Free hours offer could 'keel over' without funding review

Earlier today the Prime Minister reiterated a pledge from the Conservative manifesto to double the number of funded hours from 15 to 30 hours a week for working parents from 2017.

The Tories claim that their plans would mean 600,000 more childcare places and nine million hours of free childcare a week.

Interviewed on the BBC’s Daily Politics Show, Mr Gyimah confirmed that there would be a consultation with the sector if the Conservatives are elected.

 ‘We’ve also amplified that we need to support the childcare sector to deliver this because if we’re doubling the number of free hours to parents we need to make sure that the hourly rates that the childcare providers get is the right rate and they can deliver it. We’re also going to review the funding formula for nurseries and childminders,’ he said.

‘The reason why that is important is that to talk about the free hours without talking about how it’s delivered would actually mean that the system could keel over, which is what organisations like the National Day Nurseries Association have been saying.

‘We’re pledging that we’ll review it – no other party is.’

Mr Gyimah added, ‘If elected we’ll engage in a consultation with the sector. There are a number of things we’ve got to look at. Increasing the hourly rate. We’ve got to look at LA top-slicing. What has been happening so far is that the money has been going from central Government to local authorities who then top-slice the funding and then give it to nurseries. Some local authorities discriminate between private and voluntary providers versus state providers. We’ve got to look at the whole system with the sector.’

The 30 hours a week would be available to households where all parents work a minimum of at least eight hours a week.

It would also be available to higher income households, with no upper limit.

However, Mr Gymiah claimed that it would benefit lower income families the most.

‘The people that benefit the most would be the people at the lower end, so anyone earning £52 a week would benefit from it,’ he said.

‘We’re the only party pledging to do this work to make sure that an increase in the hours that we seek to do will actually work.’

The Conservatives have costed their plans at £350m, but this has been disputed by shadow education secretary Tristram Hunt.

Labour says that its plan to increase the offer for three- and four-years-olds to 25 hours a week would cost £800m, a figure it says has come from Treasury estimates.

But Mr Gyimah disputed Labour’s figures, because he said that it did not take into account savings in Universal Credit and benefits that would result.