PARLIAMENTARY DEBATE
Free Childcare - 21 November 2016 (Commons/Westminster Hall)

I beg to move,

That this House has considered e-petition 132140 relating to free childcare.

It is a great pleasure to serve under your chairmanship, Mr Davies.

The petition has so far garnered more than 132,000 signatures, but the amount of public engagement generated through the Petitions Committee has been quite astonishing. We have had 33,000 posts on our Facebook page, which has been viewed by more than 492,000 people. I did a webchat, which, for someone so useless with technology, is a step forward in itself. A number of people also emailed me personally and some of the stories they told were quite heart-breaking.

The difficulties that many parents have to go through simply to go out to work ought to give us all in the House pause for thought. Because of the difficulties they face, some of those parents, understandably, are quite angry, and sometimes their anger—not in the majority of cases—turns against the wrong target, which is those getting free childcare for two-year-olds. I want to set out the position as it is because there is a misunderstanding. Many people think that free childcare for two-year-olds is only available to parents who are unemployed, but that is not the case.

As we all know, all three and four-year-olds are currently entitled to 15 hours of free childcare for 38 weeks of the year. The provision was brought in by the Labour Government for four-year-olds for 33 weeks of the year, and it was gradually extended. It is a universal provision and most families take up their entitlement. That Government also sought to start to extend free childcare to the most disadvantaged two-year-olds, and the coalition Government broadened that further. It is available not only to those on income support or income-based jobseeker’s allowance, but to children in the poorest working families: those in receipt of tax credits and—the last time I looked—with an income of less than just over £16,000. Crucially, the provision is also available to looked-after children, to children with disabilities and to children with special educational needs. I say that it is available to the children, rather than the parents, because that particular policy is aimed at tackling disadvantage in the early years so that children are ready to start school and benefit properly from their education.

The Government have taken a different course, and seek to extend free childcare for three and four-year-olds to 30 hours a week. Crucially, that is not a universal provision. It is for working parents only, and will be subject to minimum and maximum income limits. It is currently in the pilot stage, and I have reservations, which I will come to later, about how it will be paid for. There is no doubt that the situation is very confusing for parents, and it is understandable that many of them are very angry at the problems they face because the cost of childcare has risen alarmingly in the past few years. It rose by 30% on average between 2010 and 2015, which is five times higher than the rise in wages. The parents who have contacted me have told me about the problems they face not just with childcare during the day, but in getting after-school childcare and holiday care.

The hon. Lady is making an important point about the need for flexibility in the timing of childcare. I am particularly encouraged that the Scottish Government, after a major consultation, have launched a series of trials to ensure that, in Scotland, we can offer places where and when families need them. Does she agree that those steps are significant in making the provisions work for everyone?

I agree with the hon. Lady that we need flexible provision of childcare because what we have does not always fit with parents’ working hours. I will come to that later, but first I will give a few examples of the cost to parents.

Of course, costs vary throughout the country, but so do wages. One lady who contacted me from the north-west said that her family pay £840 a month for three days of childcare a week. Now, they are not highly paid and, to put it into context, that is exactly the same amount as their mortgage payment. Another parent from Surrey, at the other end of the country, got in touch with me. She and her husband have a reasonable joint income of £69,000, but they have twins. They have found that the cheapest way to provide childcare for their twins is to hire a nanny, but the cost of hiring a nanny is about £25,000 a year, which is more than a third of their joint income—an astronomical sum. These parents feel caught in a trap that is not of their own making. They want to work and, in many cases, they need to work just to keep their heads above water, yet a huge chunk of their earnings is being taken by childcare.

I was also contacted by a nurse who wants to go back to work in the NHS, and the country certainly needs nurses to go back to work. She found that, for a 12.5 hour day shift, she would be just £25 better off after paying for childcare. Her solution is to work night shifts, which, for various medical reasons, are not good for her. That is an example of the barriers people face just in doing their job.

The other issue that many parents raised with me was one of access, and that seems to be particularly true when one partner is in the armed forces. One family contacted me—again, not pleading poverty. They said, “We have a good income”, but they found that every time they moved, the decent nurseries, at a reasonable cost, were full, and they charge—certainly in the south of England—between £50 and £100 per child just to be put on the waiting list. Frankly, that is a rip-off that the Government could and should end very quickly.

Another member of the armed forces—a single parent who is not earning a high income—told me of the real difficulty she faced in finding childcare that would fit with her irregular working hours. Another family told me that when they move, they find that some local authorities provide free childcare for two-year-olds of military families, and that others do not, but those families have no control over where they are posted or, therefore, whether they can access that provision.

These are parents who are trying to do the right thing and set a good example to their children but, naturally enough, they want the best provision for their children, as we would all want for our children. That is why we should be talking about early years provision and early years education, rather than childcare. We want to provide the best we can for our very youngest children, but the problem is that for many years there has not been sufficient investment in the sector, and there are not sufficient qualified staff. I am convinced, as someone who began her career as a secondary teacher, that if we invested more in the early years, we would prevent many problems further along in the education system. Such a move would pay us because it is the right thing to do not only morally, but economically.

The last Labour Government recognised that problem and they particularly recognised the difficulty of ensuring that we had a sufficiently skilled workforce. Therefore, part of the job of Sure Start centres, which became children’s centres, was about providing day care, but it was also about giving advice to parents and, crucially, working with other providers and childminders to raise standards across the sector. It therefore seems a tragedy that the coalition Government decided to remove from centres in the most deprived areas not only the obligation to provide full day care but the need to employ a qualified teacher. There are some Ministers—I except the Minister present from this—who believe that anyone can teach, but I assure her that that is not the case. I suspect that many members of the Government would not last a day in early years provision. I know that I would not, and I am a qualified teacher. Early years provision is a highly skilled occupation if we are going to do it properly.

At the same time, the Government set up the early intervention grant and ended the ring-fencing of funding for children’s centres. They then reduced the grant year by year, meaning that not enough money was going into the system. The House of Commons Library estimates that the predecessor grants that were rolled up into the early years grants were worth £2.79 billion in 2010. Immediately on taking office, the coalition Government reduced the sum to £2.48 billion, and to £2.24 billion the year after—that is 10% lower than what they spent the previous year and 20% lower than planned. Two thirds of that money was spent on the under-fives, which gives an idea of the impact of the grants on the whole sector.

