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2 Nov 2004 : Column 53WH—continued
Child Care (London)
4.10 pm
Ms Karen Buck (Regent's Park and Kensington, North) (Lab): I am grateful to have the opportunity to begin to make a contribution on this important subject.
It is important to start by paying tribute to the national child care strategy and what has been achieved since 1997 with its contribution to the improvement of educational attainment and the reduction of child poverty. Those achievements are visible in my constituency, where we have four Sure Start programmes, several children's centres moving forward with the first approval of their implementation plans, two new neighbourhood nurseries opening in March next year and a number of neighbourhood nurseries initiative-funded places.
Those developments did not happen by accident, and we have had to confront Conservative-controlled councils and, in other areas, Liberal Democrat-controlled councils, which, by attempting to close nurseries, cutting voluntary service provision and reducing subsidies, have undermined what we have tried to do with Government money. It has left the Government, the London Development Agency and the Greater London authority having to plug gaps in local authority provision, and we have not been able to concentrate on building additional services.
Despite those hindrances, we stand on the brink of a new era for child care. The Government are doing nothing less than constructing a new plank of the welfare state, and we are doing so with hard evidence to support the value of the investment, whether in educational terms, as set out in the effectiveness of pre-school education study, or in economic terms, as costed by the latest PricewaterhouseCoopers study.
As well as Government investment, we are fortunate, too, in having the solid support of the Mayor of London and the Greater London authority, the London Development Agency and Association of London Government, for which child care is a priority. However, despite the achievements, vision and investment, very welcome though they are, we must recognise that the whole child care strategy is not delivering in London to the same extent as in other parts of the country. Unless we make some fundamental variations in the 10-year strategy, we will continue to lag behind in the delivery of all the benefits that child care investment can bring.
The key points are in the figures. London has the highest rate of child poverty in the country, with 38 per cent. of children living in poverty; and the figure is 53 per cent., after housing costs, in inner London. Women with children in London face a more severe employment penalty than those elsewhere. The employment rate for women without children is only slightly lower in London than elsewhere in the United Kingdom, but for women with dependent children, employment rates are substantially different. There is a 12 per cent. difference, with 53 per cent. in employment outside London, compared with 65 per cent. in London.
Many parents would prefer to work part-time while their children are very young, but opportunities for this are more limited in London than elsewhere. Nationally,
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37 per cent. of women with children are working part-time; in London the figure is only 26 per cent. Parents in London are paying more for child care and they need to pay for more hours of child care, because part-time provision is less likely to be available. The average cost of a full-time day nursery place in London for a child over two years old is £148 a week—20 per cent. higher than the English average. Less than half of London's nurseries have fees for children aged two or over that fit in with the £135 ceiling for the child care element of working tax credit.
The Government explicitly recognise that problem in the Cabinet Office strategy unit report on London. The report, published in July, says that:
in London, with the higher cost of child care not being reflected in the tax credit system. The report calculates that a London parent with full tax credit entitlement would have to meet £73 a week of their child care costs.
4.15 pm
Sitting suspended for a Division in the House.
4.25 pm
Ms Buck : I was referring to the Government's Cabinet Office strategy unit report on London and the fact that it had made it clear that the higher costs of child care in the capital are not reflected in the tax credit system. It calculates that a London parent with full tax credit entitlement would have to meet £73 a week of their child care needs themselves, compared with £36 a week elsewhere in the country.
The report also acknowledges that tax credits do not provide support for more than two children and that that disproportionately affects some minority ethnic groups, along with others who have larger families. Figures cited in the report show that 28 per cent. of lone parents in London declare themselves unable to afford child care at all and a further 13 per cent. are unable to find suitable child care.
Research by a new deal for lone parents pilot identified what it called the added logistics problem of organising child care. The report stated that
"the biggest issue for working mothers was planning and organising the triangular journey involved in leaving home, dropping off children at childcare providers and travelling to work at another location".
