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7 Mar 2003 : Column 1126—continued
2.28 pm
Roger Casale (Wimbledon): I am delighted, in the short time that remains to debate this important Bill, to follow the hon. Member for Eddisbury (Mr. O'Brien). I agree that it is a shame that, because of the time taken on a previous Bill, we have little time left on this occasion to debate it. I part company with him when he says that he is quite prepared, despite the shortness of time, not to have his Bill debated, especially as we debated the Bill last year, and we discovered a number of flaws in it. That in itself is an indication of why we need to continue that debate. If we do not have time to complete the debate today, I am sure that there will be future occasions on which the debate can take place.
My constituents are extremely concerned about the issue of food labelling. So far, however, I have had no letters from any of my constituents complaining about the existing regime. The issue is important to them and we must consider it. However, if a proposal is likely to lead to considerable administrative changes and inconvenience, we must make absolutely sure that we get the changes right. I do not—
It being half-past Two o'clock, the debate stood adjourned.
Debate to be resumed on Friday 14 March.
Remaining Private Members' Bills
PENSIONS (WINDING-UP) BILL
Order for Second Reading read.
To be read a Second time on Friday 21 March.
HEALTH AND SAFETY AT WORK (OFFENCES) BILL
Order read for resuming adjourned debate on Question [31 January], That the Bill be now read a Second time.
Debate to be resumed on Friday 4 April.
ANIMALS (ELECTRIC SHOCK COLLARS) BILL
Order for Second Reading read.
To be read a Second time on Friday 11 July.
CROWN EMPLOYMENT (NATIONALITY) BILL
Order for Second Reading read.
To be read a Second time on Friday 14 March.
National Child Care Strategy (London)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Ainger.]
2.31 pm
Ms Karen Buck (Regent's Park and Kensington, North): I am grateful for the opportunity to raise issues of grave local concern that have wider ramifications for child care strategy, particularly in London.
The importance of the early years agenda to the social and educational development of children, especially children from the most disadvantaged backgrounds, does not need to be restated. More can be lost or gained by tackling the impact of disadvantage between the ages of two and five than at virtually any other stage in life. Important, too, is the contribution that quality affordable child care can make to enable parents to enter the workplace.
Progress made under the auspices of the national child care strategy is to be warmly applauded. A great deal has been achieved in recent years, especially for three and four-year-olds, and in the overall expansion of after-school and holiday provision across the country. However, in the time available, I would like to focus on two closely related sets of concerns regarding early years services in London, and, in particular, in my two home boroughs of Kensington and Chelsea and Westminster.
The decisions now being taken by those councils—they are not isolated examples, because I understand that the London borough of Southwark is set on the same path—undermine the central objectives of the child care strategy. The situation is slightly complicated by the fact that elements of the child care strategy that are entirely sound in principle and work effectively in some parts of the country are less effective in London because of the combined impact of exceptionally high costs and complex demographics.
To take the most important illustration, if the child care tax credit reached a wider group of parents and was as capable of meeting the same proportion of costs in a mainstream community nursery in my constituency as it is in another equally deprived but cheaper part of the country, the situation could be different. That would not make right what I believe to be ill-judged and isolationist decisions by the councils, but there would be the potential—currently lacking—for ensuring that properly planned child care expansion works better than it is doing.
For the record, the sets of decisions that have led to where we are now are as follows. They are the proposed closure of two nursery schools—Maxilla and Ainsworth—by Kensington and Chelsea council; the withdrawal of Kensington and Chelsea council's subsidy to three community nurseries—Maxilla, Colville and Swinbrook; and reduced funding by Westminster city council to its pre-school learning alliance, its contracted play provider, Westminster Play Association, and a number of other grant-funded early-years projects. However, I am happy to say that, last night, Westminster council agreed to some offsetting additional funding to help with some of the cuts.
