Funded Childcare

(Urgent Question): To ask the Secretary of State for Education if she will make a statement on her Department’s plans to roll out 15 hours of funded childcare to 2-year-olds in working families from April 2024.

The Government are rolling out the single largest expansion in childcare in English history. By September 2025, we will provide working parents with 30 hours of free childcare a week from when their child is nine months old, all the way until they start school. By 2027-28, this Government expect to spend in excess of £8 billion every year on free hours in early education—double the amount we are currently spending.

We are introducing that in phases. From April, eligible working parents will be able to access the first 15 hours of free childcare each week for their two-year-olds. In September, they will be able to access the first 15 hours each week for nine-month-olds. A year later in September 2025, they will be able to access the full 30 hours for all eligible children aged nine months upwards.

We want parents to be able to access the new offer as soon as they can. Delivering that ambition includes increasing childcare funding rates, with an additional £204 million in this financial year and an additional £400 million in the coming financial year. We are providing grants to help new childminders enter the sector and, to make it easier for the sector, making changes to the early years foundation stage that it has asked us to make.

We hear every day from families how significant this policy will be for their finances. Once the roll-out is completed, eligible families will save up to £6,500 per year. It will help parents to return to work or increase their hours, and tens of thousands of parents have already successfully applied for their codes, ready to take up their places in April. Parents should visit childcarechoices.gov.uk to see the full range of support they are entitled to.

Regarding tax-free childcare, we will be issuing letters with temporary codes to any parents whose tax-free childcare reconfirmation date falls on or after 15 February and before 1 April. That will ensure that any eligible parent who needs a code to confirm their funded childcare place with their provider will have one, and that no parent should worry that they will lose out.

I welcome this opportunity to correct some misleading stories about the childcare roll-out, and to hear from the hon. Member for Houghton and Sunderland South (Bridget Phillipson) about whether she supports our childcare policies, and, if not, what her childcare policies would be. I am sure Members on the Labour Benches would like to know as much as we would.

In which case, it would have been good to have come forward with a statement, rather than me granting an urgent question. So, please bear that in mind before you make a comment.

Thank you, Mr Speaker, and thank you for granting the urgent question.

Crumbling school buildings, botched school budgets and now the hat trick: a childcare pledge in tatters because of Conservative bungling. It is not Ministers, but families across the country paying the price for Tory incompetence. How did we get here?

A litany of failures: a pledge without a plan and a Department without a grip, led by Ministers without a clue; families without the certainty of a childcare place they were promised by the Chancellor last March; and meanwhile the Department is facing a further £120 million shortfall because of yet another miscalculation. How are they going to make up that shortfall?

Families are facing a rolling wave of Conservative chaos which wrecks all before it: for providers it is an utter fiasco, where their income after April is still a state secret. When will providers be told about their funding rates? How many families does the Minister estimate will now not be able to access new hours because of this shambles? The Prime Minister’s official spokesman this morning said:

“We are confident that the provision and capability is there, we are confident in the strength of the marketplace.”

But the market is telling them that their plan is simply not deliverable. The chief executive of the Early Years Alliance said that signing up to the new system was “financial suicide” for providers. Mr Speaker, this is not a market, it is an almighty mess and Ministers know it. Government sources are briefing the papers that there will be

“parents that just don’t get their places.”

Let me explain to Ministers in words of one syllable. That is no good. That will not work. They must do more. They need to fix it. If providers cannot price places now, how on earth can they be expected to offer more in September? Can Ministers guarantee to parents now that the roll-out will be delivered on time, yes or no?

I will try to pick out the questions from the bluster.

On the £120 million, this is a specific issue that affects September 2024 onwards, where we allocated to local authorities 22 weeks of funding because that is the period from September to March. Some then said that they pay 26 weeks to their providers, so we have that money in order that they can provide 26 weeks of funding where that is what they do.

On the funding rates, we announced the funding rates for three and four-year-olds in April last year, and for two-year-olds in November.[Official Report, 30 January 2024, Vol. 744, c. 9MC.] Given that local authorities have to pass on 95% of the money that we give them, providers have a pretty good idea of what they will receive. However, while the vast majority of authorities will confirm their rates in the coming weeks, a small number leave it until 31 March. We are encouraging them not to do that, and to confirm their rates as early as possible in the same way as the others.