Underpinning those conclusions is the reality of unmet need for child care provision. The latest Ofsted figures appear to show child care provision in London falling behind the national average in terms of new places. The number of child minders is lower in London: 8.6 per cent. of under-fives have access to a child minder compared with 11.2 per cent. across England.
The problem of sustainability emerges in London in particular. The issue is at the heart of the affordability and cost dilemma and has been raised by people ranging
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from those involved with the neighbourhood nurseries initiative right through to those involved with voluntary organisations such as the Pre-School Learning Alliance.
The 10-year child care plan provides an opportunity to develop a vision of what we would like to see in London in 2015 in the key areas of child care and early years, and the related areas of employment and child poverty. We can and should congratulate the Government on what has been achieved so far, but it is precisely because of those achievements that we should not be afraid to look afresh at the scale of the challenge. The strategy must deal with the on-the-ground realities of London, offer a vision of the future and set out the steps that must be taken to turn the vision into reality.
First, the 10-year strategy needs to accommodate the reality of what will happen whatever we do. The most important example is population increase. The Greater London authority population projections show that London will have 87,000 more children under the age of five by 2015, compared with a 2001 base. London will account for the great bulk of growth in that age group at national level. We are therefore in real danger of being behind the curve in such areas as housing provision and pre-school place development. That must not be allowed to happen when it comes to working out the investment for additional child care places. In addition, London's child population will continue to become even more diverse over the period. Diversity need not correlate with poverty and unemployment, but it can easily do so if the right policy responses are not made.
Secondly, the strategy needs to accommodate our aspirations. Clearly, we hope that in 2015 London will be a much less unequal city for children, as the Government's child poverty strategy reduces income disparities. Child poverty in London will probably remain above the national average, but the national average could be far lower and the gaps could have narrowed considerably. Part of the process will involve a significant reduction in the scale of economic disparities between ethnic groups. Female employment rates in London will be far closer to the national average, if we get things right, as the employment outcomes of women with dependent children improve. The gender pay gap in London will have begun to reduce as women with children find it easier to maintain their career paths.
On the pressures that mobility and diversity can put on a city's social fabric, if we are ambitious and imaginative, it will be through children and parents, who all have in common a desire for the best for their children, that we can strengthen neighbourhoods and build social cohesion. However, for that vision to become reality we will need more parents in London to be in employment and the number of children in workless households to have fallen significantly. That will mean that the choices available to parents of young children will need to have improved. There will need to be greater flexibility in employment, improved parental leave and expanded child care and early-years provision. Benefits for those unable to work will also need to increase faster than median incomes, but increased employment will continue to be the main driver of poverty reduction.
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Children's centres will also need to be sufficiently real and comprehensive to provide a focus for neighbourhoods. The specific development in child care from the 10-year strategy for which we will be looking in London to help us to ensure that vision becomes reality are that every child under school age will have access to a children's centre, providing high-quality, flexible care and early-years education, and acting as a hub for high-quality child-minding services. The existing universal entitlement is 12 and a half hours' nursery education a week for three and four-year-olds. One option for children's centres will be to expand that universal entitlement and extend it to other age groups under five, to provide at least 20 hours of free care a week for all children, regardless of whether their parents are working. Parents who are working would then be able to purchase additional hours of care with fees based on ability to pay, meaning that parents could purchase the package of care that best suits their requirements in terms of hours and mix of provision in their area of residence.
The cost of providing child care services will have increased by 2015, but quality improvements will mean that that represents an improvement in value for money. However, the funding system will have to be reformed to ensure that large families are no longer penalised in terms of child care support. Funding should increasingly shift towards a subsidy to providers, given the inherent difficulties of varying a national flat-rate tax credit scheme to accommodate sharp regional variation. Alternatively, an expanded and more generous child care tax credit would ensure access for those on all income levels. There are various options for refining the tax credit, which I shall not go into in detail; they are thoroughly developed in representations that the Association of London Government, the Greater London authority and I have previously made to the Government. We have never been able to convince the Government of the need for a regional variation in the tax credit as a fundamental principle, so we will almost certainly need to focus predominantly on increasing the supply side for affordability.
