+    extended_childcare_entitlement_per_child: 13725.60
 
 - name: Working parent participation funds universal first even with false standalone take-up
   period: 2026
@@ -67,10 +67,10 @@
         extended_childcare_entitlement_eligible: true
         would_claim_universal_childcare: false
   output:
-    # 15 x 38 x 6.231916 in each programme, preserving all 30 funded hours.
+    # 15 x 38 x 6.61 in each programme, preserving all 30 funded hours.
     universal_childcare_entitlement_eligible: true
-    universal_childcare_entitlement: 3552.19
-    extended_childcare_entitlement_per_child: 3552.19
+    universal_childcare_entitlement: 3767.70
+    extended_childcare_entitlement_per_child: 3767.70
     is_child_receiving_universal_childcare: true
     is_child_receiving_extended_childcare: true
 
@@ -88,8 +88,8 @@
         extended_childcare_entitlement_eligible: true
         would_claim_universal_childcare: false
   output:
-    # 10 x 38 x 6.231916; the unpaid standalone floor is not added.
-    universal_childcare_entitlement: 2368.13
+    # 10 x 38 x 6.61; the unpaid standalone floor is not added.
+    universal_childcare_entitlement: 2511.80
     extended_childcare_entitlement_per_child: 0
     is_child_receiving_universal_childcare: true
     is_child_receiving_extended_childcare: false
@@ -108,7 +108,7 @@
         maximum_extended_childcare_hours_usage: 10
         would_claim_universal_childcare: false
   output:
-    universal_childcare_entitlement: 2368.13
+    universal_childcare_entitlement: 2511.80
     extended_childcare_entitlement_per_child: 0
 
 - name: Legal universal eligibility alone does not create take-up
@@ -142,9 +142,9 @@
         would_claim_targeted_childcare: false
   output:
     targeted_childcare_entitlement_eligible: true
-    # 15 x 38 x 8.775556 in each programme (DfE A1.11).
-    targeted_childcare_entitlement: 5002.07
-    extended_childcare_entitlement_per_child: 5002.07
+    # 15 x 38 x 8.90 in each programme (DfE A1.11).
+    targeted_childcare_entitlement: 5073.00
+    extended_childcare_entitlement_per_child: 5073.00
     is_child_receiving_targeted_childcare: true
     is_child_receiving_extended_childcare: true
 
@@ -163,8 +163,8 @@
         extended_childcare_entitlement_eligible: true
         would_claim_targeted_childcare: false
   output:
-    # 10 x 38 x 8.775556, with no unfunded floor subtracted.
-    targeted_childcare_entitlement: 3334.71
+    # 10 x 38 x 8.90, with no unfunded floor subtracted.
+    targeted_childcare_entitlement: 3382.00
     extended_childcare_entitlement_per_child: 0
     is_child_receiving_targeted_childcare: true
     is_child_receiving_extended_childcare: false
@@ -183,7 +183,7 @@
         extended_childcare_entitlement_eligible: true
         would_claim_targeted_childcare: false
   output:
-    targeted_childcare_entitlement: 4837.59
+    targeted_childcare_entitlement: 4862.10
     extended_childcare_entitlement_per_child: 0
 
 - name: Legal targeted eligibility alone does not create take-up
@@ -231,9 +231,9 @@
         members: [parent, child]
         extended_childcare_entitlement_eligible: true
   output:
-    # (1,140 - 570) x 6.231916 for the child only
-    extended_childcare_entitlement_per_child: [0, 3552.19]
-    extended_childcare_entitlement: 3552.19
+    # (1,140 - 570) x 6.61 for the child only
+    extended_childcare_entitlement_per_child: [0, 3767.70]
+    extended_childcare_entitlement: 3767.70
 
 # The same overlap through the targeted eligibility formula itself: Income
 # Support is a qualifying benefit, and eligibility for the working parent
@@ -256,9 +256,9 @@
         country: ENGLAND
   output:
     targeted_childcare_entitlement_eligible: true
-    # 570 x 8.775556 each
-    targeted_childcare_entitlement: 5002.07
-    extended_childcare_entitlement_per_child: 5002.07
+    # 570 x 8.90 each
+    targeted_childcare_entitlement: 5073.00
+    extended_childcare_entitlement_per_child: 5073.00
     is_child_receiving_targeted_childcare: true
     is_child_receiving_extended_childcare: true
 