There was no extra money when the coalition Government expanded childcare for two-year-olds. They paid for it by moving some of the early intervention grant across to the dedicated schools grant, thus starving the rest of the sector of resources. The remains of the early intervention grant continue to go down. The grant was part of the start-up funding assessment when the Government changed to a business rate retention scheme for local government finance, and it was £1.71 billion in 2013, going down to £1.58 billion the following year. This year it is £1.32 billion and, if the indicative totals we have are right, by 2019-20 it will be just over £1 billion.

What is the point of this ramble through the byzantine pathways of local government finance? I must admit that I find it fascinating, but I have never found anyone else who does. The simple reason is that we can have good early years provision and we can have cheap early years provision, but we cannot have good, cheap early years provision. The real problem with what the Government are doing is that it pushes more of the cost on to parents because the free hours are underfunded, and it ensures that the expertise that was being built up in children’s centres is gradually disappearing as they close and as the services they offer are restricted.

There is doubt about whether the extended hours that the Government are offering will be properly funded. The National Audit Office published a report earlier this year in which it said that there was real difficulty because the Government’s implementation of the provision will mean the end of much cross-subsidisation. At the moment if a parent has, say, 40 hours’ childcare a week, 15 of those hours are paid for by the local authority but at a fairly low rate. The hours that the parent takes on are paid at a higher rate to cross-subsidise the other hours. If the Government do not properly fund the extra hours, several things could happen: the quality might reduce; many providers might not take part in the scheme at all; or there might be a further cost for parents because providers decide to charge more for other types of childcare, such as childcare for the under-twos, holiday provision and out-of-hours provision.

Several providers that have contacted me say that they are already struggling to keep going, even though low wages are endemic in the sector. Staff have contacted me about how little they earn, which makes it even more difficult to attract good, skilled staff. Those issues are important to parents because the Government estimate that the parents of some 390,000 children will want to take up the extra hours, which means an extra 45,000 places are needed. In fact, even more places are likely to be needed as the figure is likely to be an underestimate. If the policy is successful in getting more parents into work or in getting parents to work extra hours, even more childcare places will be needed. The Government’s response was to announce last year that they would increase the average national funding rate for early years to £4.88 an hour from £4.56 an hour for three and four-year-olds. That, of course, is an average. Many councils do not pay that amount because they are having such difficulty funding even statutory services that there is not enough money left to fund early years services.

It is fair to say that many providers found the Government’s response unconvincing. The Family and Childcare Trust told the Childcare Public Bill Committee that it was

“unlikely to be sufficient to address the strategic challenge the 30 hour offer presents”.

The National Day Nurseries Association found in a survey of its members that only 45% were likely or very likely to take part in the scheme. If so, the shortage of places that we already face will simply get worse. Already 45% of councils in England do not have enough places for families who work full time.

The second issue to which the Government must face up is where most three and four-year-olds access this provision. Some 58% of them are in the maintained sector, usually in nursery classes attached to a primary school. Many of those schools are on restricted sites and would not be able to expand even if capital funding were available, which at present seems fairly unlikely. There is also a bulge in the number of primary-aged children coming through the system. It does not take a genius to work out that if it is having to address a bulge in the number of primary schoolchildren as well as extra demand for nursery places, any school that can expand will expand to meet the primary provision because it has to—it is as simple as that.

At the same time, the Government risk hugely damaging the best provision in the childcare sector, which is in maintained nurseries. Some 60% of maintained nurseries are rated “outstanding” by Ofsted, and 39% are rated “good.” Nowhere else in the education system even gets near that level of supply. In their consultation on early years funding, the Government say that they want to fund all providers equally. Wherever they are, each child will receive the same amount of funding per hour. That sounds reasonable until we understand that nursery schools are required to employ qualified teachers and a qualified head, and many of the heads in this sector are very well qualified indeed. Nursery schools also provide training places for staff. They do outreach work not only with families but with other providers. The very good maintained nursery in my constituency, Sandy Lane, is based on the same site as a children’s centre and a private nursery precisely so that the three can work together, but they need the funding to do that.

We are in a position where we risk getting rid of the best provision, or hugely damaging it, where the Government are underfunding childcare and where the cost is being heaped on to parents for the extra hours they purchase. Frankly, it is a mess. It is a national disgrace that we treat our youngest children in that way. By trying to do it on the cheap, we are putting huge stress on working families. I would love to be able to say that we can deliver free childcare for all working families, but we cannot do so without more money in the system and without more training for staff.

That situation cannot be solved overnight—it cannot, I believe, even be solved in one Parliament—but we need a national strategy for early years. The Government should consider it seriously and set up an inquiry, perhaps a royal commission, staffed by experts. I know that some Government Members do not like experts, but we need them. They are experts because they know something about the subject. The inquiry should do several things. It should chart a path to, if not free, at least heavily subsidised early years provision, and it should lay out how we can grow the workforce that we need. At the moment, for instance, when we need nursery nurses the most, the number of applications for training is falling. The inquiry should also set out how we can raise the skill levels of people already working in the field.

At the moment, if we are honest, a lot of children are being cared for by unqualified teenagers, who might be nice people doing their level best but who do not have the skills necessary to develop the minds of young children, at an age at which they are developing more rapidly than at any other time in their lives and need constant care. We must amend that to give them the best. I hope that such an inquiry would have all-party support, so that we could take a consistent approach through several Parliaments.

I recognise that it will not be enough to alleviate the problems that parents face now. I urge the Government to consider seriously what they can do to support parents. The first thing that they should do is end a policy that threatens the best provision in the sector. The Government need to consider how to develop maintained nursery schools, how nursery classes attached to primary schools can expand and what capital provision can be given for that. They also need seriously to consider raising the hourly rate paid for the care of under-fives. If they do not, decent providers in the private sector will not be able to continue. Those who try to provide good, decent childcare cannot do it without proper funding. The Government should work much more with businesses to develop workplace nurseries—not simply providing vouchers, but talking to businesses and explaining why nurseries are vital to retaining a trained workforce and why they benefit businesses as well as children.

The Government should also consider giving parents decent help now with the costs of childcare, perhaps by extending child tax credit or by other methods. What is happening now is not helping families or children. We need to stop thinking of early years provision as an add-on that we think about after we have thought about the rest of the education system and realise that it is the way to tackle disadvantage and ensure more social mobility. If the Government concentrated on early years provision rather than grammar schools, they would do much better.

