Monday 9th March 2020

(4 years ago)

Westminster Hall
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David Simmonds Portrait David Simmonds (Ruislip, Northwood and Pinner) (Con)
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Thank you, Mr Davies. I crave your indulgence: this is the first time that I have contributed to one of these debates, so please forgive me if I do not follow the protocol exactly. I am sure you will be quick to draw to my attention any failings on my part, as the Minister was when she kindly pointed out that I had sat on the wrong side of the Chamber when I came in.

This is a timely opportunity to discuss these issues. As one of the many parents directly affected by them—I have two nursery-age children—when I heard the list of issues that the Government need to consider, it resonated with me. Having had those discussions about how best to allocate the cost of childcare, what impact the costs would have on two working people, and whose salary and career prospects would be most impacted, those issues feel very personal, and I know they are on the mind of my constituents in Ruislip, Northwood and Pinner. I will reflect back some of the solutions and points that arose in my time in local government, as I was responsible for this issue both in my local authority of Hillingdon and, to look at the bigger picture, at the Local Government Association, which represents local authorities.

I will start with the cost and its impacts. When the free childcare policy was first implemented, one of the debates that local authorities had with the Department was about the fact that, as is clear from providers’ feedback, the funding that comes through this mechanism is unlikely to be sufficient to ensure that childcare is always free to the user. I have spoken to a number of the Ministers who have been responsible for this area over the years, and they have been very candid about this. The fact that the commitment was in a Bill meant that they needed to speak of that childcare as free, but providers recognised that there was scope to charge for elements of childcare, such as nappies, food and trips—elements quite explicitly laid out in the legislation—which those of us paying the monthly bills would assume were part of the overall cost. That made it a slightly different conversation.

It is fantastic that the Government have invested in providing what is, in practice, a massive subsidy for childcare—about a 90% subsidy in most places. However, there will always be an ongoing debate when, although we talk about something being free, families have to pay an additional contribution to secure the hours—although for most parents, the funding covers the cost of the care that, in the Department’s analysis, it is intended to cover. My children’s nursery and many others, recognising the fact that the free element is term-time only, have spread that time out, so that in practice it becomes a subsidy over the course of the year. That is extremely welcome, given the overall cost of childcare, but clearly it leads to this dilemma whereby people expect it to be free but it is not, although it is heavily subsidised.

It is important to consider this in context. I was the local authority’s lead member on this during the previous Labour Government, when the tax-free voucher schemes were being rolled out and accessed through many employers, particularly large ones such as local authorities. The Government have maintained some of that momentum by seeking to make the benefits of those voucher schemes available to a much larger cohort of people through the tax-free childcare programme, which is at the very minimum a significant subsidy of the cost. The roll-out of those programmes has not been without teething troubles—I am one of many parents who experienced frustrations in accessing the tax-free childcare service and making sure that payments due under that scheme were made on time—but they have been of significant benefit to many mums and dads the length and breadth of the country, and reflect the Government’s considered policy position, which is to ensure tax-free childcare arrangements are focused on supporting people who are accessing work. I hope that gives the strategic picture on financing.

I turn to the local authority sufficiency duty, what it means in practice and how it affects the market. For a long time, local authorities have played a significant role in the provision of high-quality childcare at a local level, going back to the neighbourhood nurseries initiative in the late 1970s. Currently, that role is expressed via the sufficiency duty. It is important to be clear that the duty involves the planning rather than the provision, although many local authorities, including mine, both provide childcare under the policy and work with local providers to ensure that sufficient places are available.

A number of challenges arise from that, especially for children who have special educational needs and disabilities. As I know from personal experience, it is often only through the local authority that children with significant medical conditions can access nurseries, because it has sufficient resources in the background to provide the training, and the experienced staff who know how to deal with complex medical conditions in a way that a private profit-making provider may struggle to within the funding envelope.

The Department’s finance guidance clearly expresses the expectation that there be a minimum pass-through rate of funding of 95% for local authorities. In many cases, local authorities passport a significantly higher rate of funding; in Kent County Council, the rate is 99%. In a number of local authorities, 100% of the funding from the Department is expressed in the funding rate paid per hour to providers.

