Early Years Settings: Covid-19

Steve Brine Excerpts

Tuesday 12th January 2021 Westminster Hall

[Steve Brine (Winchester) (Con)]

I congratulate the hon. Member for Putney (Fleur Anderson) on securing and introducing this debate. As chair of the all-party group on childcare and early education, I want to make a brief contribution. I hope the hon. Lady will join the group. We look forward to having her as speaker at our next meeting. She will be very welcome.

On occupancy and demand for places, demand is, on average, 21% lower than it was in 2019. The Government had been basing early entitlement funding on pre-covid attendance rates, but it was announced just before Christmas that this would stop in the spring term. New guidance has not yet been issued on whether councils should continue to fund places for children not currently attending. That said, I was pleased to learn that Hampshire, my own county, said last week that it will guarantee funding until half term—which is good but obviously very short-term—whether or not parents decide to keep their children at home due to the pandemic.

More generally, I want to place on record a survey carried out in November by the excellent Early Years Alliance, which found that 56% of providers said that basing fees on current occupancy would have a negative or very negative impact on them. Of those, 45% said they did not think they would be able to remain viable for more than six months as things stand. This means that the decision to remove this support could result in some big closures by late spring. It is that urgent, remembering, as we do, that early years settings are open and allowing parents to go to work.

Turning to testing and vaccinations, it is hugely welcome, as the hon. Lady said, that early years staff will be offered asymptomatic testing. When she closes the debate, will the Minister provide some detail on when and how that will be accessible, what support and training practitioners will be offered with administering the tests; and, of course, how associated costs will be covered?

Some practitioners have been offered vaccinations by their local hospital. Some, obviously, will come within the first four groups, but that is not the case for all. Early years practitioners are bravely continuing to come into work, despite the current prevalence of the virus in society. In my opinion, they, along with other educators and critical workers, should be offered the vaccine as a priority in phase 2 of the roll-out. I made that point in this very Chamber yesterday, so I will not labour it again.

Thirdly, on self-isolation and covid in early years settings, we know it is a constant juggle for settings to remain open due to the number of staff self-isolating. Nurseries have had to form closed bubbles of specific staff and children, meaning that if there is a positive test in one bubble, the other children need to isolate. That obviously has an impact on parents, particularly critical workers, so I would argue that offering routine testing for the early education sector and prioritising it for the vaccine roll-out is key.

Furthermore, having a lot of staff self-isolating and testing positive also means that practitioners are struggling to maintain the important staff ratios. I have heard many nursery owners say that they are not clear whether, if they had to close due to a lack of available staff, they would lose their entitlement funding. They will typically also lose parent fees in this situation, which means that paying staff and keeping up with other costs, such as rent and utilities, becomes a real challenge.

It is important to note that for childminders, who are so often overlooked in this whole early years debate—I declare my interest, because I am married to one—a positive test will almost always mean the temporary closure of the entire business, which will have an impact on all those who rely on that childminder.

It would remiss of me not to mention the pre-existing funding challenges, which have already been touched on. They never went away and were, of course, the subject of the debate I led in this place last month. The early education sector was, I continue to argue, experiencing market failure long before the pandemic. Funding levels have not covered the cost of provision for many years. Ceeda, an excellent independent research company, has shown that even if occupancy levels were exactly the same now as they were in spring 2019, some 77% of childcare providers would still be coping with a shortfall of £2 per hour for every funded two-year-old, and 90p per hour for every funded three and four-year-old. That drag becomes a problem, and it is now a real problem.

I thank the Minister for the 1.2% increase in funding rates due to come into effect in April. However, in practice and at best, it equates to just 6p or 8p an hour per child for childcare providers across England—at a time when we should remember that the national living wage is due to increase by 2.2.%.

In closing, I still believe we need to commission an independent, meaningful review of early years policy and funding, to ensure that the gap between the costs of delivering early education and the rate paid per hour per child to providers is closed and eventually eliminated. If we do not do that, we are going to lose a lot of provision, which would serve nobody and would be the opposite of levelling up.

Finally, I want to say how sad it is that sittings in Westminster Hall will not continue after today if the motion tonight goes ahead. As a former Minister who has spent many hours sitting in this Chamber and responding to debates, I believe that good scrutiny leads to good policy and good government, and without it, we are all worse off.