The point about disadvantage is key. Mark McDonald, the Scottish Government Minister for Childcare and Early Years, has identified that high-quality early learning and childcare plays a vital role in narrowing the attainment gap, which is why there is such a commitment to increasing early childcare and education provision.

It is certainly true that it narrows the gap, but I want to make the point that it is good for all children. All children deserve the best provision that we can offer them, and we are not offering them that at the moment. We need to get a grip on the situation, for the sake of families in this country and of our children. If we do not, although we might not pay for early years provision immediately, we will pay the price further down the line in educational failure, social disadvantage and children not reaching their full potential. I urge the Minister, when she replies, to take the issue seriously so that we can at last move forward in this often-forgotten and certainly underfunded area of our education system.

It is a pleasure to speak in this debate and to serve under your chairship, Mr Davies, and to follow my hon. Friend the Member for Warrington North (Helen Jones), who has given us a brilliant exposition of the current problems with funding for childcare. Hopefully I will not repeat much of it, but I think it is interesting that so many people signed the e-petition and, as she explained, wanted to get involved in this debate.

This morning, before this debate, I was lucky enough to be asked to speak on Radio Merseyside—a fabulous local radio station. Often, when I take my little girl to the school gate, I do not have much political discussion there—parents tend to be busy and not thinking about politics—but it was notable to me that this morning when I dropped off my lovely girl, her teacher said to me, “I’ve just heard you on the radio talking about childcare,” and proceeded to talk to me about all the issues. It does not surprise me at all that my hon. Friend has had the experience of all those people getting in touch with her. This is one of the most significant issues that faces our country, and even though it may not appear to be high politics in the conventional sense, it is where politics in our country could most influence families’ lives for good.

I will go back to basics and talk about the principles of why Government should be involved in childcare, and then make a couple of points about how we should do so. In the end, support for families and children, and for parents at work, goes back a long way in our country. Beveridge recognised when he was considering what made people poor that there were two times in people’s lives when they had less earning capacity and extra cost. One of those was when they got old, and the other was when they had children.

Beveridge recognised that having kids had the power to plunge families into poverty that they would not be in otherwise. That is why he designed family support as part of the very nature of our welfare state. He thought that people should be able to smooth their costs over their lives and receive state assistance at times when they had extra costs and less capacity to earn, so that when they had the ability to pay in, they could do so, smoothing their income over their lives to prevent poverty. That is the principle of our welfare state, and it always has been.

Beveridge knew something else as well about preventing families from being poor. He knew that Government needed to be committed to the principles of full employment and prepared to provide public services to underpin good health and good education, to ensure that people had the ability not just in theory but in practical terms to get a job. When I read the e-petition as submitted, with its emphasis on helping working people, I agree with my hon. Friend that that is exactly what our country should be all about. That is why I think we should adopt the same principles, attitude and approach that Beveridge did when he designed our welfare state.

However, there is a crucial difference between the labour market then and now: people like me can get a job. Women now rightly expect to go to work. It turns out that once the historic prejudices against women in the workplace were removed—piece by piece, by those women in the ’50s, ’60s, ’70s and ’80s to whom I owe every chance that I have had as a woman in the workplace—women in great numbers wanted to go to work and have a career. We therefore need to fundamentally rethink the way in which the Government support families when their children are small, and we need to confront the fact that our labour market is now very different. That means that, as a country, we must applaud the nature and instinct of people who want to go to work and we must seek to provide good public services to back up that driving instinct. That simple conclusion is supported by the contribution of the woman who spoke before me on Radio Merseyside this morning, a dedicated Scouse nan called Linda who had gone on the radio to explain how stretched her family was; not just the mum and dad but the grandparents were trying to work and do childcare.

The hon. Lady makes a point that we should all consider very carefully, which is that this issue is not just about women—even though someone who looked around this Chamber might be forgiven for thinking that it was. It is about all of us. It is about everyone in a family: not just the children, but the parents and the wider family too.

I thank the hon. Lady for her intervention. Of course childcare is not just a women’s issue, but it is a fact that the labour market has changed because women have joined it in greater numbers, so we have to rethink how the Government support parents in work. As it happens, I am sure that in my constituency as many men as women care about the cost of childcare. As many granddads as nans are supporting their children to take care of their children. This issue affects the whole family, older and younger alike, for all the reasons that my hon. Friend the Member for Warrington North has set out: costs are cantering away ahead of wages and successive Governments have been too slow to be radical on childcare.

Another reality that we have to face is that we have a productivity crisis in this country: we are still working longer to make less than our competitors, and I think childcare plays a hidden role in that. Over the summer I went back to work—I did days at work with different types of businesses throughout the north-west, including in retail, manufacturing and care. Managers often told me that they wanted to find people to promote from within their businesses, who could do more, earn more and drive the business forward, but that people were not able to take on that extra responsibility because of their responsibilities at home. They did not think that they necessarily had the back-up to step up and get that promotion. Businesses can get people in through the door to do the basic jobs, but helping them to move on brings the risk of their fragile family caring responsibilities being unpicked.

Does my hon. Friend agree that working hours have changed across the whole range of businesses and jobs? When I worked at holiday jobs in retail, for instance, we finished at 5 o’clock—it was 9 to 5. That is no longer the case, and it places a huge burden on parents.

My hon. Friend is correct. These days, retail is 24 hours a day. She makes an excellent case for some sort of royal commission or cross-party inquiry into the matter, partly because we need to take a sectoral approach. The challenges in retail are immense, and so are the challenges in care. The NHS and the care sector need their own childcare strategy. We have a nursing recruitment crisis on our hands, and a lot of it has to do with care. When I was shadow childcare Minister in the last Parliament, I argued that the NHS needed its own childcare strategy, which the Department of Health should lead across Government. That has not happened yet, but it must. In the present situation, with the risk of Brexit and the possibility of an NHS hiring crisis, we must recognise that a lot of the problems are of our own making. Nurses, doctors and other health professionals—women and men—are really struggling to work the hours they need to and to stay in work as they wish to, when they simply do not have the appropriate back-up.

The world has moved on, as my hon. Friend said. We want our businesses to be as productive as they can and our public services to be as efficient as they can. It is therefore incumbent on the Government to think strategically and to question the infrastructure support we offer so that our economy can work well. I know that the Government are committed to cutting corporation tax, but I really question whether that is the priority for business right now. When we talk to people in the business community, they are more interested in business rates than in corporation tax, and they are definitely interested in childcare. The childcare challenge that many employees face is a problem for small and big businesses alike. As the CBI has said, the Government could have a real impact on dealing with the infrastructure challenge that childcare represents.