There is a challenge around that. It would be helpful for the Minister to consider in the round, although not necessarily straightaway, the role of schools forums in the distribution of funding. The early years block is one of the three main components of the ring-fenced dedicated schools grant. The local authority is not permitted to deduct resources from the grant, although schools forums have some discretion in how the 5% for overheads may be used. In most cases, because of the capacity and planning issue, it is used to ensure that free training in paediatric first aid and resuscitation is available to local nursery providers. It may also be used for up-front grants for nursery providers who are seeking to expand, and who need money ahead of time to recruit staff, so that they have enough people, under the child-staff ratios, to take extra children into that setting.

As any local authority will say, schools forums tend to be dominated by the voices of large secondary schools. For the most part, the early years sector is fragmented and made up of many small private providers, so it is hard for it to bring the leverage to the discussions that secondary headteachers can bring, who are supported by large unions and research organisations. In practice, therefore, many debates at schools forums focus on how to distribute the secondary school money, with only a passing glance at what happens in early years. The view among secondary heads is often that an early years underspend is good, because if that persists, it justifies the redistribution of money into secondary school budgets.

Katherine Fletcher Portrait Katherine Fletcher (South Ribble) (Con)
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I spent some time with the Children’s Commissioner’s early years board in the last couple of weeks. The importance of making a great start and having a cohesive response, from a nursery or somewhere else, was heavily emphasised. I ask the Minister to understand the number of families with children in the gap between nine months and two years, and how many are directly affected before the Government funding kicks in, and to examine the opportunity to provide targeted support in that area to troubled families through family hubs or children’s groups.

David Simmonds Portrait David Simmonds
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My hon. Friend makes a good point, which I will touch on in my concluding remarks. Too often, that issue has been absent from schools forums’ deliberations about the distribution of funding. We hear repeatedly from primary and secondary heads that they would like more to be invested in the early years, but when it comes to the practical decision-making that would ensure that money got to the sharp end to deliver the benefits that she touched on, the drive is often absent.

It is important that the Department’s guidance and messages to schools forums appropriately consider the value of early years education. Money spent there has the biggest impact on a child’s life prospects, and the arguments about disadvantage have been well rehearsed, so I will not cover that. In the language of priorities, childcare can be expressed as an issue about enabling people to access work—as purely economic: “money in, productivity out”—or, which is more complex, as something through which we seek to measure the impacts that specific early interventions have on a child’s life.

Anecdotally and from research, we know that access to high-quality early years education is hugely beneficial over a child’s life, more so than money spent on young people of sixth-form age. It is harder to identify, however, which specific interventions yield the most value. From my experience as a trustee of the Early Intervention Foundation, which I have been at since its inception, although I have now stepped down, I know that a challenge of the Sure Start programme was that money was spent on many things that were popular and well-received by parents, but there was a real lack of evidence that they effectively tackled the issues in the communities for which the money was provided. As a result, there has been a growing interest in identifying through research, by using the gold standard of a randomised control trial, which interventions should be chosen by an individual centre or by a local authority when it is planning that provision in a local area. As we begin to look at the development of family hubs, to which my hon. Friend the Member for South Ribble (Katherine Fletcher) referred, we need to identify the things that not simply were popular and well regarded in the past, but will actually change outcomes for children in the medium to long term.

The work of the Early Intervention Foundation and the other What Works centres founded by the Department to look at each of the different life stages gives us the opportunity to make much better decisions than in the past about how the Government deploy those resources. As a Conservative, I am interested in the efficiency of public money, but having been there from the inception of Sure Start, through its implementation and the days when it was extremely well funded, back to now, when we are looking at winding back some of that activity, I would like there to be a focus across the activity of the Department and the Government on demonstrating what leads to an improvement in outcomes.

I hope that gives a flavour of what I learned in the world of local government. The Minister is listening attentively, and I know from discussions with the Department that it is an area of great interest for a variety of reasons, so I look forward to her response.

