Cost of Child Care

Kate Green Excerpts

Wednesday 20th November 2013 Westminster Hall

[Bridget Phillipson]

A significant body of evidence shows that pre-school years are critical to a child’s development. Despite that, pre-school child care is becoming inaccessible to an increasing number of families. The cost of nursery places has risen by more than 30% since the last election—five times faster than the rise in wages over the equivalent period. It now costs, on average, £107 a week for a 25-hour nursery place. Parents working part time on average wages now have to work from Monday to Thursday before they have paid off their weekly child care costs.

To make matters worse, all this has happened while there have been 35,000 fewer child care places than in 2010. The fact is that for many parents, especially single parents, there is no longer a viable choice. With prices rising faster than wages, thousands of parents are being forced to stay at home to look after their children when they want the opportunity to work.

[Kate Green (Stretford and Urmston) (Lab)]

Against that backdrop, is it not regrettable that, as part of their plans for universal credit, the Government intend to put the lowest-earning parents in the position of being helped with only 70% of their child care costs? Better-off parents, however, will receive help with 85% of such costs. Is that not perverse?

[Bridget Phillipson]

My hon. Friend makes an important point. She has consistently raised such concerns with Ministers and she continues to challenge the Government about them. Her point is of particular concern. We want to support the poorest families to access child care, but what she has mentioned will no doubt make that a lot harder.

The reality is that it is predominantly women who have been hardest hit by the rising cost of child care. Female unemployment is at its highest for a generation. According to the Office for National Statistics, more than 1 million women in the UK are out of work—an increase of 82,000 since May 2010. Affordable child care gives women the independence to make choices that are right for them and for their families. Every woman who is forced out of the workplace suffers a significant personal blow, while the rest of society loses her talent, knowledge and expertise.

As we heard in yesterday’s debate on this issue, the Government’s own social mobility and child poverty commission is clear that, for many low-income parents, cost, rather than quality, was the main factor in choosing child care. A recent survey by Asda showed that child care costs prevent 70% of stay-at-home mums from working.

I am sure that the Minister will agree that, in economic terms, it is absurd to lose the valuable contribution of women in the workplace. Higher unemployment rates increase the benefits bill and reduce tax revenues, while higher rates of women’s employment support stronger economic growth.

If the economic recovery is to harness everyone’s potential, the Government should ensure that work pays for all families. That is why Labour is proposing targeted measures to bring down child care costs. Our plan has two major components. First, child care for three and four-year-olds will be extended from 15 to 25 hours per week for working parents. That support will be made available both to single-parent working households and two-parent households where both parents work. Those plans will be fully funded through the bank levy.

In the last financial year, the banks paid a staggering £2.7 billion less in overall tax than they did in 2010, while over the last two years the Government’s bank levy has raised £1.6 billion less than they said it would. I hope the Minister agrees that, at a time when resources are tight and families are under pressure, that cannot be right.

The second component of Labour’s plan will be a focus on the primary school guarantee. Some 62% of parents with children of school age say that they want to be able to combine working and family life. For that to happen, they need to be able to access care before the school day begins, after it ends and during holiday periods. Nearly 30% of those who need such care were unable to find it. That is unacceptable.

Research from the Minister’s own Department backs that up. In September 2011, the Department published research highlighting that extended services provision can have an important positive impact on children, families, communities and schools themselves. Under the previous Government, 99% of schools provided access to breakfast clubs and after-school clubs, but more than a third of local authorities have reported that that has been scaled back in their area in the past three years. That is why Labour will legislate to guarantee that parents can access child care from 8 am to 6 pm if they choose.

Tackling the cost of child care is only one part of the solution. We must also consider how we can improve its availability and accessibility. Evidence shows that families from lower-income backgrounds, including in parts of my constituency, are among the least likely to use formal child care. We need to help our constituents understand the support that is available and how they can access it, along with the benefits that can come from having a child in nursery or child care provision. Furthermore, many parents in my local area work shifts, so child care services must become much more flexible to meet their needs and the circumstances of their employment.

The location of child care services is another important consideration. For many people in my constituency, transport is a major problem, owing to a lack of train services and a limited and expensive bus network, and I have been campaigning to change that.

We need a joined-up approach to child care. We need health visitors working with housing and child care providers, and councils working with the Government. Of course, families will always have the freedom to make arrangements that best suit their circumstances, preferences and needs, but the Government’s role is to ensure that every effort is made to provide support that is affordable and available when needed and accessible where needed.

Labour is the only party listening to parents and acting on their concerns. Child care is as important to the future of this country as investment in infrastructure. High-quality child care is key to tackling child poverty and improving social mobility. Labour has a clear plan for delivering that. It is the right thing for families, and it is the best thing for our country.

