Childcare Bill [ Lords ] (First sitting)

Christian Matheson Excerpts

Tuesday 8th December 2015 Public Bill Committees

[Jess Phillips]

Perhaps they did not realise and thought the subsidies were bigger. As I said, I would be delighted if the Minister proved me wrong. However, I can almost guarantee that for the next five years after the roll-out, we will see a higher-than-inflation increase in the cost of childcare for parents of children aged nought to three. I really hope I am wrong, but something will have to give. I do not run a nursery, so I do not know—I am basing my comments on the evidence that has been given to me that there will be a massive shortfall. Maybe I will start a nursery—I like to take on new tasks.

As a parent, I know about the effect of growing demand. This year I was one of the many hundreds of thousands of parents who were told that they could no longer access childcare. There may be an increasing number of places and delight about the figures, the graphs and reports that we read, but the reality is different. I was told I could no longer access the childcare I have accessed for my children for years, because demand outstripped supply. That is happening to people every day, regardless of what the figures say. Supply is not growing to meet demand. I currently have no childcare before school for my children, which has fundamentally changed my family’s working habits. It has meant a reduction in the income of my husband, who is the full-time carer of my children. No chart or table will tell me that is not happening when I know it is—it is happening to me and to many other parents I speak to on the school run.

I want to be sure about the graphs, the funding and schemes that are being outlined. All I am asking for is a review of whether the funding will work. As I have said repeatedly, I want the Minster to prove me wrong. I want a review of whether there has been any rise in the costs of wrap-around childcare for children aged nought to three and those over four, like my children, and of how many women fall out of the labour market when their children are aged nought to three. I want to understand whether the Government have got their figures right.

[Christian Matheson (City of Chester) (Lab)]

I apologise for making the schoolboy error earlier of not turning my phone to silent and therefore disrupting the Committee. I meant no disrespect, Ms Dorries.

I would have expected the Government to welcome the opportunity of a pause and a review because it would provide a breathing space for them to dig themselves out of a hole. We should remind ourselves of the genesis of the policy of 30 hours a week of childcare which, in common with my hon. Friend the Member for Birmingham, Yardley, I genuinely welcome. The political genesis of the policy was that my party had offered a fully costed and prepared proposal for 25 hours a week, and the Conservatives entered the general election campaign determined to trump that with 30 hours a week, yet without doing the sums to work out where the money would come from, so I would have expected the Minister to welcome the proposal for a review and pause.

[Alex Cunningham]

Will my hon. Friend give way?

[Christian Matheson]

That would be handy, because I need to read something from my iPad, which has turned itself off.

[Alex Cunningham]

I am not sure that that was the role that I had intended to undertake.

The Government have said 30 hours, which trumped our 25 hours, but is that not to be welcomed? An extra five hours a week is a tremendous figure. We want the scheme to work, but we want it to be funded, and all the organisations are saying that there is not enough money and that the estimates are based on the wrong data. The Government need to get it right so that we can all celebrate the wonderful fact that the Tories have trumped the Labour party.

[Christian Matheson]

I thank my hon. Friend for that intervention. I also thank the Minister for, and congratulate him on, the extension to 30 hours, which will be welcomed by parents up and down the country, as long as it works. I do not wish to be churlish and I hope that my comments will be taken in the spirit with which I offer them.

[Mr Gyimah]

The hon. Gentleman is right to point out that both main parties promised to increase the free entitlement for three and four-year-olds at the election, with the Labour party saying 25 hours and the Conservatives saying 30. However, we were the only party to commit to two things: a review of the cost of providing childcare; and an increase in the hourly rate. I did not see a reference to any review or increase in rates in the Labour party’s manifesto. We did not just make a promise; we are delivering. What is the basis for the hon. Gentleman’s claim that our pledge cannot be delivered, but Labour’s could have been?

[Christian Matheson]

I remind the Minister that the Labour party’s proposals—I appreciate that we are not discussing them, and I know your keenness that we stick to the Bill, Ms Dorries—were fully costed. My suspicion is that the Government’s proposals were not costed at the time, but I do not want to provoke your ire, Ms Dorries, so I will not make the same mistake as other colleagues—

[The Chair]

Order. Please stick to the amendment.

[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.

[Christian Matheson]

I deliberately did not want to quote the whole of a long and quite complicated email from my constituent, but he makes a similar point. I have to say that my local authority of Cheshire West and Chester Council has just had £47 million taken off its annual budget by the Chancellor.

[The Chair]

Order.

[Christian Matheson]

Indeed, Ms Dorries.

[Mr Gyimah]

rose—

[Christian Matheson]

I am very close to the end of my speech but, of course, I give way to the Minister.

[Mr Gyimah]

I want to draw the Committee’s attention to a point made by the hon. Member for Birmingham, Yardley about the cost of childcare and low funding rates. Central Government give Birmingham £5.49 and it pays £3.83 to providers. If there is a challenge around childcare in that area, it is not because the Government are under-funding childcare, but because of what the local authority is top-slicing. Of course it has to top-slice, but I would like to know why there is such a gap for Birmingham.

[Christian Matheson]

The hon. Gentleman makes a good point, but a Minister talking about funding for local authorities as a whole will be skating on thin ice, because such funding is not a good story for the Government.

The Minister may want me to write to him with more details about the case I cited, but childcare providers’ concerns need to be addressed. The review under the clause would give the Government breathing space to ensure that the numbers add up and could reassure providers who are working hard to offer a quality service to parents in my constituency and others.

[The Chair]

I call the Minister.