--- Later in debate ---
Vicky Ford Portrait Vicky Ford
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I am aware of that report, but it is extremely important that we give credit to the early years workforce for ensuring that the attainment gap at the start of the school years has narrowed, because when there is a gap, there is a risk that it will widen during each individual’s school years.

The early years workforce plays a key role in the delivery of high-quality early education and childcare. It is a testament to that workforce that 96% of childcare settings—or 19 out of 20—are now rated “good” or “outstanding” by Ofsted; that represents an increase from 74% in 2012. Our investment in the early years entitlements not only allows us to support high-quality early education, helping children to thrive in the crucial early years, but helps us to make childcare more affordable, supporting more families to work. We are continuing to increase our investment in childcare to support parents to work.

The Government plan to spend more than £3.6 billion on the early years entitlements in the coming year. That includes the universal 15 hours of childcare for all three and four-year-olds, which was introduced in the early 2000s; the entitlement to 15 hours of free childcare a week for disadvantaged two-year-olds, which was rolled out in 2013 under the Conservative-led Government; and the additional 15 hours for working parents of three and four-year-olds, which was introduced in 2017—again, under a Conservative Government. Those entitlements save parents up to £5,000 per year in total if they use the full 30 hours of free childcare available. The Government’s manifesto at the last general election committed to investing a further £1 billion to create more high-quality wraparound and holiday childcare places. I have noted the challenges of holiday periods that hon. Members have mentioned.

All three and four-year-olds, and the most disadvantaged two-year-olds, benefit from 15 hours a week of free early education, regardless of whether their parents are in work. The entitlement for two-year-olds is in place to help to give the most disadvantaged children a great start in life by closing the attainment gap between them and their better-off peers.

The Department for Education’s study of early education and development, or SEED, and the study of effective primary, pre-school and secondary education, or EPPSE, are clear that good-quality early education at the age of two has a variety of positive benefits for children. I believe in evidence-based decisions, however, and evidence from the EPPSE also indicates that children who start pre-school under the age of two do not show more positive outcomes than those who started between the ages of 24 and 36 months, which is why we targeted the policy at the most disadvantaged two-year-olds. It is extremely encouraging to see that more than 850,000 two-year-olds have benefited from an early education place since the scheme began in 2013.

Achieving a good level of development is important. It is excellent news that three out of four children are reaching that level, because children who do not are more likely to have an education, health and care plan or to become children in need. That is why we have announced a range of initiatives to support disadvantaged children, including a significant investment in professional development for early years practitioners and the development of the evidence base for what works in the early years. I hope that that addresses the point raised by the shadow Minister, the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy), about the importance of supporting professional development in the early years sector. A range of initiatives are under way.

Capital funding is also important. We have allocated £24 million to build more school-based nursery places in deprived areas. That supports our commitment to social mobility, ensuring that we provide more quality places for those who will most benefit.

Early language has a major impact on all aspects of young children’s non-physical development, contributing to their ability to manage emotions, communicate feelings, establish and maintain relationships, think symbolically, and learn to read and write. The evidence is clear that children who start school behind stay behind. Children with poor vocabulary skills at the age of five are twice as likely to be unemployed when they reach adulthood, and three times as likely to have mental health problems.

We want to enable more parents to support their child’s early communication, language and literacy development at home. The Department for Education has launched the hungry little minds campaign, which I hope all hon. Members present will help me to champion. That three-year campaign aims to encourage parents to chat, play and read with their children to help to set them up for school and beyond.

As part of that campaign, the Department for Education recently awarded a quality mark to eight early years apps with a focus on literacy, language and communication. That comes after new data revealed that three quarters of children aged five and under had used smartphones or tablet apps at least once in the past six months to learn. A panel of experts recommended that the apps should be accredited to help parents to make informed decisions about the use of technology in creating a positive learning environment at home.

As well as improving children’s outcomes, the availability of high-quality childcare is a key factor in enabling parents to work, a subject that has been raised a number of times today. The 2018 Office for National Statistics report on families and the labour market in England shows that many parents return to work and need childcare when their child turns three.