Nurseries and Early Years Settings

Steve Brine Excerpts

Thursday 3rd December 2020 Westminster Hall

[Steve Brine (Winchester) (Con)]

I beg to move,

That this House has considered the future of nurseries and early years settings.

I thank the Backbench Business Committee for granting this debate, which is a coming together of the all-party parliamentary group for childcare and early education, which I chair and which fights for the private, voluntary and independent sector—PVI—and the APPG on nursery schools, nursery and reception classes, which does good work campaigning for the maintained nursery sector. We will hear shortly from one of its vice-chairs, my right hon. Friend the Member for Chipping Barnet (Theresa Villiers). The hon. Member for Birmingham, Erdington (Jack Dromey) cannot take part today but is also very much involved in that group and was a co-sponsor of the debate.

The two parts of the sector are distinct, but they share the same grave concern about what the future holds. As a constituency MP, I am fortunate to represent both. There is a mature but, it must be said, struggling PVI sector with providers such as Kings Worthy, St Paul’s, Colden Common, and Compton and Shawford to name a few. There are many others. I thank them all for making me properly aware of the sector and its challenges in the first place, alongside my brilliant wife, who is a qualified at level 3 practitioner, so I hear it very clearly. I also have Lanterns, a maintained nursery school, in my patch; I thank its headteacher, Lynsay Falkingham, for her persistent and focused contact with me.

I will start with some positives. We all welcome the fact that the Government committed to an increase in early years education investment in last week’s spending review. That is another example of the Government recognising the crucial role that early education has in improving future attainment and economic success for the wider economy. As one of my constituency providers put it in an email to me this morning:

“I hope that in your debate, you are able to put across to the House the importance of sound Early Years Care and Education. The future of our country, our leaders, our doctors, engineers, teachers, key workers…rests in the hands of Early Years teachers and practitioners.”

I shall do my best.

I think I speak for many when I say that our childcare providers have really been the fourth emergency service during the pandemic, caring for the carers and helping the helpers. That has been so important to keep the show on the road, and it shows how important it is that we support the sector going forward. As the National Day Nurseries Association says in its excellent recent report:

“A plan for jobs needs a plan for childcare.”

To stick with the good news, it is very good that the Government are implementing our manifesto promise to provide 30 hours of funded childcare each week for parents of three and four-year-olds, which should increase the availability of affordable early education provision. Just because that is the right policy, however, it is not without unintended consequence.

I really appreciate that the Chancellor recently met me and representatives from the APPG for childcare and early education in Downing Street to discuss making childcare more accessible and affordable across the PVI sector. We did that because we cannot duck the fact that there remains a serious underfunding issue that has, unfortunately, been exacerbated by the covid-19 pandemic.

I have previously described to the House that the sector is experiencing a form of market failure—I stand by that—but that could also be a social failure if we get this wrong. In reality, the financial implications have often meant closures in the most disadvantaged areas, as providers have been forced to cross-subsidise their income—often unsuccessfully—with parental fees. The sector has struggled to make ends meet for years, and many providers feel that they have reach the end of the road as we reach the end of 2020.

By September last year—well before the pandemic hit—there had been a 153% increase in nursery closures since the 30 hours’ free childcare policy was introduced. In essence, we have delivered one part of sustainability for the future, but we now need to finish the job by increasing funding for settings to a sustainable level. Many of the providers that I speak to discuss market failure with me. It is little wonder when 25% of providers across the country could face permanent closure within the year. Recent research found that 72% of maintained nursery schools expect to end the year in deficit, raising the risk of further closures in the maintained sector, too.

The whole sector faces a real challenge, not only because of the effects of the pandemic but, more importantly, because of an unsustainable position at the heart of the sector’s funding, which we have to rectify. The issue affects every Member of the House—it is good to see such turnout on a cold and wet Thursday afternoon—because the impact across our country will be stark if we get it wrong. I would argue that we need a complete overhaul of the current system to ensure long-term sustainability in the sector and value for taxpayers’ money.

