Nurseries and Early Years Settings

Rachel Hopkins Excerpts

Thursday 3rd December 2020 Westminster Hall

[Rachel Hopkins (Luton South) (Lab)]

It is a pleasure to serve under your chairship, Mr Hollobone. I start by thanking the hard-working early years staff in Luton and across the country for the dedicated support that they have provided to children and their families throughout the pandemic.

In Luton, across my constituency and that of my hon. Friend the Member for Luton North (Sarah Owen), there are six maintained nursery schools, which work together to provide comprehensive nursery education and care to our local community. Gill Blowers Nursery School, Grasmere Nursery School and Pastures Way Nursery in Luton North, as well as Chapel Street Nursery School, Rothesay Nursery School and Hart Hill Nursery School in Luton South, have stepped up to the challenges posed over the last year, despite the overarching financial uncertainty in the early years sector.

When I visited Hart Hill maintained nursery school and met the fantastic headteacher, Mrs Thompson, and her staff team, I saw at first hand the brilliant work that they do, and heard about how they have remained open throughout the pandemic to continue providing education and care to children from some of the most deprived areas of Luton. They have also supplied key resources and food to families.

Maintained nursery schools offer a bespoke package of education and care by using skilled staff and research-focused routines, environments and ethos, and by working in conjunction with external health and SEND professionals. A bespoke approach enables them to focus on children’s needs and wellbeing by understanding their responses and behaviour and then adapting provision to provide a safe, responsive space. The maintained nurseries in Luton have resourced provision for children who have significant special educational needs and severe medical or health needs. Last year, they successfully completed 53 education, health and care plans for children who have gone on to transition into specialised primary schools. The maintained nursery schools have ensured that between them they have resources to support 96 children with severe or complex needs, many of whom have been transferred from private early years settings. Their dedication and commitment to Luton ensures that our most vulnerable children have the care that they need and deserve.

Despite all the essential support that maintained nurseries provide our communities, the Government chose not to introduce a long-term funding plan in the recent spending review, about which we have already heard a lot. I am aware that there was the one-year settlement in the summer, but short-term funding plugs will not safeguard the future of maintained nurseries. Yearly funding does not provide sufficient certainty for maintained nurseries to plan ahead by employing staff and allocating resources, or for parents, who worry that the services on which they rely may not exist in a year’s time.

The Department for Education’s own statistics show that the percentage of maintained nursery schools in deficit has risen from 3.5% in 2009-10 to 17.7% in 2018-19. Unlike schools, many maintained nurseries have not received funding to cover additional covid costs, and are ineligible for the covid catch-up fund. Luton Borough Council consulted with DFE representatives on whether increased costs would be reimbursed, and the DFE indicated that they would be. However, all applications for costs reimbursement by maintained nurseries in Luton have been rejected, as they have been deemed ineligible. Will the Minister meet me and my hon. Friend the Member for Luton North to further discuss how Luton’s maintained nurseries can get crucial additional funding to cover those costs?

If maintained nurseries close, the cost of looking after vulnerable children will fall on other services, which have suffered the economic impact of austerity and the pandemic. I urge the Government to introduce a long-term funding settlement as soon as possible.

[Mr Philip Hollobone (in the Chair)]

No Westminster Hall debate would be complete without Jim Shannon.

--- Later in debate ---

[Rachel Hopkins]

On that point about nursery schools not receiving additional funding for covid security, for the very reason that little ones do not know how to socially distance, Park Hill Nursery School has had to divide up its classrooms. It has created a new classroom in its library area to maintain smaller groups in order to deal with that, which puts added pressure on staffing.

[Tulip Siddiq]

I absolutely agree with my hon. Friend, and I have seen exactly what she is describing at first hand in my son’s nursery.

I am also worried that nurseries with rateable values of over £15,000 were not allowed to access the larger covid grants for retail hospitality or leisure businesses. I hope the Minister will look into that. The Chancellor agreed to give nurseries business rates relief only after intense lobbying from all sides, but, sadly, that support is due to come to an end in April next year, and maintained nursery schools, which have been mentioned repeatedly in this debate, are not able to access it. Many part-time or recently started childminders have been excluded from help through the self-employment income support scheme, and the early years providers did not qualify for the £1 billion covid catch-up funding. Last week, they were excluded from the covid workforce fund to help with the cost of staff absences, despite huge staff pressures.

In essence, throughout this crisis, early years providers have been asked to take on the responsibilities of schools but the liabilities of businesses, and with nowhere near the same level of financial support that has been given to other businesses. Of course I welcome the £44 million increase in new childcare funding in the spending review, but I do not feel it is enough to plug the gap, which stood at £662 million last year. It will only come in April, by which time many providers will certainly have closed. A chain of three nurseries in Essex I spoke to recently spent £6.10 per hour providing a Government-funded childcare place, yet only got £4.32 per hour from the Government to do so, so the 6p per hour increase to funding in the spending review is a drop in the ocean.

I want to work constructively with the Government because the early years sector is important. I also give credit where it is due. One positive step was the Government’s commitment to funding providers at pre-covid occupancy levels, both when they were forced to closed to most children from March to June, and in the autumn term when it was clear that childcare demand would be suppressed by fear of covid, furlough, job losses and working from home. That prediction was correct: occupancy in early years settings is currently just above 60% of normal term-time levels. However, although there is no reason to think demand will not continue to be low for some time, the Government are planning to go back to funding providers based on current occupancy from January. I realise it may sound like a technical point, but that will be devastating for over a quarter of providers, according to a recent survey by the Early Years Alliance.

One could argue that that made sense when the Chancellor was planning to withdraw the furlough scheme and get everyone back to work from October, but it does not make sense to extend the furlough and impose lockdown and severe restrictions while pretending that everything is back to normal for childcare, just because the Government do not want to foot the bill. I ask the Minster to take heed of this. It is hard to estimate the overall impact on the sector, but to take the example of the small nursery chain in Essex I mentioned, the owner estimates that the chain would have lost £12,000 of income this autumn term if funding was based on the current, reduced occupancy, and expects the shortfall to be much bigger in the spring term when funding is set to be calculated as the Government intend.

Mass closure of childcare settings would be devastating for over 300,00 people working in early years, the majority of them women, which is a point already made by hon. Members. Childcare workers are paid badly anyway—I am sure people are aware of that—with one in eight receiving less than £5 an hour. We should be working to tackle low pay and improve career progression in the sector. We have duty to make sure we do not bring about the demise of these jobs by slashing funding.

To remind everyone, this debate is about the future of nurseries and early years settings. The reality is that without better support, and a new approach, thousands of them may not have a future at all. Most hon. Members have made that point today. Survey after survey shows that the early years sector is on the brink of collapse. One in six providers expect to close by Christmas, rising to one in four in the most deprived areas. Recent research from the Department for Education shows around half of all nurseries, pre-schools and childminders were unlikely to be sustainable for more than a year. These are shocking statistics, and I hope the Minister will take account of this. There has been a net loss of 14,000 childcare providers in the last five years as a result of the chronic underfunding of early years entitlements. We could lose at least that many again within this year if fears are not allayed, and action is not taken immediately. I ask the Minister to consider how devastating this would be for working families who rely on childcare, and the young children whose life chances are shaped by the power of early education—that point has been made over and over again—not to mention the impact on our economy and recovery if working parents are forced to stay at home. The brilliant early years workforce will suffer large-scale redundancies.