@@ -280,8 +280,8 @@
         country: ENGLAND
   output:
     targeted_childcare_entitlement_eligible: true
-    # 570 x 8.486995 targeted; the 15-hour working parent total adds nothing.
-    targeted_childcare_entitlement: 4837.59
+    # 570 x 8.53 targeted; the 15-hour working parent total adds nothing.
+    targeted_childcare_entitlement: 4862.10
     extended_childcare_entitlement_per_child: 0
     is_child_receiving_targeted_childcare: true
     is_child_receiving_extended_childcare: false
diff --git a/policyengine_uk/tests/policy/integration/entitledto_scenarios.yaml b/policyengine_uk/tests/policy/integration/entitledto_scenarios.yaml
index 95c2636d94..41c2963f3d 100644
--- a/policyengine_uk/tests/policy/integration/entitledto_scenarios.yaml
+++ b/policyengine_uk/tests/policy/integration/entitledto_scenarios.yaml
@@ -74,7 +74,10 @@
     universal_credit: 12_490.86
     housing_benefit: 0
     child_benefit: 2_251.60
-    household_net_income: 36_114.90
+    # The 3yo's 570 universal hours at the 2025 funding rate of £6.12
+    # are valued at £3,488.40, up £53.01 from £3,435.39.
+    universal_childcare_entitlement: [0, 0, 0, 3_488.40]
+    household_net_income: 36_167.91
 
