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Tory MPs Want Tax Relief And Top Up Payments To Help Nurseries Fund Free Hours


4 min read

A top-up payment scheme and tax relief for nurseries are among measures Conservative MPs would like to see in the Autumn Statement to support the government’s extension of free childcare hours from next year.

Earlier this year, Chancellor Jeremy Hunt promised a new childcare package that will see 30 hours a week of free childcare extended to children aged between nine months and school age. 

However, new research by the Early Education and Childcare Coalition and the University of Leeds, published by The Guardian earlier this week, found that 57 per cent of nursery staff are considering quitting the sector within the next year, which could lead to a major staffing crisis alongside an expectation to increase places. 

The same study found that few nursery managers are confident they will be able to accommodate the extended free hours without government support. Only 17 per cent of managers who responded to the researchers said it was likely they would increase the total number of places they offered as a result of the extended hours, while 35 per cent thought it was likely they would place limits on the number of places they offer funded by free hours entitlement. 

Government officials have said that the findings of this survey differ from their own research, which found that the workforce is “stable”. But they admit there is “more to do” on the issue.  

Chair of the Education Committee and Conservative MP for Worcester Robin Walker told PoliticsHome that their inquiry into support for childcare and the early years sector recommended a number of changes ministers could make, such as exempting nurseries from business rates.

While the Department for Education responded to the inquiry, it would be the responsibility of the Treasury to make changes to any taxes associated with the early years sector. Last month, Walker wrote to Chancellor Jeremy Hunt and asked him to consider the matter of a nursery business rate exemption “when drafting the upcoming Autumn Statement”. 

“I think we have to provide [businesses] with more help," Walker said.

"That's why some of the recommendations we made were around taking pressures off the sector through business rates and investing in for career development for the sector.

“I wrote to the Treasury on this, basically to highlight those recommendations and say [the Department for Education] have rejected them because there's not they're not within their gift, and actually, we think you need to look at these again further.”

Conservative MP and fellow member of the education committee Miriam Cates has been critical of the government's childcare proposed childcare reforms, and argues that instead ministers should be “using the tax system better to make it more affordable for families to live on one income in the very early years of a child’s life”.

But she agreed that an "easy way to alleviate some of the pressure" on the sector would be for the government to provide more money per hour to nurseries for the free entitlement, or allow nurseries to charge top-up fees so that parents could further subsidise the government allowance. 

"It's not going to solve the problem of workforce shortage overnight, of course, but hopefully stop so many nurseries from closing,” Cates said. 

Jonathan Broadbery, director of policy and communications at the National Day Nurseries Association told PoliticsHome that staff recruitment and retention “consistently comes out as the top issue” facing his members. 

“We’ve been talking to Government since 2017 about the workforce challenges facing the early years sector because over time we’ve seen high staff turnover [with] people leaving the sector to go into other areas like retail or hospitality because they can get better pay for fewer responsibilities," he explained. 

“It’s a lot of responsibility looking after our youngest children, doing your best for them, and there’s some really passionate people who unfortunately are leaving the sector.” 

Responding to the Early Education and Childcare Coalition report, shadow education secretary Bridget Philipson said: “Families up and down the country already struggling to get childcare will see the Conservatives’ announcement in last year’s budget for what it was – a short-term attempt to grab headlines.

“Widening eligibility for childcare without a plan for new places or a workforce to staff them could see the Tories crashing the childcare market just like they crashed the economy.” 

A spokesperson at the Department for Education said: “We are rolling out the single biggest investment in childcare in England’s history, and are confident in the strength of our childcare market to deliver 30 free hours of childcare for working parents from nine months old up to when they start school. 

“The findings of this survey differ markedly from our own work which shows the early years workforce is stable. But we know there is more to do – which is why we are launching a new national recruitment campaign in the new year, and an accelerated apprenticeship route into the sector to help recruit new staff.

“We are investing hundreds of millions of pounds to increase rates paid for government-funded hours, which can be used to support staff salaries, and are providing a package of training, qualifications, and expert guidance worth up to £180 million.”


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