Prior to covid, the funding gap in the early years sector was estimated to be £824 million. At that point, there was already a 37% funding deficit between the hourly costs of delivering a funded childcare place for a two-year-old and the rate paid to providers, and a 20% funding deficit for places for three and four-year-olds. That is not a sustainable long-term position. Those figures are based on pre-covid occupancy rates. Settings are still struggling despite now being allowed to remain open to care for and educate our children. The funding gap has had a cumulative effect as the years have gone by. I passionately believe that addressing that gap would go some way towards reversing that market failure and the pattern of closures that we see all too often.

In short, I would like a funding mechanism to increase funding rates in line with the rising costs of delivering childcare. Statutory wage rises, increases in pension contributions and inflation rates all erode the balance that providers must maintain to remain financially viable. The £66 million increase in early years spending in this financial year, which was announced at the 2019 spending round, was obviously a welcome cash injection. Sadly, many settings saw it as a real-terms funding cut once inflation rates and the minimum wage rise in April had been taken into account, and I have heard that over and over again. Financial constraints also mean that nursery owners are largely unable to offer their staff long-term career progression and incentives for upskilling and gaining qualifications. We heard very powerfully about this at a recent meeting of our APPG.

Of course, covid has had a particularly savage impact on the sector, with increased costs and decreased revenues for many settings. There has been a decline in occupancy rates and child places, as well as increased costs to make the settings that are open safe through the personal protective equipment and additional cleaning that is obviously necessary. With just a quarter of providers saying that they expect to make a profit between now and March 2021, we have to take action to protect them for the future.

Last week’s spending review included a pledge from the Chancellor of £44 million of additional spending on early education, on top of the money confirmed in 2019. This is good news, of course: those vital funds will increase the hourly rate paid to providers for the Government’s free hours offer, and are also a step towards sustainability for the sector. However, the underlying problems with structural funding and distribution by local authorities remain acute, and will remain so unless they are properly addressed. An independent, meaningful review into the current system for childcare and early years funding will give us the chance to address the underlying, systemic problems with the early years national funding formula, to ensure some long-term sustainability.

Four years after the introduction of the early years national funding formula I mentioned, the maintained nursery sector is still waiting for stop-gap funding to be replaced with a long-term formula that addresses the historical discrepancies and funds all nursery schools viably. The announcement of £60 million in supplementary funding for maintained nursery schools in 2021-22 is hugely welcome, but there are some crucial next steps. First, funding should become a permanent part of the early years funding settlement, not a year-by-year add-on. Being in such uncertain terrain is adding huge stress to the people who run these settings. Secondly, this funding should be distributed on an equitable basis across the country, not on the basis of historical precedent, as is presently the case.

It is crucial that future funding arrangements for maintained nursery schools adequately provide for them to meet their statutory obligations as schools, which they are: for example, funding for additional costs such as the well-deserved teachers’ pay award. While that extra £60 million in funding is welcome, it is clear that here, too, a long-term sustainable financial solution must be found for the sector as a whole.

For all providers, the early years national funding formula can be—if we are being polite—something of a minefield. Requirements and entitlement distributions differ greatly across different national authorities, which creates a complex funding context for providers operating in one region, let alone several. It is complex, bureaucratic and incoherent, and we are often told that it makes a tough job even harder. The current system must work better for settings and parents, but also for taxpayers—our constituents.

Cash for funded entitlement places relies on local authorities estimating demand, and then on them making corrections to this rough draft partway through the financial and academic years. This has created an unhelpful culture of large contingency funds and underspends of taxpayers’ money that is neither providing the childcare provision it is meant to, nor supporting the settings it is meant for. Millions of pounds intended to deliver funded childcare places is often either redirected into other parts of local authority education budgets, or held in reserve to cover the inconsistencies that emerge throughout the year as they try to flatten things out.

A freedom of information request to all English local authorities found that three quarters of councils had underspent their early years allocation, which amounts to more than £65 million failing to reach providers for eligible children. It showed that contingency budgets of up to £32 million were being held to allow for funding corrections this year. This is taxpayers’ money, and we have to do better. Urgent reform to safeguard the future of nurseries and early years settings across the PVI and maintained sectors is desperately needed, for all the reasons I have set out. That will ensure better value for money for the taxpayer, maintain this vital early education—particularly for disadvantaged children, who need it most—and protect the jobs of 360,000 people who work in the sector, the vast majority of whom are women, while also enhancing their career development prospects.

