Childcare Bill [ Lords ] (First sitting)

Chloe Smith Excerpts

Tuesday 8th December 2015 Public Bill Committees

[Pat Glass]

That is right, but I also understand that the review mentioned in clause 1 is about reviewing the sustainability and financial support for the Bill. The Lords were concerned that the Bill was not sustainable without looking at the issues of funding, the workforce and the capacity of the industry to deliver the provisions of the Bill. I am trying to tease that out. There are serious issues with capacity in the workforce. Nurseries tell me that they cannot recruit the level 3 students that they need to deliver the 15 hours.

There are serious issues around cross-subsidy. At the moment, nurseries are delivering the free 15 hours by charging beyond the 15 hours for parents who want more than 15, so anybody who gets more than 15 hours is basically subsidising the Government’s 15 hours. If the ability to extend that is taken away because nurseries have to offer 30 hours, the only way in which they can deliver is by charging substantially more for babies, one-year-olds and two-year-olds. There is a real concern that if the provision goes through without the adequate funding, the Government will be putting us in a position whereby women returning to work after maternity leave will not be able to afford childcare because the costs for younger children will rise sharply and dramatically.

[Chloe Smith (Norwich North) (Con)]

I just have a small point, which I am sure will set us up in this debate and in anything else that we may say later. I think we could all agree that childcare is not only about women returning to work. In the 21st century, it is about both parents—men and women—being part of their child’s upbringing and part of the economy of the household.

[Pat Glass]

It is, but one problem is that the Bill has come through as an education Bill; yet, this small Bill with a few clauses largely appears to be an economic Bill about getting people back into the workforce. I do not see children anywhere in the Bill. Children’s development should be central to it . We should not be giving one at the expense of the other.

--- Later in debate ---

[Jess Phillips]

I totally agree. Without a proper funding structure, if the clause stands part of the Bill, we will need a real focus on quality. Any one of us who has ever left their children with a childcare provider wants to know that their kids are in the best care possible. For those of us who can afford it, sometimes the best care costs a bit extra.

Will the Government commit to a review of the rising cost of childcare for children aged nought to three, and of the issue of women dropping out of the labour market while their children are that age? Will they adjust the funding scheme accordingly if it is found to affect families negatively? For the same reasons, will they also review the rising cost of wrap-around care? The same private sector providers will often provide before and after-school transport as well as the 30 hours of childcare. If there is a shortfall, there will be a knock-on effect for all nursery costs.

To further assess whether the Government have their sums right, they could conduct a simple review of the number of places in the private sector and, more importantly, the maintained sector, when the 30 hours provision comes into being. My children both received 2.5 days a week of free early years education for a year, in a brilliant maintained nursery setting attached to the school that they both now attend. The nursery operated 45 places for school hours on Mondays, Tuesdays and Wednesday mornings, and a further 45 places for Wednesday afternoons and school hours on Thursdays and Fridays. I do not know why more nurseries do not do it like that, because it seems much better for parents. Having 2.5 hours each day seems as useful as a chocolate teapot to me.

The nursery building that my children attended simply could not manage 90 children for the full 30 hours of a school week. No matter how tiny their little bottoms are on the mats, there is no way that 90 children would be able to go there Monday to Friday. That means that the brilliant, highly sought-after maintained nursery where I live, which is helping many disadvantaged children, has a brilliant special educational needs service and offers a service to disabled children, will go from being able to offer 90 places to, most likely, being able to offer 45 places. That will reduce the availability of childcare in an area where it is really needed.

We cannot just say that we will build extra room on the side. Not only will the £500 million that has been allocated for capital funding not touch the sides for the whole country, but there just is not enough space in city schools such as the one my children attend. Last week, I visited Yardley primary school in my constituency. It is being pushed to go to five-form entry. I imagine that the idea of a five-form entry primary school is probably not that likely in the constituencies of most Conservative Members.

[Chloe Smith]

I welcome the point the hon. Lady is making about the need for space. I represent an urban constituency, just as she does, so I have heard the point made before. Nevertheless, does she not think that the capital funding could be well targeted to help where it is most needed?

--- Later in debate ---

[Jess Phillips]

I think we have time to do that before the roll-out in 2017. I do not wish to delay it any further than 2017, and the Government have the time to make it right. On the training of staff, speaking from personal experience—my son has special educational needs; he has Asperger’s—I want to ensure that people who work with children such as my son every day have the training, qualifications and skills to make their lives and his life a little simpler, although I have not managed it yet.

[Chloe Smith]

The hon. Lady is being generous with her time. She argues that the capital funding will not help the private sector. We all recognise that the taxpayer cannot always help the private sector. There is an argument that when a business is successful, it should work on its own merits. Does she agree that the policy proposal in the Bill is a major business opportunity, and that we should encourage the private sector to see it as an investment opportunity in our constituencies?

[Jess Phillips]

I would agree, if the private nursery sector—I have spoken to nursery staff in my constituency—felt anything other than concern about the funding envelope. That is the main thrust of my argument. If it is left with shortfalls, that is a big risk to take in a difficult economy. I absolutely want new nurseries to spring up and take entrepreneurial risk; we need them to meet the demand, so I would be delighted if they did that. I hope that the Minister and the Government prove me entirely wrong and that loads of brilliant nurseries spring up in spaces where they did not exist before and can afford to offer brilliant childcare that allows women to go back to work, but at the moment I do not see that in the detail of the proposals.

--- Later in debate ---

[Christian Matheson]

There will be many beneficiaries of these proposals. I welcomed the hon. Member for Norwich North saying that fathers will benefit because we are moving, although perhaps not as swiftly as we might like, into an age in which fathers have more childcare responsibilities. My hon. Friend the Member for Birmingham, Yardley made the good point that the gender pay gap will continue as long as we have a greater emphasis on maternal childcare, but I will not go into that as we are not on that topic at the moment.

One area that the review might take into account is the effect on providers. If the Committee will allow me, I will quote a constituent, and I may write to the Minister in greater depth about this particular case, because it is quite detailed. There is consternation—or concern, perhaps—that the numbers do not necessarily add up for providers. My constituent tells me that the reality of the current proposals is that

“each hour of extra funding”

for his nursery in Chester

“would mean a potential loss of £1.10, so that’s £16.50 per week per child.”

He continues:

“We have 35 registered children currently, which equates to £577.50 per week, times 14 weeks in this term,”

which means

“£8085.00 per term, or £24,000 per year.”

Those figures are losses due to the shortfall for providers. I do not expect the Minister to respond to that particular case now and I apologise for putting him on the spot without having written to him first, but the example illustrates the concern among providers that the numbers do not add up. A review that included providers would at least give us reassurance, or might identify a problem that needs addressing.

My constituent went on to write:

“The implications of this, coupled with increased rates, fuel costs and the… proposals to increase the national minimum wage, will put the pressure squarely on the providers shoulders, meaning they will either not be able to provide the level of care each parent rightfully demands, or it could even put them out of business”.

[Chloe Smith]

Does the hon. Gentleman agree that there is a problem in some parts of the country with local authorities not passing on as much of the funding as they ought to? I welcome the spreadsheets with which we have been provided to show that that is happening across the country. As I said on Second Reading, Norfolk County Council holds back 8% of the funding, whereas the figure elsewhere in the country is fractions of that, and I think that that is wrong.