The primary focus of the 30-hour childcare entitlement is to support all working families with the cost of childcare, and to support parents to go back into work or to increase their working hours, if they so wish. As I said, 600,000 three and four-year-olds have benefited from a 30-hour place in the first two years of delivery, helping parents to keep more of their salary through the doubling of free childcare. According to the Department’s independent year-one evaluation, the 30-hour policy is making a real difference to families’ lives, with many parents reporting that they now have more money to spend. In our most recent parent study, which was published last December, the vast majority of parents—80%—said that their family’s quality of life was better since using the 30 hours. We are clear that the 30-hour offer aims to support working families with the cost of childcare and to support parents to go back into work or to work more hours, should they so wish.

A point was made about gender pay equality and support, especially for mothers returning to work. The Government’s parental leave, flexible working and childcare policies all work together, and they have supported a closing of the gender pay gap. Back in 1997—that was before I had my first child—the gender pay gap was 27.5%. The last number we have is for 2018, when it was 17.9%. Over the past two decades, there has been a really significant improvement in employment for mothers. The maternal employment rate has gone up from 62% in 1996% to 74% in 2018. There is more to do, of course, but I ask Members to please recognise the huge improvements that have been made with the gender pay gap and maternal employment.

Early years entitlement supports families with two, three and four-year-olds to work more hours and supports their children’s development. Other childcare offers across Government support families with younger children. It is important to enable parents to spend more time with their children in the very early months and to allow families more flexibility to find the right balance for them. That is why the Conservative Government introduced shared parental leave in 2015. It has given parents the chance to share up to 50 weeks of leave and up to 37 weeks of parental pay in the first year following the child’s birth or adoption.

My hon. Friend the Member for South Ribble (Katherine Fletcher) raised the issue of family hubs. I am positive about family hubs and, in fact, visited the hub in my constituency last Friday. I was deeply impressed with the support that it gave to families across a wide age range, and for the nought to three-year-olds especially. I would like to see more family hubs opening across the country.

My hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds) made a large number of really important points, as ever. He brings great experience to this House. First, he spoke about special educational needs and disabilities. He knows that we are in the midst of a review of the entire SEND system, but our disability access fund is worth £615 per eligible child per year. All local authorities are required to have special educational needs inclusion funds for all three and four-year-olds with SEND who are taking up the early years entitlement. A two-year-old in receipt of disability living allowance or an EHCP—education, health and care plan—would also be eligible for the universal 15-hour entitlement.

David Simmonds Portrait David Simmonds
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The Minister covered a number of the key issues in her speech. Does she agree not only about the benefit from the early years pupil premium, which helps to boost the funding rate, but that it is important for the Department for Education to put pressure on the Department of Health and Social Care? One of the consistent issues for children with special educational needs and disabilities is that local authorities have for many years been doing statements for children with special educational needs and are used to that process, but local NHS colleagues who are required to contribute towards the clinical and medical aspects of a child’s early years experience do not have any history of doing so at the local level. In fact, I am sure that many Members find, when we investigate SEND casework in our constituencies, that the blockage behind getting a child what is needed sits with the local NHS provider, rather than with the local authority.

Vicky Ford Portrait Vicky Ford
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My hon. Friend absolutely hits the nail on the head. I have been in my role for two weeks and one day, and the issue of education, health and care plans has been raised a number of times. SEND review is right at the top of my list of priorities. The plan is meant to cover education, health and care—that was a huge step forward in the 2014 reforms—and it needs to ensure that they are all delivered. I have a meeting scheduled with my counterpart, the Health Minister, but the Health team seems rather busy at the moment. However, it will happen, and we will look at those plans as part of the review.

My hon. Friend also raised the important issues of the school forums, which I will look into, and of tax-free childcare. I was quite disappointed that neither of the two Opposition speakers mentioned tax-free childcare, because it is an important introduction that helps up to 1.3 million families whom we estimate could be benefiting.