Sharon Hodgson MP

Working hard for Washington and Sunderland West.

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Speech to Daycare Trust conference 16.11.10

Sharon was asked to deliver a speech to the annual Daycare Trust conference at One Great George Street, Westminster, on the future of childcare in the UK.



Good afternoon.

I think I should probably start this speech by saying 'sorry' - sorry I'm not Andy Burnham.

I know many of you were expecting that he would be coming to talk to you today, and were looking forward to admiring

He sends his apologies.

I'm sorry also that I haven't been able to be around for the rest of the day - looking down the list of speakers I see you've had some very distinguished guests up here today.

Oh, and Sarah Teather too.

I was particularly impressed to see Dr John Bennett on that list - I'm sure he gave you a fascinating international perspective on the state of childcare in the UK.

I'm sure also that Mike Brewer gave you some quite challenging insights into the economics of childcare provision - and how it can be paid for.

I just caught the end of Kate's session, so I know you enjoyed that. Kate has a fantastic reputation in the Labour Party, as does Catherine McDonald.

So it's an illustrious list of speakers you've had before you today, and I'm very pleased to be part of it and giving my first major speech in my new role as Shadow Children and Families Minister.

I've only been doing the job for a few weeks now, and there's a big difference from lobbying people like Ed Miliband and Ed Balls on my key campaigns, to trying to get on top of a whole brief and having others lobbying me on theirs, but I'm enjoying it greatly.

My life could have taken a very different route - I myself was once a registered childminder.

As those of you who I've met before will know, there really isn't any other brief which suits my passions quite as closely as working to improve services for children, and I'm very much looking forward to meeting those of you in the sector who want to contribute to helping shape Labour's vision in this area.


I've been asked to talk to you today about securing the future of childcare, but I think it would be impossible to talk about the future without first addressing the present, and how we have arrived at it.

There were, and remain, two guiding principles in Labour's approach to early years.

One was the acknowledgement that without good quality, affordable childcare, as well as significant help to access it, women would continue to face significant barriers to the job market.

And at a time when the economy was doing as well as it was in the decade preceding the near-collapse of the global financial system, a country like the UK simply could not afford to miss out on the skills and hard work of many women who would have potentially had to stay at home if there wasn't consistent access to good quality childcare.

But above that utilitarian approach is the commitment to equality - ensuring that women not only have the right to work, but also the practical and financial support to actually allow them to do it.

The second principle was that every child should have the best possible start in life if they are to realise their innate potential.

For too long, it has been the postcode of where you grew up rather than that potential which determined how far you could go in life. A desire to change this is why I and many of my colleagues got in to politics in the first place.

It's not just for the sake of individual children that we put so much into lifting millions of them out of poverty, improving early years provision and financial support for childcare costs, to name but a few measures.

It was because we know that allowing and encouraging children from all backgrounds to reach their potential is vital to the long term economic prosperity and success of the country, not only through greater productivity but also through having less people dependent on state support.

The money that has been spent on children is a direct investment in the future of the UK - the benefits may not yet be apparent, but before long it will bear fruit.

So what have we achieved over the last 13 years to this end?

We introduced free nursery places for all 3 and 4 year olds. 95% of children and their families now benefit from this entitlement.

We introduced a targeted offer of 10-15 hours free early learning for the 15% most disadvantaged two year olds across all local authorities, the first part of our commitment to provide universal free childcare for this age group as well.

We opened over three and a half thousand Sure Start Children's Centres offering learning and health support to more than 2.7 million young children and their parents.

We have over 20,000 schools providing access to the full core offer of childcare, extra curricular activities and other specialist support, helping parents manage work and childcare.

We were giving £3.8m a day directly to working parents to help with childcare costs, which in turn provided a real stimulus to the sector.

We introduced national frameworks and standards to ensure that early years provision is consistently of a high quality, and adequately prepares children for starting school at 5 years old

We ensured that local authorities, Jobcentres and Primary Care Trusts worked together to provide and enhance the services offered to young children and their parents through outlets like chilldren's centres.    


