Childcare and Early Years

Kit Malthouse Excerpts

Wednesday 8th March 2023 Commons Chamber

[Mr Walker]

My hon. Friend, on whose Select Committee—the Northern Ireland Affairs Committee—I am happy to serve, is absolutely right. I have learned a huge amount as a result of having children in childcare and early years settings and talking to the brilliant people who look after them. It is absolutely true that the people who work in this space provide that support. I also think that the Government’s family hubs intervention will be very welcome, particularly if there is outreach and support in the community.

When we take into account the stimulation for young minds, the benefits for parents and the impact on schools, the case for investment in early years becomes a win-win-win—and that is not all. We all know about the rising tide of demand for specialist and high needs support; the Minister was very frank about it in her statement on Monday. We all know that the early identification of need is vital to children’s life chances. Picking up challenges such as autism, speech and language difficulties and hearing or visual impairments early in a child’s life enormously increases their chances of managing their condition, getting the right specialist support in place and being able to engage with mainstream education.

If the Treasury ever wants to reduce the high needs deficits that beset our local authority budgets and simultaneously unleash the potential of more young people with special needs, it needs to understand that investment in early years and in the professions that can support, identify and meet needs in the early years is a must. Investment in the early years and childcare should therefore be a win to the power of four. There can be few sectors of the economy in which there is such obvious and compelling payback.

[Kit Malthouse (North West Hampshire) (Con)]

My hon. Friend is quite right to use the word “investment” in this context. Has he ever come across the Tangelo Park project in the United States, which has fascinated me for many years? A local philanthropist took over a neighbourhood in Florida that was plagued by crime and low achievement—what one would refer to as a rough neighbourhood. He made two offers to the population: he said that he would pay for universal, high-quality pre-school childcare and that anybody who got into college would get it free. Obviously people normally have to pay for college there, so that created an incentive. The project has been going for 20 years and has completely transformed the neighbourhood, which has become prosperous, crime-free and a lovely place to live. If we are interested in regeneration and levelling up across everything we do, investment is about not just the individual child and their family, but the area in which they live and their community’s sense of aspiration and purpose.

[Mr Walker]

My right hon. Friend makes an excellent point. We had a very interesting debate on the Levelling-up and Regeneration Bill about childcare as an infrastructural issue, which I think reflected those benefits. I agree that we need social entrepreneurs to invest and play a role in this space. The private, voluntary and independent sector, which currently dominates provision, is so vital. It is important for us to work with the sector and support it rather than placing it under the pressures that unfortunately we are seeing today.

This is a debate about departmental estimates, but I am first to recognise that not all spending on childcare and early years comes or needs to come from the Department for Education’s budget. Within that budget, however, we have seen welcome commitments to review and increase the local spending on funded hours. I am proud of this Government’s record of delivering both the targeted two-year-old offer for disadvantaged children and the 30 free hours for some working parents.

Evidence given to the Education Committee makes it all too clear, however, that those welcome steps are coming under real pressure from rising costs. Helen Donohoe of PACEY, the Professional Association for Childcare and Early Years, told us:

“The number of childminders has halved in 20 years. We project that by 2035 we will have only about 1,000 childminders left in the country. That is from 60,000 20 years ago”.

Dr Grenier, a nursery school headteacher, told us that

“roughly 10% of nursery schools have closed in the last 10 years and more are due to close soon.”

Kara Jewell, a nursery director, told us:

“In 2003 when I registered as a childminder our funding rate was £3.02 per hour. It is now set to go to £4.69, so our funding rate has gone up 55.3% in 20 years while the minimum wage has risen by 131.56%.”

Emma Gardner, who is quality manager for early years and childcare at Spring by Action for Children, told us:

“I certainly think that funded places in settings that take funded children will reduce dramatically because it is just not sustainable.”

Much of the potential for real investment in this space comes through the Treasury’s so-called tax-free childcare offer and the Department for Work and Pensions’ substantial contribution through universal credit. However, our Committee has heard that neither is working as effectively as it should, and that both need reform to meet the needs of parents today. The Early Years Alliance has suggested to our Committee that the tax-free childcare policy should be stopped and that the theoretical billions set aside for it should be invested in meeting the full costs of the so-called free hours. We have heard from others that the money could be better invested in extending the scope of the subsidised offers from three and four-year-olds down to one and two-year-olds.