The hon. Lady asked how many families would not be able to access the childcare offer as a result of those two issues. The answer is none. As she knows, we have increased funding rates significantly. Neil Leitch, to whom she referred, is in our stakeholder group, and we value his input. However, I think it will be clear to people watching these exchanges that while we get on with the biggest delivery of childcare ever, the Labour party has no plan, no policy, and no idea how to help families with childcare costs.

The expansion of childcare is extremely welcome, and I have every confidence that the Minister and the excellent team at the Department for Education will deliver this current expansion on time and that the funding will reach all the families who need it. To be fair, however, the Minister is dealing with a system that has become remarkably complicated over the last 15 or 20 years. Would he be interested in discussing with the Chancellor the notion of rolling up all the various funding streams that we provide for childcare, and indeed for family support, and instead of taking money from people in taxes, losing some of the administration and returning it to them in the form of mandated childcare, thus giving every family with children a generous tax break to allow them to make choices for themselves?

My right hon. Friend has written some articles, which I have read, proposing that very idea. We think that our present system is the best way of achieving what we want to achieve, but I am of course happy to continue my discussions with him.

Good-quality childcare is a crucial economic infrastructure issue for parents now and the education of children in the future, which is why we need it, but the system is too complex, and we cannot access it in my constituency. Providers are collapsing. When will the Government think about drawing up a workforce plan to try to stabilise the system before adding more and more complexity for parents?

I am not sure what the hon. Lady means when she says that people in Bristol cannot access the system, but if she sends me the details, I shall be happy at look at them, because, I have said, tens of thousands of parents have already accessed it. I should also point out that while there has been a fall in the number of providers, there has been an increase in the numbers of both staff and places, so we are confident that we will deliver the roll-out as planned.

I welcome the Minister’s statement, and working parents across my constituency welcome this expansion and the biggest ever investment in childcare in England. Today, however, I received a letter from Victoria Morris, a very experienced childminder who has worked in Leigh-on-Sea for more than 20 years, pointing out that someone who owns a nursery can claim the funding for children to whom they are related, including their own children, but that does not apply to childminders. She simply asks whether the Minister would consider lifting that ban so that childminders are on the same footing as other childcare providers.

The current legislation states that people cannot access Government money for looking after their own children, although it can happen in a larger setting. We have no plans to change that at present, but I should be happy to have a discussion with my hon. Friend.

We know of the challenge that many parents face in trying to find an appropriate nursery for their children, but it is even harder when a child has special educational needs. According to messages I have received, some nurseries are refusing to take such children on. Can the Minister say without equivocation that that is unlawful?

The hon. Gentleman has made an important point, and he is entirely right. We have heard from great organisations such as Dingley’s Promise that providers have not given places to children with special educational needs, and the team and I are looking into that to ensure that it is not the case.

Parents asked for support with childcare and the Treasury and the Government have delivered it, but the system does need to be simplified. I have been following the analysis of the codes, and receiving the codes, by Pregnant Then Screwed, which announced today that a fix had been found and thanked the Department. It would be helpful to hear a little more about that. Will my hon. Friend meet, for instance, the New Deal for Parents group, which is looking for long-term simplifications? Will he also tell us how he is working through the different local authority areas to show that there will be places available now and also in September, because so many parents are looking forward to that?

My hon. Friend has been campaigning on this issue since she arrived in this place. The tax-free childcare code issue was a specific issue caused by parents needing to reconfirm their eligibility every three months to prove that they were still eligible. If they did that quite late last year, they were concerned that they might not be able to get the place they needed in time for the 31 March deadline. As my hon. Friend says, Pregnant Then Screwed has fixed that issue. I would be happy to meet the groups that she mentioned. On the sufficiency of places, we are in monthly contact with local authorities to ensure that they have sufficient places, and only a very small number are reporting any concerns at this point.

A report from the Early Education and Childcare Coalition last November found that only 17% of nursery managers said they could offer the extended entitlement, because of the crisis in recruitment in the sector, and 35% said they would limit the number of places they offered unless the Government helped with recruitment. More than half of all nursery workers have said they are planning on leaving the sector in the next 12 months. What will the Minister do to address the crisis in recruitment and retention in the sector so that nurseries can provide the extended entitlement that parents want?

We have seen a 4% increase in the number of staff in 2023, compared with 2022. None the less, part of the reason why this is a phased implementation and expansion of childcare is to ensure that we have the number of staff we need, and in a couple of weeks we will be launching a big recruitment campaign to get more people into the sector.