I have two final points: the first is about children, who I feel always get left out of this conversation, and the second is about a possible way forward, adding to the very good suggestion of my hon. Friend the Member for Warrington North.

Disabled children, who face particular difficulties in accessing the right care and support, are often forgotten in all this. Their parents are entitled to the same childcare support as everyone else. Given the communication difficulties and medical needs that children with disabilities may have, their childcare provision is clearly incredibly important. We now know much more about how to help children with disabilities to progress, but the earlier that help comes in their life—the earlier they get that support—the better and more successful it is. I have seen that with families in my constituency who have children with disabilities. If the Minister takes up my hon. Friend’s sensible suggestion of an inquiry, I ask her to include those who have expertise in working with families who have a child with a disability. We can do more than ever before to give those children the best possible chance of a successful life, so let us do it from the very beginning.

The second group of children who are often forgotten about is those who live in rural areas. Towns and cities face many challenges in getting the right childcare provision, because geography can be a natural barrier to access. Those challenges can often be overlooked in our modern economy. I ask the Minister to think about that too.

Frankly, even for those who do not face those challenges, being a parent of a small child is terrifying. All of us who have ever experienced it know that. We need to move towards universal childcare for a very simple reason, in addition to all the reasons that I have set out about the benefits it would bring to businesses and our economy. Being a parent can be a huge challenge for anyone, and the one thing that gives a parent a little bit of confidence is meeting that key worker in the nursery or the childminder who has brilliant expertise, so that they have someone in their life to ask, “Am I doing this right?” I know that in the past parents coped without help and support, but these days our experience is that difficulties with parenting can strike anybody, whatever their income level or their confidence.

Before my hon. Friend finishes her speech, may I point out that parents in the past had a lot of support? Extended families lived together or near one another, which is no longer the case. People did not look after a baby on their own; they had grannies, aunties and great-aunties all around them. As families become more mobile, that support network tends to disappear, which is a real problem for parents.

That is a very good point. In addition, bearing in mind what we know now about child development compared with what was known many years ago, I would argue that childcare is a real expertise. All parents welcome expertise on the best way to help their child to develop. All the evidence shows that the most important learning years of a person’s life are those when they are very small, but that is terrifying for the parent of a very small person. We know that what we do in those important years will echo down that child’s life and we desperately want the best for them, so it is really great to have a professional there who can help.

We should have a vision that runs from the midwife who cares for the child when they are first born, and for the parents before that, through the health visiting system to which the Government have said they are committed, to that family working with a key worker through nurseries and some universal childcare provision. That way, all through the child’s earliest years, professionals would consistently be around the family to help them, alongside their extended family, where possible.

How do we do that practically, though? I wish to add a final thought to the mix. We have heard from the hon. Member for East Renfrewshire (Kirsten Oswald) about the work the Scottish Government are doing, which is to be commended, but some new devolved institutions are also coming to England. We should look at how childcare is provided through local authorities, because there is a possibility of doing more and improving expertise if local authorities are able to work together across boundaries to come up with a good universal childcare proposal for their area. We might then benefit from the efficiencies of local authorities working together, and it would also help them to think strategically about the educational challenges faced by their city or city region and then to put investment in the right place. Ministers cannot know that from Whitehall. With the greatest respect to the Minister, she is never going to have a fine detail of knowledge about the best childcare arrangements for Merseyside, but we could do that in Merseyside for ourselves. Will the Minister think about how resources could be devolved out of Whitehall and given to city regions or groups of local authorities working together?

I am afraid I agree with my hon. Friend the Member for Warrington North: in the end, I do not believe we have backed up our children with nearly enough finance. Nevertheless, if we are going to spend more on childcare, let us do it in an effective way that respects the different challenges faced by cities throughout the country and does not dictate from Whitehall how it should be provided. If we do that, people will get a real sense that the Government are prepared to back them up. Our economy will most certainly feel the benefit, but—much more importantly—so will every family in the country.

May I correct the hon. Lady? Although there is an additional £1 billion, the figure is actually £6 billion by 2020.

The hon. Lady is making a compelling case. Does she agree that there is a compelling need for both partners in a household to work, and that sometimes inhibits childcare provision? If they do not work, they will not be able to pay for that provision.

Does the hon. Lady agree that her argument is an absolutely cast-iron reason why this issue has to be addressed in a devolved way? It has to be devolved down to the best possible level, because local economies are different and not everything can be dictated from Whitehall.

I am interested in what my hon. Friend says about Aberdeen, which is one of the areas taking part in a pilot scheme to examine the different models of childcare that might suit families in different areas of the country, as part of the Scottish Government’s aim to double childcare provision. Does she agree that it is very important that childcare matches the needs of not only the local area, but individual families, whose work lives may have very varied patterns?

That is an incredibly important point. Nobody I know, or almost nobody, works from 9 am to 3 pm. If I had not been able to get childcare provision from 8 am to 6 pm, including for holidays, I would have had to stop my career progression when my children were little. It is really vital that we do not impede women, children or families in that way.

It is a pleasure to serve under your chairmanship, Mr Davies. I pay tribute to my hon. Friend the Member for Warrington North (Helen Jones), who opened the debate, for all the work she has done in raising the importance of the issue we are debating. She said at the beginning of her speech that she was not very savvy about technology, but she has done an amazing job, not just by having web chats but by engaging a record number of people on Facebook—mothers and fathers from across the country. It is not just about social media, however; it is about the number of face-to-face meetings she has had, the amount of research she has evidently done and the personal experience, as a secondary schoolteacher, that she has brought to the House. There are lots of people in Government who might not believe in experts but I believe in listening to them, and it is evident from my hon. Friend’s speech that she knows what she is talking about.

This is the first debate I am responding to as shadow Minister for early years, but I do not need to have that role to recognise that to give every child the best start in life, nothing is more important than the care they receive in the first few years. High-quality childcare is critical for our economy, as has been mentioned over and over by Members on both sides of the House. The biggest barrier for parents and carers returning to employment is the cost of childcare, and parental employment is vital to lifting families out of poverty.