So that's where we are at the moment, but where will we be in 5 years' time?

The future of Sure Start Children's Centres is one of my gravest concerns at the moment, and I'm sure those concerns are shared by many of you here.

There was so much spin in George Osborne's statement on the Spending Review, there's no wonder he was having to grip the Despatch Box so tightly.

There was even a point where he claimed credit for increasing the entitlement to 15 hours, as if the last three years of pilots had never happened and it was entirely the coalition's idea.

On Sure Start, a casual observer could be forgiven for thinking that he had valiantly rescued it from the jaws of financial catastrophe, but as you know, this couldn't be further from the truth.

He said he has protected Sure Start funding, but what he has actually done is cut funding in real terms - according to the FT the cumulative effect of this by the end of the spending review period is a reduction in revenue of 9%.

I think that is too cautious, and the real rate will be around 15%.

But that is just the start - then the army of new health visitors have to be paid for.

Now I don't think that having more health visitors is a bad thing at all, and linking them with children's centres will no doubt have a positive effect on health outcomes for children in deprived areas. 

But saying that they should be paid for out of an already relatively small, and shrinking, pot is worrying.

After all, they'll have to come from the NHS - you can only get the training to become a health visitor after working as a nurse or midwife for a couple of years.

So will 4,200 more health visitors mean 4,200 fewer nurses and midwives, or will the NHS have to recruit 4,200 more people?

Either way, that's not going to be cheap. The cost of paying all those health visitors alone will easily top £100m, and with all the other costs of employing them, such as training, pensions, payroll management, mileage, uniforms, materials etc etc, you're looking at a minimum of another £150m, or 17%, coming out of the sure start revenue budget.

So already, funding for the functions children's centres perform now has been cut by over a third.

And even though that places a massive squeeze on local budgets, we also now know that they could be reduced still further by cash-strapped local authorities taking advantage of the removal of the ring fence to plaster budgetary cracks elsewhere.

In fact, those cracks don't even have to be budgetary - there is literally nothing now stopping local authorities, who are taking the brunt of cuts, taking money away from sure start to fix up the town hall, or fill in some potholes.

I put these points to Sarah Teather yesterday at Education Questions, and I asked her to promise me that the decisions they have taken would not lead to any children's centres closing.

She could not give me that guarantee - effectively passing the buck on to local authorities.

The Conservatives always used to say that the Labour government introduced 'stealth taxes' - I couldn't possibly agree obviously, but it certainly seems true that Osborne and his colleagues like the idea of stealth cuts, especially if they can get away with forcing someone else to make them.

Ministers keep making references to 'refocussing' Sure Start on those who need it the most. Sure Start funding is already focussed more keenly on deprived areas, so I'm not entirely sure what they mean by this. One thing I do know is that every time I hear them say it I worry that can only mean that they plan to exclude people.

In an interview in the Observer just this weekend the Minister of State announced several major policy shifts, one being allowing children's centres to charge some parents for some services.

She uses the example of 'baby yoga', presumably to make it sound like centres are tailoring their services towards middle class mums.

She says that children's centres will keep their 'universal front door' - this is a meaningless pledge if when you walk through that door you go into one room if you can pay, and another if you can't.

The wonderful thing about sure start is that it brings together parents and children from different backgrounds who might otherwise never have come into contact - it's a hub which can knit together the entire community, which is exactly why they have been so successful.

Quite how someone like Sarah Teather, who I honestly believe does care about children, can not only stomach this attack on Sure Start but also defend it is, I'm afraid, beyond my understanding.

She also says she wants to see children's centres paid by results - not necessarily a bad thing, until you consider that 9 times out of 10 improving results will need up-front investment, and that we have no real way of measuring the results of an informal service like children's centres.

Assuming we had, we would then need assessors, presumably in Whitehall, and presumably paid for out of the Sure Start budget, reducing it still further.

On top of this there will also be a requirement in the Decentralisation and Localism Bill for local authorities to put contracts for running children's centres out to tender if local groups express an interest.

