Childcare: Affordability and Availability

[Geraint Davies in the Chair]

I beg to move,

That this House has considered the affordability and availability of childcare.

It is a pleasure to serve under your chairmanship, Mr Davies, and we hope that Sir Christopher, who was due to chair this debate, is okay. I sought this debate because we face a crisis in childcare. I have heard from nursery providers, parents, national experts and my local council about the scale of the crisis, which I doubt even Government Members will try to deny.

The universal availability of good-quality, affordable childcare really matters: it matters in the early years, it matters at the start and end of the school day, and it matters at half-term and in holidays. Why? It matters to children and to their development, because it helps them to learn social skills and how to interact with those around them. Yet, according to the Sutton Trust, too many children are now starting school without these basic skills, and more of those children are at schools with the most deprived intakes.

Adequate and affordable childcare enables parents—mothers, in particular—to return to work and to work full time, yet many mothers, regardless of what they earn, are deciding to delay going back to work, or have to work part time, because of the affordability crisis or the lack of availability locally.

This crisis must surely also add to the gender pay gap. Groups such as Pregnant Then Screwed have been tireless campaigners on the issue, and over the past week I have heard from many women about it. Sadly, I am not able to quote them all, but I will share some of their experiences. Katerina, a teacher, said:

“As an educator, it’s mind-boggling that my monthly take-home earnings barely meet our childcare costs. We are forgoing many other purchases and necessities, and have no plans for the future.”

I thank the hon. Lady for bringing forward this debate, and I apologise that I cannot be here for the whole of it. In Northern Ireland, a full-time childcare place is £170 a week, which equates to £680 a month or £8,000 a year. For a working family with two children, we are talking about an extortionate amount of money. These families are often forced to rely on grandparents or to cut their hours accordingly. Does the hon. Lady agree it is time for the Government and the Minister to look at the cost of childcare not just in England but across the UK and to take the steps necessary to ensure that working parents can afford childcare without being plunged into poverty?

I thank the hon. Gentleman for that excellent point. This is a universal issue across the UK and affects people at all income levels and in all areas.

I recently spoke to a friend who has a young baby and who is planning her return to work, having struggled to find a nursery place. She told me that Sweden, where her brother lives, pays £100 per month per child for a nursery place. However, across England, childminders are packing up and nurseries are closing or cutting places.

I thank the hon. Lady, my constituency neighbour, for giving way, and I congratulate her on securing this extremely important debate. On the supply of childcare, does she share my concern that Ofsted figures show that 10,000 childcare providers closed last year alone and that there was a net reduction of 4,000 overall? Analysis by the London Early Years Foundation shows that many of those providers are in disproportionately poorer areas, where people cannot afford to pay for childcare.

By highlighting those shocking Ofsted figures my neighbour from Twickenham has powerfully expanded on the point I was making.

The Minister will no doubt describe the various Government support mechanisms for childcare, but they are not working. Government per-place funding for funded places is falling further and further behind the cost to providers. Providers in less well-off areas are struggling because they cannot rely on fees to top up their income. That means that places are hit even harder—yet another example of the Government levelling down.

Then there are the estimated 15% to 20% of children with special educational needs, who face further inequality due to the lack of specialist childcare. As documented by Coram, there is inadequate funding for SEN childcare. A survey by the Early Years Alliance found that 92% of childcare providers have to fund additional support for children with special educational needs and disabilities out of their own pockets.

[Yvonne Fovargue in the Chair]

On the challenges that childcare providers face, I met local early years leaders in my constituency in November. They told me that, although the pandemic had affected their viability, the cost of living and the funding crisis are having an even bigger impact and are doing even more damage. Their food costs are up 40%, their energy costs have more than doubled, even after Government support, and their business rates are up—a triple whammy. Those cost increases have not been met by an increase in the funding rate for so-called free places. Providers cannot afford to keep passing on the increasing cost of delivering high-quality childcare and education to parents. The Government need to see the huge cost to parents and the huge cost to providers as two sides of the same coin. It is creating a perfect storm, which is causing a crisis.

This crisis is not the fault of the childcare providers, who are working tirelessly up and down the country. It has been fuelled by 13 long years of a Conservative Government who have failed to act.