I grew up in London in the ’80s and I remember the struggles my parents had when it came to providing childcare. We did not have grandparents around—something other hon. Members have mentioned. Before 1997, access to childcare, as well as its quality, varied enormously, and it is not a secret that Labour revolutionised the sector by introducing universal free childcare. Every three and four-year-old became entitled to 15 hours’ free childcare a week for 38 weeks of the year, which was a life-saving opportunity for parents. The measure was a huge success, with more than 90% of children aged three and four benefiting.

Another thing I benefited a lot from—as I am sure parents on both sides of the House have too—were the Sure Start centres, which were also created by a Labour Government and which served every family in the community, regardless of how much money they had. Labour expanded school nurseries and more than doubled the number of childcare places. Most importantly perhaps, we extended maternity leave from 12 weeks to 12 months, increased maternity pay and introduced paternity leave. It is shocking that it took so long, but it happened. We made childcare a key part of our plans to support families and to make work pay, but today’s debate, in 2016, shows that huge challenges remain.

Make no mistake, the petition speaks directly to the failure of the Government’s childcare policy over the past six years. Nevertheless, it is clear that hon. Members on both sides of the House, of different political colours, feel they have shared ambitions for childcare. Even if we believe in different ways of achieving those ambitions, we agree that childcare is a priority that needs to be addressed. The Government’s response to the petition fails to recognise, I am afraid, the effects of chronic underfunding on providers, but it at least acknowledges that childcare costs profoundly affect parents across the country. Labour agrees with the Government that disadvantaged two-year-olds are less likely to access formal early education than their more affluent peers and that they therefore deserve the support that will level the playing field. Further, we do not believe that we should pit those out of work, often because of circumstances beyond their control, against working parents struggling to afford childcare. We believe a distinction needs to be made between work incentive schemes and policies that must be pursued to give equal opportunities in life to impoverished children, and also to children who are disabled—a point made movingly, over and over, by my hon. Friend the Member for Wirral South (Alison McGovern).

The Government should also be frank about the fact that those out of work are not receiving the free childcare to which their two-year-olds are entitled, with only 42% of families in England who qualify receiving it, which compares with the uptake of Flying Start provision for two-years-olds under the Labour Administration in Wales, which stood at 86% in 2015.

I am sorry to interrupt the hon. Lady’s flow, but I would like to correct her, as she has just given out a completely factually inaccurate statistic. Some 70% of eligible two-year-olds are taking up their entitlement to a funded learning place.

I thank the Minister for her contribution, but the source I have, which I believe and which is very credible, says that it is 42% of families, so we will have to figure out who is right. I would just like to point out again that under the Labour Administration in Wales the uptake of Flying Start provision for two-year-olds stood at 86% last year.

Labour believes that the Government have failed to deal with unacceptable local variations in the information that is available to families who could benefit from the childcare offer for two-year-olds. I have seen it myself, when knocking on doors in my constituency, and the Public Accounts Committee has heard that only 30% of parents are even aware of the family information services. That weakens the value of the childcare already on offer, when the socioeconomic gap in educational attainment is large and the benefits that come from high-quality provision for disadvantaged children are clear for everyone to see. Extending the entitlement to 30 hours a week for working families is likely to place further strain on quality and access for the most disadvantaged children, so we need to tread carefully. Labour believes that that is due to the policy criteria, the capacity of the sector and the quality of the provision that can be offered under the current funding rates. Will the Minister outline in her response how her Department will improve the quality and consistency of the information available to parents and also explain how providers can double provision with the funding they currently have?

It is clear that Government measures to help working families have been insufficient and have led to the justified anger seen in the petition. Over the last Parliament, the cost of a part-time nursery place for a child under two increased by 32%. A family paying for that type of care now spends in excess of £1,500 more than they did in 2010, and wages have been largely static, which adds to the pressures on working families. The member of the public whose Facebook post prompted the conversation we are having spoke for many when he said:

“Myself and my wife work full time and pay over £800 per month for childcare…If we had another child, I would have to give up my job, as it’s simply outrageous the amount we have to pay”.

On the Facebook page are other poignant comments by people who are struggling to make ends meet because of childcare costs. That individual’s experiences are also reflected in research by the Resolution Foundation, which shows that more than a third of mothers who want to work are unable to do so because of high childcare costs. That issue was referred to by the hon. Member for Aberdeen North (Kirsty Blackman), and my hon. Friend the Member for Wirral South spoke extensively and eloquently about the problems of the current labour market. She told us the story of Linda from Merseyside. I can safely say to her that there are countless other Lindas, not just in my constituency but across the country, who will be able to relate to that story. Of course, childcare is not only a women’s issue—a point that has been made—but it is no secret that the pressures of childcare fall disproportionately on women, in lots of situations, especially the one that the hon. Member for Aberdeen North mentioned.

I want to come back to the tax-free childcare scheme that the Government speak about. The Government talk about helping those who are just managing, but the cap on working tax credit means that in 11 local authorities the average cost of part-time childcare now exceeds the support on offer. Furthermore, the tax-free childcare scheme, which I am sure the Minister will mention, has been poorly communicated and twice frustrated by Government delays. Research has indicated that the scheme will only deliver for those on high incomes, meaning that it may not support the families who need it most. Labour believes that it is proving to be a wasted opportunity in addressing the root cause of mounting childcare costs, not least for those struggling to make ends meet.

I also want to touch briefly on the funding formula and the lack of places. We believe that the extortionate costs that parents face—different Members have mentioned that over and over again in this debate—are the result of reduced funding being given to providers and the shortage of places available. Under the new early years funding formula, many providers will receive a much lower hourly income for free early education places, which is a disgrace. That reduction is happening when providers are experiencing higher running costs and expanding provision to keep alive the Government’s pledge of 30 hours of free childcare a week. Anyone who listened to the last Education questions will know that I have raised the issue over and over again.

The Family and Childcare Trust reveals that the number of English local authorities reporting a shortage of free early education places for three and four-year-olds has more than doubled. Figures from the House of Commons Library show that the number of places available has fallen by 45,000 since 2009. The figures speak for themselves. The Department for Education recently announced that it was paying £3 million for a private consultancy to find the 45,000 places needed to make the 30 hours’ free entitlement work. That is a choice figure. The costs that providers face, such as business rates and pension auto-enrolments, are fuelling the rapid increases in childcare costs. However, what worries me is that more than one quarter of local authorities will lose money through the funding formula while being asked to manage the costs and to double the childcare entitlement. A 2015 report by the Institute for Public Policy Research explored the possible consequences of such a funding gap. It said:

“Underfunding the 30 hours offer would lead to a smaller, less flexible market as providers…either exit, reduce the breadth of services that they offer, take on fewer children, or refuse to offer the free hours…This would reduce parental choice and potentially push up costs for paid hours or other services outside of the free offer, such as childcare for most under-3s”.