Against that, it is worth bearing in mind that the tax-free childcare offer is currently the only part of the system that offers parents any support for children under two or over four, so cutting it off completely would come at the expense of many who use it. I also think that it is worth exploring the true potential of actual tax-free childcare. We could make it much more attractive for parents by allowing childcare costs to be claimed against taxation for the household, as many European countries do, rather than offering a 20% subsidy on cash placed in an account from post-tax income.

There are other ways for the Treasury to help the sector that I believe are worthy of immediate consideration. It could remove business rates from the PVI sector, which provides approximately 80% of childcare in this country. It could remove the unfair burden of VAT, which holds back investment. I know that such moves would come at a cost and that the Chancellor has a hugely difficult challenge in balancing the books after all the challenges of the pandemic, but I plead that he consider the huge benefit of supporting investment in this space and the enormous upsides of better stimulated children and of more parents returning to work.

If such reforms prove a bridge too far, I hope that the Chancellor will look urgently at the massive increases in rates facing many in the sector. The NDNA told our Committee:

“Business rate property revaluation from April 2023 has seen providers report bill increases of 40-50%”.

I received clear evidence of that last week from a passionate early years advocate in my constituency who has been made an MBE for her services to the sector. She is despairing at the proposed increase of 35% in the rates for her outstanding-rated Worcester provision, which is compounded by the fact that the local funding rate has increased by just 1% for two-year-olds and 5% for three and four-year-olds while the national living wage on which many of her staff are working has increased by 9.2%.

I will conclude my speech not by pre-empting the findings of our Committee’s inquiry further than I have done already, but by quoting directly from my constituent. In a recent letter to me, Alice Bennett MBE—the founder of the Worcester Early Years Centre and the recipient of an honour in recognition of her outstanding work in the early years sector—wrote:

“I appeal to you and your Government once again for urgent reform in this nation’s early years sector. We are facing the most challenging time in decades with settings closing and talented staff leaving in droves…We all know that 90% of a child’s brain development happens before the age of 5. The research and evidence for this is utterly convincing.”

She described investing in the sector as

“morally and ethically the right way forward, thereby ensuring that every child can realise their rights and entitlements to develop their full potential and to thrive and enjoy a meaningful existence in this world. Our sector is indeed very dedicated and hardworking but we cannot continue to work for peanuts and be subject to such punitive taxation. Our lifetime legacies of outstanding and irreplaceable nurseries will be forced to close without some form of sensible revision and financial interaction.”

There is a real case for responding to that call for help.

On International Women’s Day, we should celebrate the enormous contribution to this sector of female entrepreneurs—people who have invested a lifetime of learning and labour in supporting children’s development.

I believe that we have a Prime Minister and a Chancellor who recognise the case for education and early intervention, and I know that we have a Children’s Minister who is passionate about the value of childcare and early education. I am hopeful that next time we debate the departmental estimates, they will have enabled the Department of Education to deliver a sustained uplift in investment in early years, and to build on the Government’s overall record in this regard.

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[Dame Andrea Leadsom]

That is lovely, and I pay tribute to the thousands of volunteers who provide breastfeeding support. My hon. Friend highlights perfectly one of the great challenges of becoming a new parent. When we are really struggling, there is a high correlation with mental health issues. When there is not enough support for women who want to breastfeed their babies but find they cannot do so, they suffer from feelings of guilt and feeling that they have failed and they are not good enough, and that lends itself to the problems of postnatal depression that are only too prevalent right across England.

So, to recap: midwifery, health visiting, mental health support, breastfeeding support, safeguarding support and disability support will be universally available in family hubs to help every family to give their baby the best start in life. Not only that, there will be universal-plus support for the most tricky and challenging issues such as the prospect of domestic violence. We know that up to 30% of domestic violence starts in pregnancy because of the partner’s feeling, “This person is going to love the baby more than they love me.” All these challenges that are brought out by pregnancy are quite desperate to be solved. We know that if we can get the hang of giving every baby the best start for life, that will transform our society.

