Tory pledge re-affirms 30 hours of weekly childcare and funding review

Wednesday, April 22, 2015

The battle over childcare has intensified between the Conservative and Labour parties as the election draws near.

Prime Minister David Cameron today re-announced the party’s policy to give three- and four-year-olds of working families 30 hours of free childcare a week from 2017.

It follows the launch of the party’s manifesto last week.

The 30 hours of childcare would be paid for by restricting pension tax relief for people with incomes of over £150,0000 per year.

However, the Labour party has claimed that the Conservatives’ figures do not add up.

Speaking today in Bedfordshire, Mr Cameron said the policy would provide over 600,000 extra free childcare places for families every year.

‘In the next Parliament we will double the free childcare hours to 30 a week, worth £5,000 to working families,' he said.

‘That means over 600,000 extra free childcare places available for families every year, and parents able to work an extra 78 days a year without any childcare costs, all by 2017.’

Earlier today, the childcare minister Sam Gyimah tweeted to say the Conservatives would also review the hourly funding rates paid to providers.


However, Labour, which is proposing to offer all three- and four-year-olds 25 hours of free childcare a week, has argued that the Conservatives’ policy is underfunded by nearly £600 million.

It calculated that based on the Tories' own figures there would be a shortfall of £1,900 a year per place.

Tristram Hunt, Labour’s Shadow Education Secretary said, 'This is yet another sign of a desperate Tory campaign in chaos, with nothing to offer working people. The Tories announced this last week only for it to quickly become apparent there was a £600 million hole in their plans. A week later they're trying again and still they haven't got a clue where the money is coming from. Far from shedding any light on the issue, today has seen their policy unravel even further.
'Labour has a better plan for working people. We have a fully funded and costed policy which will deliver a real increase in childcare for working people.'

According to the Conservatives, restricting pension tax relief would raise £1.4 billion per year. But Labour says the party has already allocated this money to fund a reduction in inheritance tax for those with properties worth £2 million.

Labour claims that after taking this into account, just under £350 million would be left to fund the free childcare hours.

It says this falls well short of the £1.2 billion it would cost to fund the 30 hours of free childcare for three- and four-year-olds of working families.

Labour’s figures are based upon a scaled up calculation by the Conservatives’ that increasing the current number of hours from 15 to 25 a week would cost £800 million in 2015-16.

Meanwhile the Liberal Democrats said that the policy ignored the youngest children.

Liberal Democrat equalities minister Jo Swinson said, 'Tory plans for childcare ignore working families with the youngest children, which could leave some parents locked out of the labour market for years on end.'

Mr Cameron visited the Advantage Children's Day Nursery in Surbiton today with Mayor of London Boris Johnson.

National Day Nurseries Association research shows that 85 per cent of nurseries in England are making losses on the 15 hours per week of free childcare, an average of £809 per year for each funded child.

Chief executive Purnima Tanuku welcomed the Tory plans to increase and review funding rates and support pledged by all parties for more free hours of childcare for three- and four-year-olds.

'But whoever is in power, to deliver on their promises of more hours, it is incredibly important that nursery providers are funded properly to make it sustainable,' she said.

'We call on all parties to commit to increasing the hourly rate to avert the danger to childcare places and the sustainability of the sector in the long term and to commit to an urgent review of this funding system, which must engage with the nursery sector to make a real difference to the hourly rates they receive.'

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years, said, 'While we welcome an extension to funded free entitlement, many childcare professionals have struggled with cuts in local authority funding for free early education places, during the current administration, as well as reduced support and training from their local authority. This is why we are calling for a full funding review; without a guarantee of further support and investment, providers will struggle to deliver the high quality service that children deserve.'

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