The package of cuts put forward by Kensington and Chelsea council two years after the deeply unpopular closure of the Ladbroke day nursery is virtually a
masterclass in how not to model an early years policy or a strategy for working with the community. That is odd, given that the council was given the highest performance rating only a few weeks ago.The package cuts across the model for integrated services set out in recently published guidance on new children's centres. The Maxilla nursery centre, which combines a nursery school and centre for the under-threes and provides extended care, is the prototype for the children's centres that the Government rightly want to develop across the most deprived wards. It offers nursery care and education under one roof and looks after new babies to five-year-olds, until the children enter school. The centre is complemented by drop-in and crèche facilities for parents. It also has the capacity to provide baby care, to which Kensington and Chelsea council has taken particular exception, and offers extended year and extended day provision, which is especially valuable for working parents. It takes a particular type of perversity to wreck the Maxilla integrated nursery centre when Government guidance on the promotion of children's centres is being issued, yet that is exactly what Kensington and Chelsea council is doing.
Alongside the proposed destruction of the Maxilla centre, the council intends to close a second nursery school, the Ainsworth. That is also a popular maintained school with scope for further development to offer extended day and extended year facilities as and when resources allow, but it is being sacrificed to save money. That decision also seems to run counter to the Government's preference for retaining maintained nursery schools, and I hope that the Minister clarifies that when she replies.
The removal of subsidy from three community nurseries—Maxilla, Swinbrook and Colville—will have two immediate effects and could cause longer-term destabilisation. Parents not currently attached to the labour market will be priced out of child care services in those nurseries, so polarising the general nursery user profile between relatively high-earning parents and those who are entitled to free places by virtue of social services need criteria. However, many parents are in the middle. Those who are attempting to rebuild their lives—perhaps after experiencing homelessness or other trauma, or because they are refugees engaged in study to convert the qualifications from their homeland for use in the United Kingdom—will lose out. Indeed, the removal of subsidy will even affect them while they are looking for a job to pay their child care fees.
Those parents who are working and entitled to the tax credit could face a shortfall not of the permissible amount—the 30 per cent. contribution anticipated by the rules—but of at least double what they receive from the credit. The child care tax credit assumes a maximum contribution of about £40 a week for one child, but the unsubsidised cost of a community nursery place is likely to exceed £200 a week, requiring a parental contribution of more than £100 a week, which is increasingly the case for nursery provision across inner London in particular. The incentive to join or remain in the labour market for lower-income working parents is not immediately obvious, yet we know from research carried out by the Department for Work and Pensions that there is a particular problem in London in respect of lone parents
who work and that affordable child care and exceptionally high housing costs lie at the heart of the problem.Before dealing with the wider implications of what is happening in North Kensington, I want to draw the Minister's attention to the fact that councillors for the majority Conservative group have explicitly and publicly stated that they want alternative sources of Government funding made available to the community nurseries to replace the subsidy that they are withdrawing. They expect the nurseries, all of which are sited in wards that are among the 20 per cent. most deprived in the country, to make up the shortfall from sources such as sure start, the neighbourhood nurseries initiative or even the new children's centre funding, while the council enjoys the benefit of retaining the subsidy.
Parents are understandably bewildered and upset. They see the new Government-funded programmes that are investing in their neighbourhoods offset by cuts in council grant. The nursery closures and cuts in existing provision take place alongside the opening of new neighbourhood nursery facilities. Those are welcome and excellent initiatives, but they, too, may run into similar funding difficulties when their revenue component tapers out, leaving them with unsubsidised charges that are likely to exceed hugely what can be offset by the child care tax credit.
I deliberately did not tie this debate to provision in Kensington and Westminster because, although the decisions on those local issues deserve to be challenged, some wider implications need to be addressed to close loopholes in the child care strategy. Before I close my remarks, therefore, I shall run through a few questions, some of which I hope the Minister will be able to respond to now and others, which are more detailed, that she could answer later.
In his covering letter informing me of the proposal to withdraw subsidy from three nurseries, Councillor Lightfoot, the executive member for social services in Kensington, stated:
- "You will be aware that the decision in relation to the community nurseries reflects the emphasis of government policy, which is on providing funding for childcare direct to parents via the tax credit rather than to local authorities."
How are we to address the problem of child care where the cost significantly exceeds the maximum allowable claim under the tax credit, as it does, especially in inner London? What can be done to tackle the exceptionally low take-up of the child care tax credit, again especially in inner London, where only 2 per cent. of parents who receive child benefit are receiving it? Is it appreciated that, in any event, a flat-rate subsidy effectively discriminates against areas of higher cost, which is only partly offset by higher wages?