We will expect providers to be part-funded to offer flexible services for younger children. Funding will be required to support the work force model, as labour costs will otherwise push costs above affordability thresholds. We look for funding recognition to be given to support providers, so that affordable options can be given to parents of under-threes who, whether through choice or as a result of unemployment, are out of the work force. Although it is reasonable not to provide full-time day care for such groups, it is not in the interests of the parent or the child, especially among more vulnerable parents and communities such as black and minority ethnic communities, to make child care so dependent on entry into the labour market that it is, to all intents and purposes, a cliff edge, and those not in work are unable to access any meaningful provision until their child turns three.
We will expect child care and early-years education increasingly to be delivered by highly qualified staff. The introduction of stable career progression will lead to far lower rates of staff turnover, and those entering the profession with no qualifications should have access to clear career progression paths. Rates of pay will increase
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in recognition of the improved skills base, and a London weighting system will ensure that children's centres are a viable career option for parents in the capital.
The expansion of the child care and early years work force will itself lead to a step change in the availability of flexible, locally based employment in London. If we get that right, the knock-on effect will be the gradual emergence of improvements in local economies, especially in some of our more deprived communities. A comprehensive programme of training provision through the learning and skills councils and the London Development Agency, coupled with an active local recruitment policy on the part of providers, will ensure that new opportunities are overwhelmingly taken up by local residents, many of whom will have previously been out of the labour market. New residential developments in London will incorporate child care and early-years facilities as essential social infrastructure as a matter of course.
There should be no embarrassment, and no defensiveness, on the part of the Departments—the Department for Education and Skills or the Treasury—as they have achieved so much, starting from such a low base in 1997. However, I fear that defensiveness might prevent us from accepting the fact that there is a substantial regional shortfall in the provision, and the scale of affordability, of child care. That is having a distinct effect in holding back employment opportunities for parents as a whole, and for lone parents and the most deprived in particular.
I hope that the 10-year strategy will not disappoint Londoners. Although we face a real challenge, if we do not meet it we will not meet our lone parent employment targets or our child poverty reduction targets across the country as a whole. Much will ride on the strategy. I hope that the Minister will respond as far as he can this afternoon, but I hope primarily for an assurance that my points will be taken seriously and that the 10-year strategy will give us a chance to deliver on some of them.
4.35 pm
The Minister for School Standards (Mr. David Miliband) : I congratulate my hon. Friend the Member for Regent's Park and Kensington, North (Ms Buck), not just on securing the debate but on the one-woman campaign that she has waged during the past seven years to ensure that the needs of Londoners in respect of child care, housing and employment are recognised in a suitable way. I congratulate her on the passion with which she addresses the issues and the facts and research that she uses to back up many of her arguments.
I hope that, on one score, I can disabuse my hon. Friend and the watching millions of the notion that there is any defensiveness on the part of the Government. My appearance testifies to the confidence with which the whole Department wants to address the issues. She will know that my right hon. Friend the Minister for Children, Young People and Families would have been here but for the fact that, as we speak, she is appearing on the Floor of the House. I hope that my hon. Friend does not take the presence of such a junior Minister as myself as a reflection of the issue's not being made a priority. Instead, I hope that she sees it as an example of joined-up government that the Minister for School Standards takes the issue seriously.
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I agree with my hon. Friend that the progress that has been made in developing a serious child care offer for children and parents is significant. I was struck, when examining the extensive research that was carried out for this debate, to see the investment that has gone on in London. To consider just one aspect of the child care offer, of 524 Sure Start programmes throughout the country, 96 are in London boroughs, with more than half of all London boroughs having more than three programmes.
