Childcare Bill [HL] — House of Lords, 2015-10-14
Topic: Social Welfare
Margaret Beryl Jones (Labour, Centre-left): My Lords, we have repeatedly said that we support the concept of extending free childcare. It was a manifesto pledge and I do not need to repeat the arguments because in principle we share the Government’s ambitions on this issue, as do most of your Lordships in the Chamber today. But we want a policy that will not just grab the headlines; we want a policy that will work. Sadly, this is where we and the Government part company The truth is that the progress of the Bill has been an exercise in how not to make legislation. The Government have incurred the wrath of both the Constitution Committee and the Delegated Powers Committee. To recap, the Constitution Committee criticised the Bill in the following terms: "Legislation of this type increases the power of the Executive at the expense of Parliament. The Childcare Bill is an example of a continuing trend of constitutional concern to which we draw the attention of the House" Meanwhile, the Delegated Powers Committee described it as a "skeleton" Bill, saying: "The remarkable imbalance between the provision that appears in the Bill itself and what is to be left to regulations, and the scarcity of explanation in the memorandum, has led us to question whether members will be in a position to contribute meaningfully to debates at Committee Stage and Report Stage" Despite the Government agreeing to go away and consider these concerns, the latest report of the committee, issued yesterday, is scathing. It says that the committee is, "surprised and disappointed that many of our recommendations have not been acted upon. It appears to us that the amendments add very little … to the face of the Bill" This lack of detail was raised by us and others in Committee. In order to make progress, the Government made a number of commitments about further information that would be available on Report, at the heart of which was a promise to conduct, and report on the findings of, a funding review which would explain how the additional free childcare hours would be funded. This information is fundamental to the success or otherwise of the Bill In response to our amendments on this issue in Committee, the noble Lord, Lord Nash, acknowledged our concerns. He said that, "we are conducting a thorough review. The review will report in the autumn and will inform our decisions on the level of funding that providers require to deliver quality childcare, and as I said, we will report on these findings by Report".—[Official Report, 1/7/15; col. 2161.] This could not be clearer, but, sadly, this is not what has happened. We will hear today from the Minister that the Government have reported in advance on part of the review—the part based on a call for evidence of people’s experiences in the childcare sector. Of course these responses are not to be dismissed, although, by the Government’s own admission, it was not a scientific survey—but that is not the point. The point is that there are real questions about how these new places are to be funded and what will happen if they are not fully funded. This was to form a central part of the funding review and, sadly, this is what we have been denied so far There were also real concerns from the sector that the way the funding review is being carried out has raised a number of queries. I have received numerous messages of support for our amendments in the light of that. For example, I have received a detailed critique from the CEO of a nursery chain in Stafford setting out his concerns about the way the survey and the follow-up round tables were conducted by Deloitte. He said that the survey questions were far too imprecise and open to subjective interpretation, rather than an attempt to gather detailed unit cost information. He further reported that at a well-attended and well-informed round table in Coventry, there was considerable concern that the evidence already gathered by respected bodies such as Ceeda and the PLA was simply being ignored. But we are never going to have the opportunity to scrutinise this evidence. In fact, we are now being told that the final funding review will not be published until the Chancellor has conducted the spending review on 25 November—well after the Bill will have left the House At its core, this is not about the Government’s disregard of Parliament, important though that is. It is important because we do not believe that the offer being made for free childcare in this Bill is viable without a considerable injection of money. Quite frankly, we do not believe that the Chancellor will be persuaded to find the necessary additional funds to make the scheme work. Why is this important? The current nursery providers gave evidence to the Select Committee on Affordable Childcare that the current scheme is being run at a loss, with complicated systems of cross-subsidy. Put simply, if you increase the free hours, you reduce the opportunities for cross-subsidy, and the whole scheme collapses The Pre-school Learning Alliance, which speaks for many in the private nursery sector, has estimated that the cost will be at least 20% more than the Government’s original estimate of £350 million. It stresses the need for a sustainable mechanism to ensure that funding rates cover delivery costs in the long term, and that is what we are seeking. Meanwhile, a recent IPPR report says that the Government have grossly underestimated the cost of this scheme, which they calculate to be £1.6 billion in 2017-18: £1 billion more than the Government’s estimate. The National Association of Head Teachers found that almost 80% of the nurseries based in schools are cross-subsidising the places from the rest of the school budget, as they are running at a loss, and that two-thirds thought that they would have to reduce the number of children they could accommodate if the new entitlement went ahead.