I mentioned that the cost to our economy of late intervention is about £17 billion a year. The Maternal Mental Health Alliance’s study has shown a cost of around £8 billion a year for every new cohort of births as a direct result of the cost of poor maternal mental health in the perinatal period. The all-party parliamentary group on conception to age two—the 1,001 critical days—has demonstrated that school readiness results in a reduction in later problems such as the propensity of children to get into gangs, to have poor mental health and to fail to learn and do well at school. The 1970 cohort study showed, significantly later on, that only 18% of children in the bottom 25% academically at age five get one or more A-levels, compared with 60% of those in the top 25% at age five. What happens to a child in their earliest years follows them throughout their life, and the more we can do in that earliest period, the better, so the Government are totally on the right lines.

[Kit Malthouse]

I applaud my right hon. Friend’s work on the early years and, as she knows, I share her enthusiasm. We are talking today about the estimates for the Department for Education. What role does she think public health has to play in educating parents, particularly about our shared passion for attachment theory? We have been successful over the last few decades in educating parents about not smoking or drinking during pregnancy, about not smoking in the car with their children and about how to give them nutritious food. Much of that has been a huge success, but we have never really had a public health campaign based on the fundamental building block of emotional maturity in children, which comes from strong early attachments. When I was in the DFE, we were considering the idea of a big public health campaign to illustrate the importance of attachment, not just to women but to men as well. An attachment to a father is just as important as an attachment to a mother.

[Dame Andrea Leadsom]

My right hon. Friend is absolutely spot on.

That gives me the chance to mention the London School of Economics report in 2019, which illustrates the cost of insecure attachment. The cost is 50% higher if an infant is not securely attached to their mum than it is for a securely attached child, at around £4,000. If that baby is not securely attached to their dad, the cost can be four times higher than that, which obviously illustrates the importance of dads. My right hon. Friend is absolutely right to raise not only the importance of secure attachment but, very specifically, the importance of dads. The provision of holistic support on fathering is crucial.

My best start for life project is commissioning different bits of training, nationally and free to all early years practitioners, including on reflective parenting, so that everyone working with families, whether as a volunteer or as a professional, understands how reflective parenting can contribute to secure attachment. There is also video interaction guidance that demonstrates to families the good and the not so good, in a way that has been clearly evaluated. A lot of work is being done in the best start for life project to skill up everyone who is volunteering or working in the early years sector and to roll out support for families.

If a family are expecting a baby, they go to their family hub. If they want a book, they go to the library. If they want a bottle of milk, they go to the supermarket. We want family hubs to be a household name where people go if they have a child, and particularly if they have a baby. They should go whether they are rich or not so rich, whether they are young or old, and whether they have other caring responsibilities or not. We know that learning from each other in a supportive environment can be transformative.

I finish on childcare because, although my role as early years healthy development adviser is about nurturing support in the early years, most babies find themselves in a childcare setting when they are still very young—six months to a year old. The 1,001 critical days, the period from conception to the age of two, are a continuum, and it is when the vast majority of the lifelong blocks for emotional and physical health are laid.

Babies may spend a lot of that time in a nursery setting, and it seems to me that there are two issues. The first is quality, and it must be about parental choice. We need good-quality nurseries, but we also need choice for parents. If they want their mum to look after their baby, and if their mum is able, we should be willing to say, “Thank you very much, granny. You will get some sort of payment.” The payment should not be as if they are a trained nanny or nursery worker, but there should be some form of carer’s allowance or attendance allowance for grandparents who go part time to care for their grandchildren.

Secondly, we have already heard that childminding has fallen off a cliff because the regulatory burden, which predates this Conservative Government, has been so great that it has taken a lot of people out of childminding. If I had a six-month-old, I would much rather they were in a home environment than a nursery environment or baby setting.

We need to go with the grain of what works for families, so we need to have choices, with quality nurseries, many more childminders and support for relatives, just as we have for people who look after their elderly husband or wife who has disabilities. People who go part time to look after their granddaughter, grandson, niece or nephew get nothing. It is a straight choice, and it has a significant financial cost. I urge the Minister to consider that.

The final thing is flexibility for parents. Families know best what works for them, and people tend not to have just one child. Child No. 1 can be very difficult, but when a family is faced with paying 50 quid a day for a tip-top nursery because they want to go back to work nine-to-five—they also need to get to work and get back to pick up their child—the nursery costs are huge. For an awful lot of women, having a second child means it simply is not worth going back to work.