For me, this is an issue of social justice. I am very pleased that Ministers are working with us to do all that they can. I know the Minister here today will take on board the concerns I have highlighted. We have shown we can work together to protect health throughout the pandemic. It is time we worked together to protect the long-term future of our education system. That needs to start with early education, so let us get it right from the very start.

[Rushanara Ali (in the Chair)]

May I ask Members to keep their remarks to four minutes so that we do not need a formal time limit?

--- Later in debate ---

[Steve Brine]

In summary, we have heard some committed speeches about the maintained sector and the PVI sector. The fragile sector comment was very well made by the right hon. Member for East Ham (Stephen Timms). My neighbour, my right hon. Friend the Member for Romsey and Southampton North (Caroline Nokes), talked about the high-quality provision in her constituency and across Hampshire. Across the whole country, the Minister reminded us of the Ofsted figures, and that is all true.

My right hon. Friend the Member for Chipping Barnet (Theresa Villiers) called for the long-term settlement, echoing what I had said in my opening remarks. I was struck by what my other neighbour, my right hon. Friend the Member for East Hampshire (Damian Hinds) and former Secretary of State, said about social infrastructure and the need for a people plan. That is absolutely spot on. I was struck by the comment made by my hon. Friend the Member for Newbury (Laura Farris), who said that we are on the brink of a bloodbath in terms of female employment. My hon. Friend the Member for Wycombe (Mr Baker) was absolutely right to say that early years is about the building blocks of a successful society and economy.

We have heard speeches that cover every aspect of the sector, from the 389 maintained nurseries to the 20,000 or so in the PVI sector, and then there are childminders and our children’s centres. My message is that we need to see the sector as a whole. All providers across the sector look after SEND children. All understand that a plan for jobs needs a plan for childcare. The consistent theme has been that we have to close the gap between what it costs to provide the childcare and what providers receive to provide it. Unless we close that gap, we will continue to have this discussion.

Draft Higher Education (Fee Limits and Student Support) (England) (Coronavirus) (revocation) regulations 2020

Steve Brine Excerpts

Tuesday 20th October 2020 General Committees

[Michelle Donelan]

I was going to come on to that, but as the hon. Lady is eager, I will address those questions now.

Drop-out rates are a matter of concern to me and the Department in any year. We want to ensure that students can access an education, continue it and complete it, so that they have a qualification that will unlock their future. I regularly talk to the sector about that in my weekly discussions with the higher education taskforce. I know that it is monitoring numbers. It is imperative that support is available to students on matters ranging from food, wellbeing and mental health, especially for those who are self-isolating, and that that is prioritised. Last week I wrote a letter to each university and provider on that very subject. I will work hand in hand with them to ensure that that support and guidance is given, and that it is communicated to students, so that they can continue on their educational journey.

On finances, back in May we announced our stabilisation package that assisted with cash flow, and brought forward some money, include QR funding to the tune of £100 million. That was in conjunction with the work of the Chancellor of Exchequer, who has provided according to my best estimate £700 million for loans and grants. We regularly monitor the financial health of all institutions, including those who were affected by the reversal to centre assessment grades in the summer, and that is done in conjunction with the Office for Students. As the hon. Lady will be aware, we have also introduced a restructuring regime that acts as a safety net for any institution that, having accessed all the other support available, is still in need of help. It is important to stress that, at this moment in time, no institution has self-referred to the restructuring regime, but it remains an avenue of opportunity.

As for preventing aggressive recruitment practices in the forthcoming year, many of my predecessors have written to institutions against the use of unconditional offers. I continue to reiterate that message to the sector, and that issue will be considered in our response to Augar. We will keep everything on the table next year as we deal with the pandemic and any fall-out that it may have on SNCs and such like.

[Steve Brine (Winchester) (Con)]

The Minister is a very good Minister and engages strongly with the sector, including the University of Winchester, which I am fortunate to represent. In terms of future student numbers, has she had any conversations about incentivising European Union students to come here? For a lot of universities and institutions, including my own, those students are a key part of the business model.

[Michelle Donelan]

Indeed. It is important to incentivise all international students. When we read the media reports a few months ago, it looked as though the numbers would drop off a cliff, but that has not happened. That is testimony to our fantastic institutions. Of course it is still early days in terms of the exact number of international students studying here, and some are currently studying remotely. We have a big draw for students inside and outside of the EU, and I have been working closely with our institutions on how we can continue to attract that fantastic talent to this country. That is important not just in terms of the economics but for the benefit of our society, culture and the enrichment of some of our domestic students at our universities.