Again, the tendering process will divert more money away from front-line services, and not necessarily result in an improvement in services. In fact, moving away from local authority provision risks the loss of services if these groups find they can't run centres with the newly reduced budgets they'll have to work with.

Of course, there are a number of very successful centres being run by charities, and letting more be run in that way was part of our future plans as well.

But to say to local authorities that they have to relinquish control if someone else wants to run it shifts the emphasis from ensuring the quality of the provision to fulfilling David Cameron's vision of the Big Society for its own sake.

Collectively, we need to press the government to ensure that contracting out of Sure Start is only ever done to improve services, not to reduce costs, and certainly not as part of an ideological drive to shrink the size of the state.

I've been hearing a number of things about what the Minister has said to you this morning, and I am disappointed.

It's not just the fact that things like scrapping public bodies and altering legislation should really be made first to Parliament, it's the nature of the announcements too.

First, the Children's Workforce Development Council. The reason they were made a public body in the first place is that they could do the job of improving skills and capabilities across the children's workforce much better than Government could.

Now their functions are being transferred back to the Department, with no guarantee of sustained funding, the future of professional development within the early years sector looks very uncertain.

This is compounded by the decision to abolish the requirement for daycare settings to employ people with both Qualified Teacher and Early Years Professional status.

Many settings who are struggling for funding will just say - OK, great, we can let these staff go. But that does not improve the quality of care that children are receiving, and it means people who are considering getting these qualifications and building their career in early years will be left wondering 'what's the point?'

It is improving the quality of care, not reducing cost, that should be the primary goal of the government.

I've also read in the last few hours that the Minister announced that Children's Centres in deprived areas would not be required to provide full time childcare.

Apparently this is to ensure that resources are focussed on the neediest, and that it is currently taking resources away from the front line

To me this sounds crazy - in those areas, children's centres are often the only provider of good quality childcare, and if they start reducing the hours they provide, how can parents, who are being told to get out and get jobs, take one if they can't have a guarantee that centres will be open for the whole of the working day?

Obviously this is the first I've heard of these plans, and I'll be pressing the Department for more details, but from where I'm standing these measures simply looks like a way of saving money, and have the potential to cause serious harm to the sector.

Financial help for childcare has also fallen foul of George Osborne's wildly swinging axe, with a reduction in the childcare element of Working Tax Credit from 80 to 70% of the cost.

This flies in the face of their claims that the budget was fair on working families - those who relied on it the most will have to find more than £1,500 a year extra from their already squeezed household budgets to maintain the level of childcare they need to go out and work.

For some parents, this will inevitably lead to the conclusion that they'd be better off staying at home.

This is in stark contrast to one of the government's favourite themes over the last couple of weeks - that they want to ensure that people are better off in work.

It is claimed that the planned reforms of the welfare system will get 1.6 million households out of worklessness, which is a laudable goal.

It does seem like Mr Duncan Smith wasn't paying attention when the Chancellor announced that there would be a million fewer jobs in the economy by the time Universal Credit comes into effect, though.

Leaving that aside, the Universal Credit White Paper doesn't give us very much detail to go on with regard to help with childcare.

Obviously the Working Tax Credit system will be no more, but none of us know how much support parents will get under the Universal Credit system or how it will be administered.

Their actions so far in cutting the childcare element rate don't fill me with much hope, and I notice that the White Paper doesn't include any pledge that support under the new system, however it is administered, won't leave parents any worse off.

That's something else we'll have to work together on further down the road.

Elsewhere, we have a review of the Early Years Foundation Stage.

Obviously, having just got to a stage where the majority of parents and providers were happy with the new system, and it is showing real signs of improving outcomes for children across the board, I don't think that such a wide-ranging review as has been promised is appropriate.

However, I do have confidence that Dame Tickell, if left to her own devices, will come up with some sensible suggestions to fine tune the existing system, rather than rip it up and start again.

