Free Childcare

Jonathan Reynolds Excerpts

Thursday 12th October 2017 Westminster Hall

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

I thank my parliamentary neighbour, my hon. Friend the Member for High Peak (Ruth George), for securing this debate, because investing in quality, sustainable and affordable childcare is, quite simply, the best investment a country can make. It enables children to excel and fulfil their potential, and parents to get out to work and fulfil theirs. It enables communities to become more economically active and more highly skilled, and offers the taxpayer immediate savings in benefits expenditure and in the long-term cost of the NHS, the education system and so on.

I am not usually delighted by Conservative manifestos, but when the Conservatives added a pledge of 30 hours a week of free childcare to their 2015 manifesto, I have to confess that I was delighted to see them nick one of Labour’s best commitments. It meant that, whichever party won the election, childcare was about to become more affordable and more accessible for struggling parents. If ever we should have consensus in an area, it is in this one.

As a parent of a nursery-age child myself, I declare an interest. I have also put three older children through nursery, so I can absolutely relate to the thousands of parents for whom the costs of childcare push household finances to the brink. As Members of Parliament we are all paid on very generous terms, but even so, when my youngest two children were in nursery at the same time, the monthly bill came to more than our mortgage, so the need to get this policy right is paramount. That is why I am so bitterly disappointed that the Government have failed to put their money where their mouth is.

I asked parents and childcare professionals in my constituency to send me their early experiences of the policy. Three clear problems emerged: first, local nurseries and childminders have an unsustainable raw deal financially; secondly, the registration system is chaotic and unfit for purpose; and finally, the eligibility criteria for the scheme are far too strict.

Let me start with the terrible deal that nurseries have been dealt and the dire consequences of that. The amount that the Government have given local authorities to provide these supposedly free hours is simply not enough. It does not cover the cost of wages, premises, utilities, food or learning resources. One outstanding nursery told me that it was losing £500 per year for every free 15-hours place. That will double to an impossible loss of £1,000 per place when extended to 30 hours.

Nurseries that offer the 30 free hours are left at risk of closure because they lose money for every hour’s childcare they provide, but nurseries that do not offer them are at risk of closure because parents will, understandably, choose to go elsewhere. Almost all nurseries are therefore being forced to cut costs, and it is children who pay the price. Given that there is a proven link between the amount that staff are paid and the likelihood of a nursery being rated outstanding, a race to the bottom is clearly bad news for staff, kids and parents alike.

The registration system for parents is far too complicated. My constituent Cat applied online in April. The nursery asked for her code, which had not yet been provided. That code took 10 days to arrive, by which time the nursery was told that it had expired. She has repeated the process several times now, with endless phone calls and emails, and is now anxiously waiting to find out whether her application for her child’s place has been successful. That seems a bizarre set of hoops to have to jump through to gain a funded place at a nursery her child is already at.

I have constituents who are not entitled to these free hours because the Government do not deem them to be eligible. They include John and Nicola Andrews from Dukinfield. John works full time, but Nicola is a trainee midwife. Although she works an excess of 40 hours a week practising and studying for the NHS, because that is unpaid, she is not deemed to be a fit candidate for free childcare. This woman is working hard in a valued public service, but we are not going to help her with her childcare—Minister, that is wrong.

Likewise, I have constituents not in work who would like to return but cannot apply for jobs and attend interviews without childcare being in place. We should simply be offering free hours to parents whether they are in work or not, which is the Labour party policy and should become the Government’s policy too.

Minister, please listen to these concerns. Do not hide behind reports from two years ago. This is a mess and it needs to be sorted out for a better deal for parents, providers and, most importantly, children up and down this country.

--- Later in debate ---

[Mr Goodwill]

As the hon. Lady points out, we have tranches of entry, so anyone who has an offer in August for a job that will start in September could get a code. The situation is similar for people who want more hours. We have been as flexible as possible in ensuring that those codes can be given. We take people’s word for it that their job offer is real, but when they confirm the code it becomes apparent.

This provision builds on the existing 15 hours a week of high-quality early learning that workless households of two, three and four-year-olds are entitled to. We know that starting education early makes a difference to long-term attainment and earnings, and that work is the best route out of poverty to transform children’s life chances. I heard this week from a school principal who had supported parents of two-year-olds getting the free hours to retrain and take up employment when their child became eligible for 30 hours. That is a fantastic outcome from a programme in its infancy. The 30 hours is making a real difference.

[Jonathan Reynolds]

I cannot believe that the Minister is not receiving representations that list the problems with this policy. Let me give him an example that I could not fit into my speech in the time available: my children’s school is ending free provision for under-fours, because the funding simply does not work as it has worked in the past. There is actually a net reduction in provision. Is he honestly saying that he is not receiving messages like that from around the country?

[Mr Goodwill]

I am surprised to hear that from the hon. Gentleman, because Tameside council in his area received a 25% increase in the hourly rate given after our review. We are putting our money where our mouth is.

As hon. Members will know, we rolled out the policy with a pilot that delivered for 15,000 children, and on 1 September, we rolled it out nationally, so that all eligible parents could join the 15,000 families in our pilot areas already benefiting from 30 hours. As expected, demand for the 30 hours offer has been high, and more than 216,000 parents have successfully received eligibility codes for the autumn term. I am pleased to be able to update the House: 90% of those codes have been checked by a provider on behalf of a parent seeking a 30 hours place. That is up 19 percentage points from 71% when I last reported, which is fantastic progress.

Of course, that figure may still continue to increase slightly, but I want to be clear that I do not expect it to reach 100%, because we cannot predict parents’ choices and situation. People’s circumstances will change. Not every person who successfully applied for a 30-hours code will decide to seek a free place for their three or four-year-old. Some parents will want to stick with a provider who does not offer 30 hours; other parents who applied for tax-free childcare and were eligible for 30 hours and who were issued a code will not want to take up that place because they might use the tax-free childcare offer. The figure may increase slightly, and I will keep the House updated.