Childcare

Steve Brine Excerpts
Monday 13th September 2021

(1 month, 1 week ago)

Westminster Hall

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Department for Education
Stella Creasy Portrait Stella Creasy (Walthamstow) (Lab/Co-op)
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It is an absolute pleasure to serve under your chairmanship, Sir Roger, and to have this debate. I am grateful that you gave me an opportunity to put my jacket on because, like any parent of an under-two-year-old, I have snot and Weetabix on the back of my clothes. I have accepted that having two children means that I will be permanently sticky for the next 18 years. Because I have two children under the age of two in London, I also accept that I will probably never be able to go out because the cost of childcare is so prohibitive.

We have one of the most expensive systems in the world, but high cost does not necessarily mean high impact. The TUC found that, for parents with a one-year-old child, the cost of their child’s nursery provision has grown four times faster than their wages, and more than seven times faster in London. In communities such as mine, which has the 10th-highest level of child poverty, families are already choosing between eating and keeping a roof above their heads. Affordable childcare, like affordable housing, is an illusion. I thank Pregnant Then Screwed, the Early Years Alliance, the Women’s Budget Group, the Fawcett Society, the National Day Nurseries Association and the all-party parliamentary group on childcare and early education for their refusal to let this be the new normal. Childcare is something that everybody needed during the pandemic and nobody got.

As my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) pointed out, during the pandemic the Government found time to make the case for infrastructure investment. They found £27 billion for roads and for 50 million potholes, money for new railways and stations, and even £5 billion for broadband. What did our children get? Well, the Chancellor did say that mums everywhere were owed a debt of thanks for juggling childcare and work. That pat on the back shone a light on how this Government think about working parents. This is an infrastructure issue, and as a result of failing to see it that way, we are losing tax revenue, losing women from our workforce and hampering equality in our society.

We have already talked about the lack of childcare provision prior to the pandemic—30% of local authorities accept that they did not have enough places, and only one in five said they had enough places for children with special educational needs—but it has become a lot worse during the pandemic. The consequences for families are clear: 75% of children in this country living in poverty are in working households, and childcare accounts for 56% of the overall costs of children for working couples.

Nothing about this system makes any sense. I am a parent of two children under two, but why on earth do we think that when children hit two or three, they are special? What am I supposed to do with these children until then, when it comes to childcare? Frankly, the people who will leave the workforce because they cannot afford childcare will already have done so by the time a child is two, and those of us who can afford childcare will be able to afford it after the age of two.

The Minister will no doubt point to the universal credit system, but it does not make sense in the real world either, because it expects parents to pay for childcare up front and then recoup the cost, as if parents on universal credit have spare cash to begin with. The Minister might say that the flexible support system is there, but only a few have used it on childcare. Anyone who has tried to get childcare in London knows that universal credit, which has been frozen since 2016, means that for most parents it is not a runner.

Failing to invest in childcare is baking inequality into our system for parents and children alike. We know that the vast majority of people using the 30 hours of funded childcare are from the top income earners. We know that the parents of 240,000 children aged two to four could potentially access childcare, but do not because of the cost of it.

We know that this issue is hitting gender inequality, too. My hon. Friend the Member for Newcastle upon Tyne North is right to point out that the burden of childcare too often falls on women. Only 2% of new fathers take any parental leave: that is because we ask them to pay for it, rather than recognise it as the investment in the child’s development and in the family that it represents. Almost 870,000 stay-at-home mums who want to work cannot do so because of the cost and availability of childcare, and those problems have got a lot worse during the pandemic. Some 46% of mothers who have been made redundant said that a lack of childcare was a factor in their selection for redundancy. When furloughing ends, many more will not be able to go back to work because the childcare will still not be available: the loss of places during the pandemic means that many more will be out of work. That means that we will not get the tax revenue from those mums’ work, and it means that their families and their careers will suffer.

The crazy thing about this is that investment in universal childcare from the age of six months pays for itself. When we provide that, not only do we get an income from the sector—and, by God, we should be paying these people a lot more to look after our children—but we get the income from the higher number of women who can be in work. There is an army of mums out there who are mad as hell that they are being ignored and expected to take on childcare at short notice, and I tell the Minister that mums can multitask too, and they can vote. We have to get this right, because we owe it to every child and every mum in this country to see them right.

Steve Brine Portrait Steve Brine (Winchester) (Con)
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I congratulate the hon. Member for Walthamstow (Stella Creasy), who is a friend, on the new arrival. The importance of this issue in the eyes of our constituents, mine included, is reflected in the fact that almost 113,000 people signed this e-petition, which—as has already been set out—calls for

“an independent review of childcare funding and affordability”.

The public, I think, feel we could do more to create a sustainable future for the early years sector, which I represent here today as chair of the all-party parliamentary group on childcare and early education, which has been mentioned. We in that group have spoken for some time about what I would describe as a market failure in this sector, and the need for a meaningful review of it, so it is good that we are having this debate.