As with all new policies, there will be areas where improvements can be made, efficiencies found, or elements clarified, and it is important that parents and providers have their concerns listened to and acted upon.

My main concern is if Nick Gibb tries to get involved - the last thing I think we in this room want is our toddlers being force fed King Lear instead of the Gruffalo!

Our vision

So I've had a bit of a moan about the terrible things the other side are doing - I am a politician after all.

But what I imagine you all want me to tell you is what would Labour be doing to secure the future of childcare.

Well, to a large extent, you already know what we would be doing - up until 6 months ago we were still doing it.

We started the revolution in early years provision that is now reaching maturity.

And although the economic problems the world has faced will mean that the need for better value for money is greater than ever, now is not the time to be withdrawing support for working families, or for improving the chances of those children from the poorest backgrounds.

In fact, that support is more important than ever if we are to avoid the kind of cycle of worklessness and poverty we have worked hard to break over the last 13 years.

As I said before, when we started the pilots for places for two year olds, we did so with the long term goal of moving towards universal free provision.

Not only would that create thousands of new jobs across the public, voluntary and independent sectors, it will also help hundreds of thousands of parents - mainly women - get back into employment quicker before.

And let me be clear - that provision should remain free.

Top-up fees should be avoided. It negates the very reason for us introducing the entitlement in the first place - to ensure that those in need of it take it up.

Everyone should have the chance to make use of a state-funded early years place, and top up fees would immediately put it beyond the reach of the hardest-pressed.

Where there are local problems with funding not meeting the cost of providing places, local authorities and providers in the private sector need to work much closer to find solutions.

As I said earlier, Sure Start funding must be protected, and it must be increased - even if only to keep up with the cost of providing it.

Allowing cash-strapped local authorities the option to dip in to the Sure Start pot will test the commitment of even those council leaders who are most squarely behind the aims of the project.

If the government were genuinely committed to the future of Sure Start, and genuinely wanted it to reach more children, they would not have removed the ring fence within six months of being in power, and there would be no question of them freezing funding and removing significant chunks of it to pay for health visitors.

We are genuinely committed to Sure Start. Sorting out any damage done to the network of Children's Centres will be one of our first priorities when we are back in Number 10.

The future of childcare is inextricably linked to the future of our economy, and government must acknowledge this. Without jobs for parents to go to, there is no need for thousands of paid places.

And without adequate childcare support for those with the opportunity to work to go and do so, the skills of thousands of parents will be lost to employers, and of course, even less revenue for providers.

For childcare to provide the long term benefits to society it has the potential to, it must be high quality, and it must be geared towards preparing children for starting their formal education.

The Early Years Foundation Stage is instrumental in this and must not be watered down - any changes to it must be limited to minor changes geared towards making the system clearer and more effective for providers and parents.

The Graduate Leader Fund is also instrumental in ensuring that all day care settings have a highly-qualified professional on their books, driving up performance of other staff and outcomes for children.

Although savings may have to be made, it is vital that it remains, and is not another pot from which local authorities can divert money to other areas.


I'm sure I haven't said anything here today you didn't already know.

As the stakeholders in early years, in whatever capacity, you will know better than most the challenges the sector is facing, but also the value of it in society.

You know that the availability of good quality childcare, and increasing the take up of it, is of vital importance both to our short term and long term economic prospects.

And I know that while we in the Labour Party can be proud of the legacy we have left, we also need to acknowledge that society continues to change, particularly with such a tumultuous economic backdrop.

As society changes, so do the needs of parents and children.

So we can never rest on our laurels, and we can never say that the job is done. We must continually strive to ensure that early years provision meets those needs.

We can only do that with your help.

Thank you for everything you have done so far, either as a parent, a professional, or a politician, and thank you for all that you will do in the future.

As I said at the beginning, I am very much looking forward to meeting with many of you here today and colleagues from around the country over the coming months and years, and I am keen to work with you on how we can move childcare forward together.

Thank you for very much for the opportunity to talk to you today, and I look forward to your questions.

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