Local authorities and their partner organisations will decide which settings are best placed to deliver the core Children's Centre services such as daycare and early education, health and family support, and childminder networks.
The expansion of the scheme means 43,000 group-based and childminder places will be created by March 2006, and the department said staff recruitment would be necessary.
Parents will have to pay for childcare in Children's Centres but it will be up to local authorities to determine fee structures.
Chancellor Gordon Brown made a commitment to fund the expansion of the Children's Centre network in his pre-Budget report last month, when he also extended tax breaks for childcare.
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