The revenue grant for local programmes working with children under four and their families in the most disadvantaged areas in London alone totals nearly £150 million between 2004 and 2006. London Sure Start local programmes have been allocated higher levels of capital, perhaps reflecting some of the costing issues alluded to by my hon. Friend. More than £165 million of capital has been allocated through local programmes in children's centres, with a further £22.5 million allocated to neighbourhood nurseries in London. I agree with her that such investment, and the seriousness with which staffing and related issues have been taken in respect of under-fives and child care for youngsters over five but not yet independent adults is really significant.
My hon. Friend said that this is a new frontier for the welfare state, which is a good way of considering the challenge that faces us. The relationship between local and central Government, and our interventions to support families and the choices that they make about how to bring up their children, is an issue that has not been addressed in a holistic and serious way by the welfare state since 1945. She is right to say that that challenges the ingenuity and innovation of central and local government. If we are to extend security and opportunity, the child care offer should be at the heart of the welfare state.
In that context, the Chancellor's announcements in the Budget concerning the long-term commitment to funding for Sure Start—an extra £769 million between now and 2007–08—is significant and is a demonstration of the commitment the Government have and the voices we have listened to. Before I deal with my hon. Friend's point about the importance of recognising the regional dimension to the child care strategy, it is worth dwelling for a moment on two aspects of the 10-year strategy that she highlighted. First, there is a need to balance choice and investment—without investment, there is no choice. Although we have been proud of the fact that the pledge to deliver a nursery place for all three and four-year-olds has been delivered, it is up to parents whether they take account of that. She made the point that we have to deliver a range of provision in a range of settings if we are to meet the aspirations of all families. That is an important starting point.
My hon. Friend stressed the need to balance the demand and supply sides of the equation. Our investment has to go in on both sides. We must ensure that the investment is in the hands of families so that they are able to make their choices. That is the purpose of the tax credit system. Equally, we must ensure that the supply side—the range of provision and the staffing of that provision—is of sufficient quality that parents have the confidence to proceed.
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The whole Government are working on the 10-year child care strategy that provides the focus for this debate, and it might help my hon. Friend if I make a couple of points about how we are proceeding. We see four key principles at the heart of the strategy. First, the principle of early intervention is essential if we are to obtain the sort of change that we need—a radically improving universal and specialist service for those at risk. Secondly, parenting support needs to be allied to statutory services if we are to obtain the necessary provision. Thirdly, schools should be resources for a child care strategy, not somehow enemies of the strategy, operating separately from it. Fourthly, the range of professional expertise that exists in local government and in the voluntary sector needs to be deployed in the sort of multidisciplinary teams that my hon. Friend referred to. Those four principles will underlie the 10-year strategy as it is developed.
I do not want to repeat what some of my right hon. and hon. Friends have said about the development of the strategy, the commitment to use primary schools for 8 am to 6 pm child care, and the use of secondary schools as the basis for study support activities, because my hon. Friend will know about all that. However, she stressed the need to take account of regional and local variation in the development of the strategy. The important point that I want to make to her is that we are absolutely committed to doing that, and her contribution today will help us to do so. I hope that she takes some confidence—I was going to say solace, but confidence is
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more appropriate—from the fact that the Government have recognised the need to address some of the specific issues in London by setting up a specific project via the Prime Minister's strategy unit, which has tried to look at some of the issues.
We recognise that there are arguments about a "London effect" in a range of employment and other issues—notably cost, but also in other areas. It would be wrong for me to say that there is an easy answer, but the Government are clear that children and parents in London have as much right as children and parents anywhere else to a child care offer that lives up to their aspirations. The debate that my hon. Friend has helped to promote is certainly one that we want to engage in. On a previous occasion, she talked about the power of Sure Start in her constituency. I know of the North West Kensington and Golborne Sure Start programmes, and I am sure there are others. She has talked powerfully about the impact of those programmes on the life chances of young people, not just before the age of five but as they go through primary and secondary school.
The Government are as inspired as my hon. Friend about the progress that can be made by such strategic investment. We recognise that some of the challenges in London represent a significant hurdle for statutory and voluntary services and we want to deal with them. I assure her that I shall take the message of this debate to my right hon. Friend the Minister for Children, Young People and Families.
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