Prior to the summer, I had the pleasure of speaking in another debate on this issue, in Westminster Hall in its other incarnation—these debates come around often—and in the months since, things have moved on. The Chancellor has now announced his comprehensive spending review alongside his Budget on 27 October, and it was very useful to speak to him last week—I was in that meeting too, along with my right hon. Friend the Member for Chipping Barnet (Theresa Villiers)—about many of the issues we are debating this afternoon. I must stress from the outset, as I did to the Chancellor, that this is not all about money. For me, it is about getting back to brass tacks to make our early years funding system work for the children of this country, and for the families who rely on it and the economy that relies on those families. It is about ensuring that our hard-working early years educators—I declare my interest: I am married to one—are rewarded. Most importantly, it is about putting our early years sector on a sustainable footing so that this debate will not keep coming around again and again.

I am here as chair of the all-party parliamentary group, but I am also a Government MP, and I am very proud of the landmark commitment that we as a party made through the 30-hours entitlement. However, I have to say that through my work chairing the group, it has become clear to me that systemic reforms are needed to make this flagship policy work better. Data from the National Day Nurseries Association, which is one of the sponsors of our group, show that in 2019-20, three quarters of councils underspent their early years funding by £62 million. Meanwhile, there is a funding shortfall of almost £3,000 per child per year for every 30-hours place. My hope is that Government will agree to use the forthcoming spending review to fund an early years catch-up premium and address this shortfall, including facing down the local authorities on that underspend. Merely by overhauling the system and tackling the existing underspend, we could properly fund many of those 30-hours places for children right across the country.

That is just one example of how reviewing the funding system would ensure that the existing funding follows the child and is best used. For me, the two issues are intrinsically linked: we cannot fund our early years sector without holding a fundamental review of the funding system, and we cannot simply wait for a review of that system to report without some sort of bridging measures and the long-term certainty that my right hon. Friend the Member for Chipping Barnet spoke about. Between April 2020 and March 2021, there was a 35% increase in nursery closures, just at the time when parents who are key workers needed them most. That is a grave concern for us. The nurseries that are struggling and closing tend to have a higher proportion of Government-funded children. Therefore, the poorer families suffer more from the shortfall between the funding and delivery costs. That causes the lag that is causing the closures.

The future of the sector is in peril, and with it the benefits that it brings to children, their families and the economy. It is not just about the bottom line for providers, but rather the future and development of our children, who are then ready to go on to reception and their primary and secondary education.

George Howarth Portrait Sir George Howarth (Knowsley) (Lab)
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The hon. Gentleman makes a powerful case, as have others. Does he agree that grandparents often have to step in to the breach and provide the necessary childcare? While that is very welcome and they do it willingly, it results in an uneven pattern of child development.

Steve Brine Portrait Steve Brine
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The right hon. Gentleman’s point goes to the heart of the issue. I talked about early years educators; these are not well-meaning amateurs at the end of their career who are just providing plasticine. They are educators and they are preparing children for the world of learning when they go into their primary and secondary education. It is a very good point and it is well made.

Nursery settings have remained open and ready to receive children to help their families get back to work. At the same time, their staffing costs have risen on average by 8.6% through the new national living wage and pension contributions. With the reintroduction of business rates looming, the average nursery will face a bill of about £12,500 for those alone. Surely it would be better to see this money going into the pockets of our early years educators and directly invested in the future of children across the UK. That would be a fitting way to recognise the unsung contribution of early years educators over the last year and to help develop our country’s most valuable asset—the next generation.

Wera Hobhouse Portrait Wera Hobhouse (Bath) (LD)
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Early years staff have worked incredibly hard during the pandemic, sometimes putting their own health at risk to ensure our children are cared for. I thank each and every one of them. However, one of our early years providers in Bath said, “I feel the Government do not value us and do not see our professionalism and dedication to our role.” Too many childcare workers have felt this way throughout the Government’s response to the pandemic. Guidance to them has been ambiguous, and provision of PPE and testing has come far too slow. Recovery funding has focused primarily on school-aged learners.

I secured a debate on early years funding before the summer recess. My message to the Minister is the same now as it was some weeks ago—acknowledge the value of the early years sector and pay what it costs to deliver it. Funding has been a widespread concern long before the pandemic. Research from YMCA suggests that up to 80% of settings cannot deliver childcare at the funding rate provided by their local authority. I take the point that there is underspending in some local authorities, and we need to get to the bottom of that, but the overall funding gap is still too big. Most providers realistically need more than £6 an hour per child just to break even, let alone reinvest in their business. However, the funding rates do not reflect this. In Bath, in north east Somerset, our local council receives £5.59 an hour for two-year-olds, and just £4.48 an hour for children aged three and above. It means providers have to choose between operating at a loss and subsidising the cost of delivery through fee-paying families.

Of the expenses, 70% are staffing costs. If funding continues to increase at a much slower rate than the national living wage, it will become more and more difficult to pay staff properly. In a country where parents pay the second-highest childcare costs in the world, one in 10 childcare workers are officially living in poverty. Affordable childcare is essential to our economic recovery from covid-19, but with childcare costs adding up to about 30% of the average wage, many parents—usually women—will be forced to make difficult decisions about remaining in or returning to work. Should one of the legacies of covid-19 the roll-back of decades of progress on equality for women in the workplace?

This Saturday is International Equal Pay Day. What better time could there be for the Government to commit to a total rethink of childcare funding? And I add my full support to calls for a meaningful review of early years funding, which must include a multi-year funding settlement, simplifying the funding system and making sure that funding follows the child. All allocations of early years funding must consider children with special educational needs and disabilities, across all settings.

Childcare is an investment in our future. It is time that it was treated as such.