The introduction of the temporary SNCs and the Higher Education (Fee Limits and Student Support) (England) (Coronavirus) Regulations 2020 were the right steps to ensure the stability and sustainability of the sector at the time. It is important for a Government to be flexible and adapt to an ever-changing situation, and particularly the current circumstances. The change to the A-level results meant that temporary SNCs could have discouraged providers from accepting all those students who met their offers and conditions. That would have been unfair to providers and, crucially, to those students. Therefore the original regulations were in no way suitable any longer. In those circumstances, it is right and fair that they no longer apply and that students who have met the conditions of their offer are able to go to their chosen university, and that providers can accept them without undue financial consequences. I therefore recommend the regulations to the Committee.

Question agreed to.

Equality of Funding: Post-16 Education

Steve Brine Excerpts

Tuesday 25th February 2020 Westminster Hall

[Lloyd Russell-Moyle]

I agree that it is not realistic to expect A-level students to go out and work when they should be studying, although a part-time job during A-levels is always positive. I had one myself, and it does grow the person. I will come on to the fact that we are now effectively funding part-time study rather than full-time study.

In this debate, I will focus on the pathways that the vast majority of 16 to 18-year-olds follow: academic pathways through A-levels and the general applied pathways, mainly through BTECs. Technical education has dominated the debate over the past few years. It is a very important area of development and is now the subject of a lot of necessary focus and reforms. What has lacked focus, reforms and money are the A-level pathways and, as I said, the BTEC pathways.

Academic and applied general qualifications are delivered in the main by three institutions: sixth forms in schools, sixth-form colleges that are separate from schools, and general further education colleges. Along with specialist colleges and training centres, they make up the vast majority of the FE sector. I therefore hope that the Minister will focus on those pathways and not on T-levels, which we have debated previously in this place.

Since 2010, the pressure on 16-to-18 education has increased significantly. The coalition Government made the right decision to protect the education budget, but that applies only to students up to 16 years of age. That means that 16-to-18 education has shouldered the burden of the cuts that had to be made in the Department for Education. The three deep cuts to funding, combined with significant increases in running costs, mean that the purchasing power of 16-to-18 funding has declined sharply over the past decade.

I will come on to the impacts that the disproportionate funding arrangements have had on students and institutions, but first I want to highlight two key issues that must be addressed if we are to ensure that the education of the 1.1 million 16 to 18-year-olds in England is properly resourced.

[Steve Brine (Winchester) (Con)]

I think the hon. Member would acknowledge the very welcome recent funding announcement in this area. Peter Symonds College is in my constituency; it is one of the largest sixth-form colleges in England and has had a 30% increase in student numbers over the past decade.

Although the funding announcement is welcome, I am sure that the hon. Gentleman would agree that it is a long way short of what the Raise the Rate campaign asked for. More pertinently, the one-year stopgap funding settlement is the problem. The sector now needs—we are looking to the spending review for it—a much longer-term settlement, so that it can undertake strategic planning.

[Lloyd Russell-Moyle]

Quite right. I will come on to three things: sufficiency, equality and parity. Sixth forms are particularly disadvantaged in the current system, and we need to start fixing these things.

Fundamentally, the funding that sixth forms in schools, colleges, academies and sixth-form centres in general FE receive to educate 16 to 18-year-olds is not sufficient to provide the high-quality education that young people need, and that the economy needs to prosper. Cuts to courses, support staff and extra-curricular activities mean that sixth form, by which I mean academic education and general education in England, is now a part-time endeavour for many students. Although a calculation based on part-time education in technical training may have made some sense in the past—such students spend significant amounts of time in the workplace or another training location—academic and general vocational education has never had that component, and all learning time is spent in the institution. The institution therefore needs the resources for that to happen.

The only way to address the key issue of sufficiency is to increase the national funding rate, which is by far the biggest element of 16-to-18 funding. It is extraordinary that the rate for 16 to 18-year-olds has remained frozen at £4,000 per student since 2013, whereas the rate for 18-year-olds who enter their third year of study—often the young people who require the most help—has fallen to £3,300.