We should allow parents to have their own childcare budget that they decide how to use. I wanted my first child to come out of childcare when my second child was born because I wanted them to be together. If a mother is home on maternity leave, why not have the two children together? It should be a choice for families, but if the first child is three years old, families do not want to lose their free hours of childcare, even if it would suit them to have both children at home. I urge the Government to consider giving parents that choice. Childcare is difficult enough without there being hurdles that make it unaffordable and inflexible for far too many families.

I am delighted with the Government’s work on rolling out the family hubs and best start for life, but childcare is part of it and we need to give families more choice.

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[David Simmonds]

The hon. Member shakes her head; I appreciate that the Labour party and the previous Labour Government were enormously attached to that, but it is right that it has been subject to scrutiny. For something intended to be a flagship, it was clear that the Sure Start programme did not reach the parts that other programmes could not reach, which was the crucial and core purpose for which it was set up. That is backed up by research from the United States.

The right hon. Member for South Northamptonshire (Dame Andrea Leadsom) referred to the Early Intervention Foundation. I urge the Government to make the best possible use of the now merged What Works centres, whose chief executive, Dr Jo Casebourne, was previously chief executive of the Early Intervention Foundation. The use of randomised controlled trials was strongly advocated at the outset of Sure Start, and was resisted by the then Government. There was a lot of debate about why that was, and certainly an active suspicion among researchers that the Government did not want any of that research to come back and point out that some interventions were not very effective and not a good use of taxpayer money.

An emerging substantial evidence base demonstrates that although some of the things that we spent money on in Sure Start did not achieve any useful purpose for the children who were supposed to be the beneficiaries, other programmes were effective. Commissioners, whether in the Department or in the local authority, need that information so that, given a choice to spend a given amount of taxpayer money, they can spend it on what will make the biggest possible difference in the life of a child. Evidence week is coming up in Parliament soon, and I hope that the Department and Ministers will have the opportunity to celebrate the use of evidence in the distribution of the funding that we are debating.

Let me give a good example. Several hon. Members have mentioned ratios, which Governments in the past have addressed. There is an enormous amount of guidance for local authorities and providers about how things are to be done, and it is a dull but worthwhile exercise to read the Department’s guidance on calculating ratios. It makes it very clear that, depending on how we choose to calculate them, we can produce very different figures suggesting very different things about the ratio of children to staff at a given site.

A setting can arrive at a number by dividing the total number of staff, or the full-time equivalent, by the number of children on the roll. Ofsted would probably encourage it to think instead about how many appropriately qualified adults per child are in the room—a different figure. Both approaches are fine within the DFE guidance, however, so those who believe that changing the ratios can completely transform the early years landscape and resource spread are perhaps barking up the wrong tree. It may well be that adjusting the guidance would help to address the issue.

[Kit Malthouse]

To a certain extent I think my hon. Friend is right about ratios, but does he accept that they inject into the system an element of inflexibility and certainly an element of nervousness? As I understand it, most providers under-pitch on ratios for fear of accidentally being caught on the far side through illness, absence or whatever. The delineated hard lines may be subject to interpretation, but they nevertheless produce a rigidity that is not helpful for providers.

[David Simmonds]

My right hon. Friend is right to highlight that there will always be a degree of risk aversion. Frankly, as someone who entrusts his young children into the care of a nursery, I am quite keen for it to be reasonably risk-averse in its calculations. However, my right hon. Friend’s point demonstrates that in debates such as these we need to scrutinise not only the estimates setting out the financial headlines, but the real-world as well as the theoretical impact of the underlying calculations. This is a debate not just about the headlines, such as teaching unions arguing for more resources in one respect while the Government argue for different resources, but about the way in which we count these things, which can have an enormous impact on whether we achieve the policies that we set out.

I commend the Government for the estimates. Estimates debates are always interesting and worth while, because they teach us a great deal about the mechanics of what is going on. The UK has a relatively high spend on education and is a good payer of teachers in comparison with most other European countries—I say that as a former chair of the European Federation of Education Employers as well as the teachers’ employment body for the UK. This will always be a subject of ongoing debate, but it certainly seems to me that in agreeing today’s estimates we are making a clear statement of our commitment to provide strong baseline funding for our education system, particularly the childcare and early years element.