Childcare Reform Package

Baroness Thornhill Excerpts

Thursday 29th June 2023 Lords Chamber

[Baroness Thornhill (LD)]

I absolutely agree with every word the noble Baroness, Lady Thornton, has just said. As a grandmother of three grandchildren, from six months to six years-old, I say that this is a very pertinent issue for us and very much a topic of discussion within our household. It really takes me back, having always been a working mum myself, to how very different it is now from how it was then.

My daughter really does struggle with this, particularly with the cost. She and her husband are both modest-income earners, with wraparound care for the oldest grandchild—those hours at the beginning and end of school. It would be churlish not to say that this is very radical and very welcome. But, for her, it could not come soon enough. The questions were “When’s that happening, Mum? I’ve heard about this, when’s it actually going to be?”

I am sure that the Minister accepts that we have a childcare sector that is buckling under the pressure of inadequate funding for many years, and that many early years providers are being forced to close permanently, with the number of registered providers falling steadily since 2015.

I would like to know whether the Government have a proper picture of where the gaps are in childcare. The noble Baroness, Lady Thornton, talked about availability, and anecdotally I can certainly bear that out because I know some women are having to travel quite complicated distances to put one child in one provision and another child in another provision before going to work. There are definitely geographical gaps in the system. Do the Government have an overall picture of how many providers are teetering on the brink at the moment? That is certainly an issue.

On the existing entitlements for two, three and four year-olds, the Early Years Alliance and the Women’s Budget Group estimate that the current budget offer, however generous it seems when we hear the figures bandied about, is actually underfunded by £1.8 billion a year. I believe that the Government are providing only an extra £280 million this year and an extra £288 million next year. As I say, those sound like huge numbers but, in the light of the deficit, do we really feel that it is enough? Do we have any notion of how many providers we might lose by then?

The number of parents taking up the childcare element of universal credit concerns me; it appears very low, with only 13% of households getting the childcare element. Does the Minister agree that the department should perhaps explore why take-up is not higher and commit to publishing statistics so that progress in this area can be measured? Does she accept that, as this particular element has been frozen for seven years, and therefore obviously has failed to keep pace with inflation, we have in effect wasted seven years in getting a cohort of parents back into work?

I commend the plans for having a real career structure for nursery, but I echo what the noble Baroness, Lady Thornton, said about plans that the Government might have to restore childminding as a valuable part of the early years system. Perhaps they could look at replacing the current three different registration processes with a single childcare register and commissioning a practitioner-led review to simplify that regulation and reduce administrative burdens. That should attract new childminders, who love looking after children but are, I know, daunted by the paperwork. It need not mean lowering standards.

The question of summer childcare costs is crucial. Not everyone has grandparents who are willing or available—or indeed the money to pay for these courses, which, certainly in the area of Hertfordshire where I live, seem disproportionately expensive.

[Baroness Barran (Con)]

I thank both noble Baronesses for their generosity in welcoming our announcement. I am grateful for the reflection from the noble Baroness opposite that perhaps her colleague in the other place was a little harsh; I welcome her tone.

The noble Baroness, Lady Thornhill, suggested that the measure was radical for this Government. I would say it was radical for any Government. We are putting an extra £4 billion into the childcare system, raising it to a total of £8 billion. I think the House will agree with me that that is a radical move.

I contest the assertion that this Government have been late to the party. We introduced 30 hours of free childcare for three and four year-olds and 15 hours for disadvantaged two year-olds, so we have made tremendous progress. I do not recognise her assertion that people are leaving the sector in droves. There were 331,000 employees in the sector in 2018 and 334,000 in 2022, which by my maths is roughly unchanged.

The noble Baroness, Lady Thornton, commented that most children in childcare are aged three to four, but that is obviously a reflection of the free provision, and we very much expect that there will be a significant increase thanks to the new free offers. She asked how we have done our modelling. Part of that has come from the regular surveys that we do with about 10,000 providers and 6,000 parents, which have helped to inform both the levels of funding per hour that we are offering to providers and the nature of provision.

The noble Baroness, Lady Thornhill, mentioned the very important issue of wraparound childcare. The Government have already announced a £289 million investment to support local authorities, primary schools and private providers to improve the availability of wraparound childcare before and after school during term time. That funding will be available from January 2024, with access from September 2024. The noble Baroness looks a little unhappy at that, but I hope she would agree that it is important that we allow the sector to put in the capacity ahead of demand, rather than the other way around—otherwise, we will not be thanked for it.

The noble Baroness, Lady Thornhill, referred to the comments of the Early Years Alliance. As I said in relation to the point made by the noble Baroness, Lady Thornton, we consult very regularly with about 10,000 providers, and that has informed the levels of funding that we have set. I would counter the criticism from the Early Years Alliance with the comments of the chief executive of Pregnant Then Screwed, who said:

“Just 3 years ago, we would talk to Ministers about childcare and they would look at us like we were speaking Klingon. It was of no interest to those in power. To go from there to childcare being the main event in the Spring budget shows the power of collective action and we are elated to hear that the childcare sector will now receive a significant investment”.


I guess there is more than one view on our initiatives.

I turn now to the specific questions that the noble Baroness, Lady Thornton, raised. She asked what steps the Government are taking to address the cliff edge in costs between government-funded hours and hours for which parents have to pay. The context for this is that we are putting an additional £4 billion into the system. As I said in the repeat of the Statement, this will save households £650,000 a year, and they will get free childcare for younger children, as well as three and four year-olds. Childcare is a predictable cost; it is something that people can plan for. I am not saying that there is no pressure on households during the holidays; I am saying that the net pressure, given how much we are putting into the system, is reduced.

I also remind the House of the holiday activities and food programme, which 600,000 children accessed in the last year. The report back from those children was that 70% had experiences that they had never had otherwise—I am taking that in a positive way. It was a very valuable programme, and it is obviously part of this.

Both noble Baronesses questioned whether there would be enough capacity in the sector to deliver the increase that will be required. The Government do not underestimate, at all, the scale of the challenge in this area.

I referred to the accelerated apprenticeships and degree apprenticeships. We are obviously consulting on the early years and foundation stage framework, looking at different flexibilities for staff—not in any way diluting the quality of staff but allowing more flexibility in appropriate qualifications. For example, do you need a level 3 in maths to be a childminder of very young children? There might be other skills we should look for.

The noble Baroness, Lady Thornton, talked about difficulties in uptake, as did the noble Baroness, Lady Thornhill, specifically in relation to universal credit. I remind the House that the uptake for free childcare for three year-olds is 90%, and for disadvantaged two year-olds it is 72%. So there has been a big increase in uptake, including in the last year. Tax-free childcare was up by 14% in the last year. We are planning for the 2023-24 childcare choices campaign, and we want to continue to improve people’s understanding of the government childcare offer, including the measures announced in the Spring Budget.

I hope that I have addressed most of the points that both noble Baronesses raised.