I will draw my remarks to a close, because I want to hear what the Minister has to say. In addition to their punitive funding formula, the Government have as yet refused to commit to supplementary funding for nurseries beyond the two years. Nurseries have been clear, both in the conversations I have had and in writing to all Members of the House, that the cocktail of funding pressures will ultimately push them into an unsustainable financial situation. My hon. Friend the Member for Warrington North eloquently referred to that in her speech. I hope the Minister will put an end to the uncertainty and immediately commit to funding to guarantee the long-term future of nursery schools.

Labour believes that working parents are bearing the burden of the Government demanding unachievable expansion in provision while providing woeful under- funding. It is no secret that the autumn statement is happening this week. We demand that the Chancellor provides parents and teachers across the country with the funding to keep nurseries open, to reduce the costs of funded places and to meet the Government’s 30 hours promise to parents. I hope the Minister will be able to offer even the slightest encouragement that those figures will be in the Chancellor’s autumn statement.

I finish by echoing the words of my hon. Friend the Member for Warrington North, who secured this debate. The early years cannot just be seen as an add-on. They are crucial to social mobility and to children reaching their full potential. Most importantly, they are crucial to the future of our country and the productivity of our economy.

It is a great pleasure to serve under your chairmanship, Mr Davies. I congratulate the hon. Member for Warrington North (Helen Jones) on securing this important debate and on all the hard work she has taken part in leading up to today, including all her various online activities. Regardless of her technical expertise, she has certainly triumphed. I am delighted to be here to set out the Government’s childcare offer to parents. As you know, Mr Davies, one of our top priorities is to give children the best start in life and to support working parents.

I congratulate all the Members who have taken part in today’s debate. Almost without exception, their contributions have been helpful and constructive and have shown that we all share a common goal, which is to support working parents and children in getting access to the best childcare, to work together with that aim, to share best practice and to find a common ground to build on. I say almost without exception because, while I welcome the shadow Minister to her place—I know that she is quite new to the shadow Government—I gently say to her that there was nothing positive or constructive in anything she said. At no point did I get the sense that she wanted to work with me on this area to make it work. All she wanted to do was make cheap political points in the name of the Labour party. She might as well have been dressed as a great big red rose and be done with it, but this area is too important for political point scoring. It is about children’s futures and parents being able to get out and work and make the money they need to run their families. It is not about cheap political point scoring, and she should be ashamed of herself. However, I congratulate the others who spoke.

I have been in the same position as other Members. I am a working mum, and the decisions I have made about my children’s education and their childcare have been among the most difficult I have ever made. It is difficult being in that position. For many years I was a single mother who felt like she was working only to pay for her childcare, so I understand how people feel. Wearing my other hat as the Parliamentary Under-Secretary of State for Women and Equalities, I go round the country speaking to many women, and they tell me that the biggest obstacle to them getting back into work and fulfilling their potential is the cost of childcare. That is why we want to get things right.

The petition asked why we give free early learning to the two-year-olds of non-working parents. I want to be clear up front that the Government are proud to provide early learning to the most disadvantaged two-year-olds. We want to ensure that all children get the best start in life, regardless of their background. Unfortunately, evidence tells us that children from less advantaged backgrounds can be up to 19 months behind in their learning by the time they start school. We all know that gaps in learning can start appearing as early as 22 months of age, but high-quality early learning from the age of two can narrow that gap, helping those children to achieve better GCSE results and ultimately earn higher wages.

For that reason, in September 2013 the Government introduced the early learning for two-year-olds programme. Initially, it was for the most disadvantaged two-year-olds from non-working households in England. The programme was later expanded in September 2014 to include low-income working parents, as well as looked-after children, children who have left care, adopted children and children with special educational needs and disabilities. Now, 40% of two-year-olds are eligible. The Government are committed to supporting those parents who are just about managing, and the policy is focused squarely on those families.

Looked-after children and children who have left care can face multiple challenges in progressing well in the early years and at school. As a group, they persistently underachieve at key stages 1 and 2. As we know, adoptive parents are brilliant and play an incredibly important role. The Government want to ensure that they and their children get the best possible start and support. Giving adopted children an early education place is one aspect of the Government’s significant package of adoption support.

Research indicates that children with special educational needs and disabilities particularly benefit from early education. It helps their development and improves their social inclusion and wellbeing. However, families sometimes find it difficult to access appropriate care and can face higher costs. The hon. Member for Wirral South (Alison McGovern) spoke about that, and she did an excellent job while she was the shadow Minister for childcare. Since 1 September 2014, two-year-olds entitled to disability living allowance, or those who have a current statement of SEN or an education, health and care plan, have been entitled to an early education place. Our new offer for three and four-year-olds includes a £12.5 million disability access fund to support disabled children in order to access the free entitlement.

I thank the Minister for giving way and for her kind remarks. I have one specific question on children with disabilities. Often it is the perception of difficulty in welcoming children with disabilities into early years settings that is a problem. Are the Government working on a way to break down barriers so that nurseries and childcare settings make it clear to parents of children with disabilities that they are welcome?

Absolutely. The hon. Lady makes an excellent point. We have heard a lot today about maintained nursery schools, which do a fantastic job with children with special educational needs or disabilities. They need to be supported to carry on doing that work.

Many maintained nurseries have special units for children with special needs. They take in disabled children. Does the Minister accept that that is another reason why maintained nurseries need to be fully supported in the extra responsibilities that they take on?

Absolutely. I am a great fan of maintained nursery schools. There is one in my own constituency, which has significant pockets of deprivation, that provides outstanding support for children. That is why the Government have committed, as part of the funding formula, to an extra £55 million a year for at least the next two years to support maintained nursery schools over and above the normal funding formula. Maintained nursery schools make up only 3% of childcare places. However, 98% of them are good or outstanding and 80% work in areas of disadvantage, which is why we want to consult them further about how we can support them in their very important work.

We know that good quality education at two can have a fantastic effect on a child’s development. We want children in care, children who have left care, adopted children and children with special educational needs and disabilities to benefit from that, as we have a duty to help them thrive and reach their potential. It is unacceptable that a child should have inferior life chances because of their background; this programme is key to tackling the problem. I am sure all hon. Members would agree that it is vital we help such children.