I thank my hon. Friend for bringing this important debate to Westminster Hall. I want to pick up her point about covid. Last year, research on the impact of the covid pandemic on early childhood education and care revealed that considerably more children from ethnic minority and disadvantaged backgrounds have missed out on formal early learning. It will surprise no one that, as a result, the inequality gap has widened, and the attainment gap is also likely to widen. Does my hon. Friend agree that, if we want this trend to be reversed—and I think everyone across the House does—the Government need to focus on ensuring that disadvantaged children have equity of access to quality early years education?

My hon. Friend is absolutely right: the inequality in the provision that does exist means there are stark differences within different communities and between families in different situations. The poorest and most disadvantaged children are the ones who need good-quality childcare from day one, as soon as they leave their parents. They need it more than anyone.

In low-income areas, providers are even less able to cross-subsidise free hours with fees, so there is a disproportionate loss of places in those areas. The poorest families are ineligible for the free 30 hours, and those families who are eligible face barriers to participation.

This is a hugely important debate, and I congratulate the hon. Member on securing it. In Scotland, we have the same issue in deprived areas. Recent figures uncovered by the Liberal Democrats show that only 43% of families who are entitled to the free childcare for two-year-olds are taking it up, specifically because of the problems she mentions. Should we be doing more to make families aware of the support available to them and of how they can get it, as well as improving that support?

The hon. Member makes an excellent point and anticipates what I was going to say. The provision for two-year-olds, which is specifically there for the most disadvantaged, is complex and difficult to apply for, so it is underused. The families who need it most are not getting it, so I thank the hon. Member for that point.

There is a simple problem here. For some families, having childcare is the difference between being able to work or not. What should those families do with a child that is perhaps between the ages of six months and two years when there is no support at all? A six-month-old baby could be left in a cupboard at work, I guess, if that is the logic behind this. By the time they are one year old and they are crawling and walking around, that is not feasible, yet the subsidies kick in only at two years old. It makes no sense at all.

My hon. Friend is absolutely right. I could not take my babies around to meetings and so on after about four months. At that point, I needed either not to attend and not to go to work or to make sure that they had childcare.

Research in this week’s Guardian shows that there are fewer places in less affluent parts of the country. The settings are also more likely to be lower quality.

If I might add to my hon. Friend’s point, one woman wrote to me saying that she is a high earner and that when she got pregnant she worked out she could just about afford to go back to work—until she discovered she was expecting twins. Because of the cost between six months and the two or three years when funded provision comes in, which would help her a bit, she was in a desperate state.

The cost to parents and providers is rising, the funding for the free entitlement does not cover providers’ costs, and the current system of Government support is complex and leaves many gaps. There is also a quality gap affecting less well-off areas and poorer families. This crisis has been fuelled by 13 long years of this Government not acting. Before I finish, I want to ask the Minister a few questions.

The hon. Lady is making a good speech and some fair points, particularly about the difficulty people from poorer backgrounds have in accessing childcare. If we look at costs internationally, the cost of childcare in the UK is among the highest—if not, the highest—in Europe and by many international comparators. The Government often talk about wanting to get people economically active and back into work, but unless we sort this issue out and people are properly supported to have access to childcare, many people will not be able to afford to work and may have to forgo their careers to take the most economically viable option: looking after their children at home.

Yes. The hon. Member makes an excellent point. Depending on how it is measured, the UK has the third highest or the highest childcare costs to parents in the OECD countries. I ask the Department and the Treasury to look at how and why different Governments do things differently. In particular, the Canadian Government have recognised the economic benefit of properly organised and funded childcare.

Here are my questions to the Minister. Do the Government understand the importance of good-quality, affordable childcare? Do they know the difference it makes to education outcomes, women remaining in the workforce, inequality, the cost of living and the economy? We are not sure whether the Government are considering extending the free childcare option to one and two-year-olds, so we look forward to hearing what the Minister says on that. If they do, will that scheme and the current ones be adequately funded to cover the cost of provision? Will any extension include funding the reopening of settings that have closed and reskilling the workforce, as the current staff and managers will have moved on to other jobs, as they are already doing?

In conclusion, it is clear that the childcare system is broken. For many parents, the current provision is neither affordable nor available. The Government do not always like international comparisons, but they have to be made. I look forward to hearing from my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), who I know will set out in further detail the difference a Labour Government will make. We desperately need a change, because the current system is broken, and parents, providers and children are having to live with the consequences. Back in November, more than 15,000 people took part in the “March of the Mummies”. Surely they should not have to march again this November. Surely we can see some action, rather than yet more dither and delay.

I remind hon. Members that they should bob if they wish to be called. I call Justin Tomlinson.