Tag Archives: Childcare Bill

Queen’s Speech: not many promises, but plenty of challenges

By Richard Dunstan, Workflex blog editor

With the general election fast becoming a distant memory, new ministers have been appointed, the House of Commons has returned to life, and the Conservative majority government has set out its legislative plans for the first year of its five-year term. Yet, somewhat surprisingly, last week’s Queen’s Speech somehow failed even to mention the ‘hard-working families’ of which we heard so much – from politicians of all parties – during the election campaign, with even the Childcare Bill (see below) set to help “working people”. So, what can we expect the new Government to deliver in terms of ‘families and work’ policy over the next few years?

The short answer, judging by the Conservative manifesto and ministerial pronouncements to date, is ‘probably not a lot’. The manifesto was disappointingly short on policy pledges that might help ensure work actually works for all families, with no reference at all to flexible or ‘family-friendly’ working, or the need to increase the supply of good quality part-time jobs. In contrast to both the Labour and Liberal Democrat manifestos, there was no pledge of additional paternity leave, and no mention at all of shared parental leave. And there was nothing to suggest the new government will address the growing but largely unsupported role of grandparents in childcare.

To the surprise of some, the manifesto did of course pledge to increase the existing entitlement of free childcare for working parents of three- and four-year-olds in England, from 15 to 30 hours per week during term-time (i.e. 38 weeks per year). And, with the publication of the Childcare Bill this week, ministers are now suggesting that roll out of the increased entitlement will begin in September 2016, a “year earlier than planned”.

With costs having soared since 2010, and many parents struggling, more free childcare has to be welcome.  Indeed, as Giselle Cory of the IPPR think tank noted in the New Statesman last week, there is unlikely to be much political argument over the aim of the Bill: “childcare is a sound investment: fund it now and we’ll see the benefits for years to come, in rising levels of maternal employment, additional tax revenues, falling child poverty, and improved child development outcomes.” However, as Giselle further notes: “the rationale is simple; delivering the policy less so.” In the words of  The Economist magazine:

The [Bill] would make childcare cheaper for most families. But it would not address another problem: the shortage of places. In spite of a fast-growing population, the number of nursery places in Britain remained unchanged between 2006 and 2014, and has only just started to pick up. Growth has been stunted because nurseries are hard to run at a profit.

One reason is rising rents, particularly in London, which push up nurseries’ costs. And there is little that nurseries can cut back on: most of their employees already earn little more than the minimum wage.

But another reason is that the government underpays nurseries for the 15 hours a week that they must provide free of charge. The shortfall amounts to £800 per child per year. If the new 30-hour allowance is funded at the same miserly rate, the shortage of places could be exacerbated.

So it is welcome that the government has this week committed to “increase the average funding rates paid to providers (the hourly funding provided for each free place)”, with Department for Eduction minister Sam Gyimah set to oversee a review “before summer”, even if it is still far from clear how any increased rate would itself be funded. Ministers have so far committed only £350 million a year to fund the pledge, but the Pre-School Learning Alliance of private and voluntary providers argues this would leave a shortfall of £250m a year, on top of the existing annual shortfall of £100m. And it’s worth remembering that, as recently as December, Sam Gyimah was claiming that Labour’s  very similar but less ambitious promise to increase the free childcare allowance to just 25 hours per week would cost “at least £1.5 billion”.

Elsewhere in the Queen’s Speech, there was little cheer for struggling families – working or otherwise. The Full Employment & Welfare Bill will reduce the current household benefit cap from £26,000 to £23,000 per year, amid warnings that this could plunge 40,000 children into poverty. Ministers have yet to spell out where pledged cuts of £12 billion to the welfare budget will actually fall, with the well-respected Institute for Fiscal Studies warning that further cuts on such a scale will most likely either increase poverty or undermine the Full Employment & Welfare Bill’s aim to “ensure that it pays to work” by weakening work incentives. And the Enterprise Bill’s principal aim of “cutting red tape and saving businesses at least £10 billion [by 2020]” seems to offer little hope any progressive reform of maternity, paternity and shared parental leave, or of employment rights more generally.

In that context, it must be hoped that the publication – possibly later this month – by the Equality & Human Rights Commission of the findings of its £1 million programme of research into pregnancy and maternity discrimination at work, will at least prompt a ministerial rethink in relation to the prohibitively high employment tribunal fees introduced in July 2013. For all the indications are that the Commission will report such unlawful discrimination to be more common in Britain’s workplaces than ever before.

All in all, this means there remains a lot of work to do in convincing ministers of the benefits of making work work for all. Together with our partner organisations – such as the Family & Childcare Trust, Gingerbread, the Fawcett Society, NCT, and the TUC – we at Working Families will be working hard to promote the benefits of tackling low pay (including the disturbingly low rate of statutory maternity, paternity and shared parental leave pay), adopting a ‘flexible by default’ approach to job design and recruitment, extending paternity leave, and creating a new right to a period of ‘adjustment leave’ to enable families to weather a ‘life shock’ without giving up work.

We will press ministers to conduct their long-promised review of employment tribunal fees, and to consider whether further governmental action is necessary to tackle zero-hours contracts and other forms of ‘casualisation’ in the labour market – an issue highlighted in the most recent annual report of our legal advice team. And we will work to ensure that the Childcare Bill addresses the particularly acute childcare crunch faced by parents of disabled and special needs children.

 

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