I did not know that interesting statistic. The hon. Lady is right. Providing better early education can only ever be a really good thing.

Some hon. Members have asked why all two-year-olds do not get a fully funded place. Such places are not offered to all two-year-old children because evidence tells us that the greatest proportion of parents return to work and need childcare when their children turn three. Some parents feel that two years is too young for their children to be in formal childcare and prefer to keep them at home. I was similar to the hon. Member for Aberdeen North and did not stay in the childcare environment for as long as I could have done. That probably gives me an added respect for the amazing individuals who work in that incredible profession.

We wanted to focus resources where they would have the greatest impact for the largest number of families. That is why we prioritised the introduction of an additional 15 hours for the working parents of three and four-year-olds.

The main driver behind the two-year-old programme is to improve outcomes for the children who need the most help in getting the best start in life. For that reason, we do not impose conditions on parents who are eligible for a place, but we hope the programme will support parents from poorer backgrounds to move into employment and training. We have come an incredibly long way since 2013. As I have already mentioned, 70% of eligible two-year-olds now take up their entitlement to a funded learning place.

We also know that 84% of all two-year-olds who take up their entitlement do so in good or outstanding settings, which means that children are receiving their learning in high quality environments. That is fantastic progress and will ensure that thousands of disadvantaged children get the right start in life.

I am sorry the Minister seems a bit rattled by what I have said. I am the Opposition spokesperson and I will hold the Government to account and do my duty in making sure that childcare is properly provided to parents; and I want to hear about the funding. The statistic I cited, which the Minister disputed, was from the Family and Childcare Trust childcare costs survey 2016. In England, the uptake of free early education among two-year-olds stood at 58% in January and at 46% in London. I would like to hear what the Minister has to say.

I am keen to tell the hon. Lady what I think. Because she is very new to her role, I am prepared to cut her some slack. If she chats to her hon. Friend the Member for Wirral South, she will find that she can hold the Government to account in a constructive and positive way, rather than in an endlessly and relentlessly negative way.

Will the Minister give way?

No, I have given way enough. In answer to her question, the figures are the Government’s figures and they are correct.

I want to make progress. We know that it is not only the most disadvantaged parents who need help with childcare costs. That is why we are increasing our investment in childcare from £5 billion to £6 billion a year by 2019-2020. We remain absolutely committed to providing 15 hours a week of early learning to all parents with three and four-year-olds. In addition to this universal entitlement, we will introduce 30 hours a week of childcare from September 2017, which will support more than 400,000 working families with three and four-year-olds, saving them around £5,000 a year in childcare costs. We want to remove the real financial barriers that prevent parents from going back to work or increasing their current hours, so that they can realise their potential and contribute to our economy and their children’s future.

I echo the Minister’s sentiments about removing financial barriers. Does she agree it is also important to remove structural barriers as far as possible by making sure there is flexibility of provision and that we do not continually assume that one size will fit all?

The hon. Lady is right. Flexibility is really important, which is why our recent consultation response committed us to offering free hours between the hours of 6 am and 8 pm to meet the needs of parents who work shifts. We also encourage local authorities and providers to offer the free hours over more than 38 weeks a year so that parents can stretch their hours, whether it is fewer hours over more weeks or during the school holidays. The flexibility that she talked about is really important.

At present, the Government are piloting the programme in eight early implementer areas. The hon. Member for Aberdeen North spoke about the importance of the really good trials going on at the moment. It is the same in the early implementer areas. Through these early implementers, more than 3,500 children have already taken up a 30-hour place one year early, which is giving their parents more disposable income and an opportunity to return to work or work more hours. We expect that figure to increase during the course of early implementation, because more parents will become eligible for the extended entitlement at different points during the year. I want to put on the record my gratitude to Hertfordshire, Newham, Northumberland, Portsmouth, Swindon, Staffordshire, Wigan, York and the childcare providers in those areas who have worked tirelessly to make the programme a reality.

The eight early implementers provide us with an opportunity to address key delivery issues for the 30-hour offer, and for us to test the practical ways that councils and providers can work together. Various Members have spoken about the specific challenges of different areas of the country: for example, the challenges in Aberdeen with the offshore workers. My constituency has a lot of families with partners in the armed forces, particularly in the Royal Navy, who face a similar challenge. That is why we have various early implementer pilots going on to look at all such challenges. For example, Northumberland is focusing on rurality and Staffordshire is focusing on work incentives, as is Swindon, along with flexibility, including the use of Saturday provision via a nursery attached to a hospital to support the staff who work there. Newham is focusing on developing a range of delivery models and supporting children with special educational needs and disabilities. Wigan and Hertfordshire are exploring partnerships through the use of childcare hubs and supporting parents back into work, and Portsmouth is supporting low-income families.

[Ian Paisley in the Chair]

Alongside our early implementers, we have also recruited 24 early innovator local authorities, which will provide valuable learning to support the roll-out of the 30-hour offer by developing approaches to support children with special educational needs and disabilities; developing scalable, flexible models that meet the needs of working parents; ensuring the sufficiency of the local childcare markets; and stimulating parental demand for the new entitlement to act as a work incentive.

I would like to point out that the consultancy that the Opposition spokesperson said £3 million is being spent on is actually not a consultancy; it is a contract to offer practical support to local authorities and childcare providers to help them get ready to deliver the 30 hours. It includes sharing lessons from the early implementers—

It is a consultancy.

It is not a consultancy. It provides courses and shares best practice. It is about being out there, on the ground, speaking one-to-one to administrators and deliverers. The hon. Lady really needs to look up the meaning of the word “consultancy”. It offers practical help on the ground to providers, and helps them to get the very best out of their business models.

The lessons learned from the combined delivery approach of the early implementers and innovators offer a unique opportunity to provide vital information to the local authorities getting ready to meet parental demand when national roll-out takes place. We are capturing learning throughout the year and sharing it with all local authorities to ensure that early implementation is a success—that is what the £3 million contract is about—and that full roll-out has the benefit of the learning that success generates. The more planning and testing we can do in the widest possible number of areas, the more likely we are to have a smooth launch of this key Government priority.

