Childcare

Wera Hobhouse Excerpts

Monday 13th September 2021 Westminster Hall

[Wera Hobhouse (Bath) (LD)]

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.

--- Later in debate ---

[Vicky Ford]

I thank the hon. Member for her great interest in this subject. We see the number of providers joining and entering the market through the Ofsted register, and we have looked at the providers joining and entering based on areas of deprivation. As I said, those leaving the market are less likely to be providers in disadvantaged areas of the country. Only 12% of those leaving the market were in the most deprived areas.

In the last statistics in March 2021, there were reported to be about 1.3 million places in childcare settings. That has stayed stable over the past five to six years, despite the fact that year on year, for the past few years, we have seen on average a 3% drop in the number of children being born. We have regular contacts with local authorities, and we are not hearing about systemic failures in any local area or about parents not being able to access childcare. They may not be able to get exactly the place or the flexibility they would most like, but there is not a systemic shortage.

High quality childcare, delivered by trained, dedicated staff makes a real difference to children’s outcomes. I include and value childminders when I talk about high quality, dedicated staff.

[Wera Hobhouse]

We have said here a number of times that one in 10 childcare workers lives in poverty. Does the Minister think that is acceptable?

[Vicky Ford]

I think it is extremely important that businesses involved in the childcare sector pay the national minimum wage. The 8p and 6p an hour by which, as I said, we have increased the average early years funding, have been more than enough to meet the increases that have been announced in the national minimum wage. That was certainly true in those 8p and 6p increases that we gave last year.

What is really important is the quality of our childcare. Parents not only want childcare, but they want to know that their children are loved, safe and well educated, so high quality childcare is important. We have achieved so much here. The last time we assessed our five-year-olds, nearly three quarters—three out of four—of our country’s youngest children had achieved a good level of development. That is a massive improvement, because back in 2013 it was only one in two of our children.

I know that there are many questions about funding. My officials are in regular discussions with the Treasury as we prepare for the forthcoming spending review. Throughout the pandemic, the early years sector has been a cornerstone of protecting livelihoods and family life, letting our youngest children enjoy their early education with minimal disruption and helping to secure a positive future for each one of those children. I reiterate my deepest thanks to all those who work in early years.