--- Later in debate ---

[Dr Coffey]

My understanding is that the provision has grown in that time. I am sure that the hon. Lady will correct me if she thinks I am wrong. I meant “grown”, not “groan”, unlike the joke yesterday.

Returning to affordability, there is no doubt that the cost of child care has risen significantly. Some of that will have been due to supply and demand; there is no question about that, where demand exceeds supply. It is important to expand the number of child minders to help with that.

One of the things that the Government are doing right is allowing schools to shed some of the regulatory burden on the ability to provide a wider range of child care opportunities on site. Labour suggests that legislation is required to have a primary school guarantee, but I do not believe that. What is important is that a school should not have to register separately with Ofsted if it offers provision for under-four-year-olds or that it should not need such tight planning when it wishes to expand. The same should apply when existing nurseries of good and outstanding quality wish to expand.

We are changing things so that Ofsted-registered and good or outstanding nurseries will start to receive funding directly, cutting out the recycling of money through the local council. That is another good measure to accelerate the needed provision of high quality child care.

Another good thing—the Minister may talk at more length about some of these—would be to streamline qualifications for early years, instead of having a choice of about 400 potential qualifications. In that way, parents could readily and easily check the quality rather than have to do their own research. Having an accreditation with fewer qualifications is a streamlining simplification that will help not only providers of child care but parents to make an appropriate assessment of what the right thing is.

On the cost of child care, I think the Government accept that having some of the most expensive child care in Europe—we are second highest behind Switzerland —is not sustainable. We need to address that. Coming from a Conservative tradition, I would try to do that not just by constantly upping the subsidy, but by providing wider choice, which will bring down cost. However, I commend the tax-free child care scheme, which will be available to working families.

I am sure that Government Members would be delighted if we could persuade the Chancellor to bring that scheme forward by a year, but I accept the fiscal constraints under which the Government operate. In any case, I am pleased that the scheme will be forthcoming in April 2015. That is a real positive for working mothers and fathers.

Other useful measures that the Government are introducing include shared parental leave. I understand that our coalition partners are keen to extend that even further; that is a debate for another time. I am pleased that we are pressing forward with that important development, and I am sure that Opposition Members welcome it too.

The reason why I do not think we need legislation to implement the primary school guarantee is that we can just get on with the scheme if that is what primary schools wish to do. We may require a statutory duty to force that to happen, and we have to consider that, but I see leading schools providing it already.

One point that I made yesterday is key. Governing bodies should work with head teachers and parents to ensure that the school day is not artificially reduced simply to have as short a lunch time as legally possible, but to ensure that time spent at school is available for extra-curricular activities and to be mindful of the fact that parents are working.

On Sure Start, we can have the back-and-forth. I have not had time since yesterday’s debate to go into the full detail, constituency by constituency, on the back-and-forth about whether 500 or just 45 have closed. As I said yesterday, I am happy to rely on the Minister’s assurance.

We are talking about choices. Yesterday, the hon. Member for Newcastle upon Tyne North (Catherine McKinnell)—I got that constituency right—talked about the level of cuts, an issue referred to today by the hon. Member for Houghton and Sunderland South. I have looked briefly at the website of the Department for Communities and Local Government. Using the spending power formula, which the Local Government Association recommended to the Government, I am able to say that spending in Newcastle upon Tyne has gone down by 1.4% this year; in Sunderland by 1.5%; and in Middlesbrough —I see that the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) is present—by 0.5%. I did not have time to look at Wolverhampton.

Those figures come from the spreadsheet that I have opened. Meanwhile, spending has decreased in Norfolk by 1.6% and in Suffolk by 2.1%. In spite of that, Suffolk county council is keeping open its Sure Start centres. Yes, the management of some centres has been merged. The two in Felixstowe are run by one lady, the magnificent Jennifer Clarke-Pearson, who is working hard with families in Felixstowe to make that happen.

As I reiterated yesterday, it is important that in this wider debate about public services, which my hon. Friend the Member for Norwich North (Chloe Smith) mentioned, we must ensure that front-line services are protected—as constituency champions, all hon. Members in this Chamber will continue to do that. However, we should not get hung up solely on bricks and mortar. We must focus on the outcomes.

[Kate Green]

I agree that we should not just focus on bricks and mortar. However, although centres in my local authority in Trafford are being merged, as the hon. Lady described, the availability of services has been significantly reduced. A number of programmes that were appreciated by families, some of which were available universally in the past, are now not available.

[Dr Thérèse Coffey]

I am genuinely sorry to hear that; I am not being flippant. It is important that local councils continue to provide valuable services that are doing good for local families, but, again, sometimes the Whitehall solution does not always work in the constituency or council area. The Department for Education issued statutory guidance in April to try to encourage councils and children’s centres to refocus—not on universality, perhaps, but on the families that Sure Start was originally set up to help.