At the same time, the Government will introduce tax-free childcare from early 2017, which is intended to help parents with the cost of living by subsidising the cost of childcare. The tax-free childcare will be paid per child, rather than per parent, and childcare costs will be subsidised for children up to the age of 12, or 17 if they are disabled. The Government calculate that, once it is fully implemented, about 2 million working families across the UK will have access to the new scheme. It will give parents a 20% subsidy on their childcare costs, up to a maximum contribution of £2,000 per child per year, or £4,000 for disabled children. The scheme will effectively subsidise 20% of childcare costs—up to £10,000 per child.

In addition, the Government’s flagship welfare reform programme, universal credit, also offers help with the cost of childcare for parents on lower incomes, even if they work only a few hours a week. Working parents on universal credit can now claim up to 85% of their childcare costs. Together with the 30 hours and tax-free childcare, that amounts to an unprecedented level of support to working parents for their childcare costs.

The hon. Member for Warrington North talks as though the high cost of childcare—we all know it is high, and I have outlined the many things the Government are doing to tackle it—is a recent phenomenon. Many hon. Members who spoke today have the advantage of having youth on their side and of having young children— I am jealous of them—but I was a parent during the previous Labour Government, which the Opposition spokesman spoke about in such glowing terms. I put my children through early years childcare under a Government who presided over the most expensive childcare in Europe. I was working to pay for my childcare. The Government introduced the 15-hours offer, but not everybody offered it, and I had great difficulty accessing it. Childcare is one of the biggest obstacles to women getting back into work, which is why it is important that we have all the schemes I have talked about.

I am sorry, but I cannot let the Minister get away with that. She is right that childcare has always been expensive, but the Labour Government expanded the number of childcare places in this country hugely and set up Sure Start and children’s centres for the first time. She cannot get away from the simple fact that the cost of childcare went up 30% under the coalition Government—five times the rate of wage growth. That is what has put so many families in such a difficult position.

As the hon. Member for Wirral South said, this is not a recent phenomenon; it has accumulated over a number of years. I can speak only from my personal experience—I know that the children of the hon. Member for Warrington North are a bit older. My children were accessing early years childcare during the years of the Labour Government, and I saw those prices go up exponentially. That is why we are dealing with this issue. In addition to various other policies that help many of the issues that have been described today, such as giving people access to flexible working and shared parental leave, which was never introduced under the previous Labour Government, more than £6 billion will be spent on childcare by 2019-20 in cash terms—[Interruption.] I know the hon. Lady is not listening, but that is more than any other Government have ever spent on this issue. It includes an extra £1 billion on the free early years entitlement.

The Minister is being very generous in giving way. Will she humour me and agree that the Scottish Government have gone further than any other Government in their commitment to early years education and childcare?

I do not know, but I am keen to learn from best practice wherever I find it, so I will be hot-footing it back to my office directly after this debate to see what we can learn from what is happening in Scotland.

A large amount of the additional money that we are spending on childcare is going to increase the average funding rate. The Opposition spokesperson said it is going down, but it is actually going to go up for private and voluntary providers in 88% of local authorities, including that of the hon. Member for Warrington North, where the hourly rate will go up by 19%.

The Minister is missing out the fact that going up from a low hourly rate to a slightly better one does not solve the problem. The Government’s problem when they introduce the 30-hour provision will be that, unless they fund those hours properly, they will simply raise costs elsewhere in the system, so parents will be unlikely to benefit. Once the cross-subsidisation is taken out, costs will go out somewhere else, whether for under-threes, out-of-hours childcare, or whatever. The low rate of funding throughout the system is what needs to be addressed—it leads to some providers struggling to maintain their provision and to endemic low wages in the sector, which work against recruiting skilled workers, and it does not provide the best quality of care.

I do not understand why the hon. Lady is saying that what we are doing is already leading to that, because we have not yet done it. The early years funding formula response has not even been published—it will be out soon. She is sniffing at a 19% rise in her area, according to the figures we saw in the summer, which seems a little unkind.

I was also a little disappointed with how the hon. Lady described early years professionals. She talked about them as unskilled teenagers, slightly undermining the quality—

On a point of correction, I am sorry, but the Minister misquotes me. I said that children needed the best skilled and professional care but that some of them are being looked after by unqualified teenagers, who are not the professionals in this. The professionals are those who have the proper qualifications and experience. She really must not misquote me on that, because I was clear that the best outcomes for children are when they are looked after by skilled, experienced people.

I am grateful for the clarification, but the hon. Lady should be aware—I hope she already is and is just playing with me—that the quality of the workforce is already good and has been improving: 87% of staff in full-day care settings are now qualified to level 3, the proportion of such staff with at least that level having grown from 75% to 87% between 2008 and 2013, while the proportion of those with a degree or higher increased from 5% to 13%. We are not, however, resting on our laurels. We have a workforce strategy that will seek to support even further those excellent people who work in our childcare environment.

Regardless of the difference of opinion between the Minister and the hon. Member for Warrington North (Helen Jones), will they both agree with me that the quality of staff in those childcare establishments is absolutely key? It is one of the main things that makes it possible for mothers and fathers to feel confident about leaving their children in such establishments. The staff’s work is exceptional.

The hon. Lady is right: the work those staff do is exceptional. Any of us who have had access to early years education all know that the quality of early years childcare is exceptional. Recent Ofsted statistics show that 91% of providers in the early years are good or outstanding, and that is the highest such figure we have ever seen. Alongside that, the most recent EYSS—early years SEN support—outcomes data show that almost 70% of children are reaching a good level of development by the age of five.

I thank all Members who have contributed to this important debate. I hope they can see that the Government care enormously about outcomes for children and childcare costs for all parents. It is completely unfair for children who are disadvantaged not to have the same opportunities as others, but the significant burden that childcare costs can have on parents is also unfair, which is why we have put in place all the measures that I have mentioned today to help solve the problem.

I only want to make a few remarks to wind up. I am grateful to the Members who have spoken, but I am disappointed that the Minister has still not responded to efforts to reach a long-term solution to the problem, and one that can command support over several Parliaments, if necessary. We do not yet have that, and we will not get it without proper inquiry into the way in which we do early years education in this country. We should not elide childcare with early years education, and early years education is what we really want for our children, by the best-qualified and most experienced staff. She needs to address both the shortage of early years teachers—I say “teachers”, not other staff—and, despite what she has said, the underfunding. We need to progress to a long-term solution to the problem, and I am sorry that she did not address it in her closing remarks.

Question put and agreed to.

Resolved,

That this House has considered e-petition 132140 relating to free childcare.