 - name: "EntitledTo #3 - pensioner couple, low state pension, qualifies for Pension Credit"
   period: 2025
diff --git a/policyengine_uk/tests/test_childcare_funding_rates.py b/policyengine_uk/tests/test_childcare_funding_rates.py
new file mode 100644
index 0000000000..35daf38b16
--- /dev/null
+++ b/policyengine_uk/tests/test_childcare_funding_rates.py
@@ -0,0 +1,165 @@
+"""DfE combined national-average funding is the model's hourly valuation.
+
+Table 6 of each funding-year technical note supplies the rate oracles. These
+are local-authority funding averages, not individual providers' fees. The
+existing annual model samples 30 April, without blending the hours rollout.
+"""
+
+from pathlib import Path
+
+import numpy as np
+import pytest
+from policyengine_core.parameters import load_parameter_file
+
+from policyengine_uk import Simulation
+from policyengine_uk.tax_benefit_system import system
+
+pytestmark = pytest.mark.usefixtures("cloned_uk_tax_benefit_system")
+RATES = {
+    2024: [11.22, 8.28, 5.88],
+    2025: [11.54, 8.53, 6.12],
+    2026: [12.04, 8.90, 6.61],
+}
+AGES = np.array([1, 2, 3])
+
+
+def working_family(year, country="ENGLAND", child_hours=30, family_hours=30):
+    people = {"parent": {"age": {year: 35}, "employment_income": {year: 30_000}}}
+    people.update(
+        {
+            f"child{age}": {
+                "age": {year: age},
+                "max_free_entitlement_hours_used": {year: child_hours},
+            }
+            for age in (1, 2, 3)
+        }
+    )
+    members = list(people)
+    return {
+        "people": people,
+        "benunits": {
+            "family": {
+                "members": members,
+                "maximum_extended_childcare_hours_usage": {year: family_hours},
+            }
+        },
+        "households": {"home": {"members": members, "country": {year: country}}},
+    }
+
+
+@pytest.mark.parametrize("year", [2025, 2026])
+def test_published_april_rates_and_prior_day(year):
+    raw = load_parameter_file(
+        str(
+            Path(__file__).parents[1] / "parameters/gov/dfe/childcare_funding_rate.yaml"
+        ),
+        "childcare_funding_rate",
+    )
+    np.testing.assert_allclose(
+        raw(f"{year}-04-01").calc(AGES), RATES[year], rtol=0, atol=1e-10
+    )
+    np.testing.assert_allclose(
+        raw(f"{year}-03-31").calc(AGES), RATES[year - 1], rtol=0, atol=1e-10
+    )
+
+
+@pytest.mark.parametrize("year", [2024, 2025, 2026])
+def test_april_anchors_reach_processed_annual_rates(year):
+    rates = system.parameters(str(year)).gov.dfe.childcare_funding_rate
+    np.testing.assert_allclose(rates.calc(AGES), RATES[year], rtol=0, atol=1e-10)
+
+
+@pytest.mark.parametrize(
+    "year,universal,extended_per_child,extended_total",
+    [
+        (2025, [0, 0, 0, 3488.40], [0, 6577.80, 4862.10, 3488.40], 14928.30),
+        (2026, [0, 0, 0, 3767.70], [0, 13725.60, 10146.00, 3767.70], 27639.30),
+    ],
+)
+def test_published_rates_reach_genuine_working_family_awards(
+    year, universal, extended_per_child, extended_total
+):
+    sim = Simulation(situation=working_family(year))
+    # 2025 retains the existing 15-hour under-three annual schedule; 2026
+    # gives 30. A three-year-old gets 570 universal hours plus 570 extended.
+    np.testing.assert_allclose(
+        sim.calculate("universal_childcare_entitlement", year),
+        universal,
+        rtol=0,
+        atol=0.02,
+    )
+    np.testing.assert_allclose(
+        sim.calculate("extended_childcare_entitlement_per_child", year),
+        extended_per_child,
+        rtol=0,
+        atol=0.02,
+    )
+    np.testing.assert_allclose(
+        sim.calculate("extended_childcare_entitlement", year),
+        extended_total,
+        rtol=0,
+        atol=0.02,
+    )
+
+
+@pytest.mark.parametrize("year,expected", [(2025, 4862.10), (2026, 5073.00)])
+def test_published_rates_reach_targeted_award_for_reported_qualifying_benefit(
+    year, expected
+):
+    # An ordinary reported Income Support award is an existing qualifying
+    # benefit input. Eligibility and the childcare amount are calculated.
+    sim = Simulation(
+        situation={
+            "people": {"parent": {"age": {year: 35}}, "child": {"age": {year: 2}}},
+            "benunits": {
+                "family": {
+                    "members": ["parent", "child"],
+                    "income_support": {year: 1000},
+                }
+            },
+            "households": {
+                "home": {"members": ["parent", "child"], "country": {year: "ENGLAND"}}
+            },
+        }
+    )
+    np.testing.assert_allclose(
+        sim.calculate("targeted_childcare_entitlement", year),
+        [0, expected],
+        rtol=0,
+        atol=0.01,
+    )
+
+
+@pytest.mark.parametrize("child_hours,family_hours", [(10, 30), (30, 10)])
+def test_child_and_family_usage_limits_keep_the_published_rate(
+    child_hours, family_hours
+):
+    sim = Simulation(
+        situation=working_family(
+            2026, child_hours=child_hours, family_hours=family_hours
+        )
+    )
+    # A one-year-old gets min(30,10) * 38 * £12.04, with no base hours.
+    assert sim.calculate("extended_childcare_entitlement_per_child", 2026)[
+        1
+    ] == pytest.approx(4575.20, abs=0.01)
+
+
+def test_outside_england_retains_zero_entitlements():
+    sim = Simulation(situation=working_family(2026, country="WALES"))
+    for variable in (
+        "universal_childcare_entitlement",
+        "targeted_childcare_entitlement",
+        "extended_childcare_entitlement",
+    ):
+        assert not np.asarray(sim.calculate(variable, 2026)).any()
+
+
+def test_existing_cpi_projection_starts_from_the_2026_funding_anchor():
+    # This verifies the retained projection rule, not an official 2027 rate.
+    p = system.parameters
+    factor = p("2027").gov.benefit_uprating_cpi / p("2026").gov.benefit_uprating_cpi
+    expected = np.array([12.04, 8.90, 6.61]) * factor
+    np.testing.assert_allclose(
+        p("2027").gov.dfe.childcare_funding_rate.calc(AGES), expected, rtol=0, atol=1e-8
+    )