Two weeks ago, the authority wrote to parents telling them that private nursery places, which had been funded since last year, would no longer be available. But protests from parents and nursery owners have reversed this decision, and parents have now been told that they can reapply for places for the forthcoming session.

A separate letter, however, has been sent to the nursery owners, warning them that funding cannot be guaranteed for subsequent years.

Expanded private-sector provision in the past few years has given parents in Dundee a choice of 27 nurseries, but many found that there were no places in local authority nurseries near their home or work. The council has 12 nurseries, mainly in housing estates, with only one in the city centre.

Conservative MSP for North East Scotland Alex Johnstone has written to Dundee City Council and to Education Minister Cathy Jamieson on parents’

behalf. “Parents have been very concerned because they cannot afford to pay the full cost of a private nursery place. Meanwhile they have been told there are no local authority places available in their area. They will therefore have to travel to find a state-funded place,” he said.

Lynn Boyle, the private nursery owners’ representative on the council’s Early Years and Childcare Partnership, said figures for the demand for nursery places for three-year-olds next session were given to officials last November. At a meeting with officials in early June, nursery owners were given no warning that funding for three-year-olds would be discontinued.

A council spokesman said the decision to withdraw funding was taken because “demand outstripped the pot of money set aside to commission pre-school education outwith local authority provision.” The subsequent U-turn came about following a “review”.

“We now hope we may be able to accommodate most of the parents’ needs,” he said.