Is the Minister satisfied with the way in which local councils have funded children's information services, run by their early years partnerships but funded via an element in the local authority grant settlement? Those partnerships are likely to be at the forefront of take-up campaigns on the tax credit. Is the Minister satisfied that
all that funding is being handed over, because that has certainly not been the case in the London borough of Westminster? Will she do what she can to make sure that local authorities are at the forefront of take-up campaigns on the child tax credit and its child care component?Is the Minister aware of the exceptionally high capital costs that affect nurseries in London, feeding through into the much higher charges levied on parents? The capital allocation for the neighbourhood nurseries initiative did not recognise the cost of building in central London, and many sources of capital were already committed when the initiative was announced. If councils do not give sufficient priority to child care, it is exceptionally hard to make it sustainable. Without additional capital, Westminster's neighbourhood nurseries initiative could easily collapse. What provision can be made to assist with London's exceptional capital costs?
The questions that I have raised on capital and revenue costs need to be seen not only in the context of what is happening in Kensington but in light of the Daycare Trust's latest child care costs survey, which found that the typical cost of a nursery place in London is already £149 a week, which is £17 above the maximum set for the tax credit. What guidance are the Government giving to ensure that existing services are not lost to the community, and in particular, are not closed as a result of cuts in discretionary expenditure by local authorities? Is it acceptable for a local authority to seek directly to replace its own funding with Government funding linked to tackling disadvantage? Does the Minister believe that it makes sense for a local authority to close two popular nursery schools, as in Kensington, while overseeing the building of a new nursery under the neighbourhood nurseries initiative within walking distance?
Is the Minister aware of the susceptibility of discretionary early years services, such as play and playgroup provision, to cuts imposed by local authorities, and if so, what can be done to protect them? In Westminster, the recent grants round saw a 25 per cent. reduction in funding for the pre-school learning alliance, which has already led to many parents withdrawing their children. Within a few weeks, 72 parents have lost places as playgroups have closed and the effect of fee increases has bitten. Before the fees for after-school play services were negotiated down by parental and political pressure, they threatened to jump to around £400 a year, which for an unemployed family is an unrealistic charge.
Does the Minister accept that there is a problem with funding services for under-fives, holidays and after school that are provided to unwaged families, especially in disadvantaged areas? A modest charge for such services is not unreasonable, especially for working parents, and even more so when such charges can be offset by income from the tax credit for lower earners, but surely there is a real risk that the children whom we most want to benefit may be priced out when their parents only get by on income support or a comparable income. Obviously, there is scope for some funding to be put into services in sure start areas, but that does not always seem to work in practice. In any event, as we
know, many low-income and unemployed parents live just outside the wards that fall into the category of 20 per cent. most deprived, but are themselves families in need. The ability to offset funding problems with sure start resources therefore does not exist.Kensington and Chelsea council intends to proceed, as I have said, with plans to close two nursery schools and replace them with nursery classes. Research confirms that nursery schools provide higher quality and better outcomes than nursery classes, which is of great importance to parents and communities in areas of deprivation and social stress. Can the Minister clarify the Government's position on closure proposals for maintained nursery schools, especially in areas of deprivation?
The national child care strategy has brought both resources and a proper focus to the vital early years, which is important both for the sake of the children and in underpinning an employment strategy for parents. The national child care strategy is being seriously undermined in parts of London such as Kensington by blinkered policy making. Moreover, there is an urgent need to accept the impact of London's needs and costs on service provision. The range of child care services for people not currently in work is being squeezed hard, and that will hit our neediest children hardest. The working families tax credit is not reaching enough working parents on lower incomes, and may have a structural weakness that prevents it from doing so in high-cost areas. Child care costs, particularly in inner London, are so high that the child care tax credit is not plugging the gap.
I hope that the Government will help me and above all local parents to stop Kensington and Chelsea council destroying its excellent child care facilities. I also hope that we can find solutions to some of the wider problems facing us in our attempts to deliver top-class child care to our children.
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