Early Years Providers: Government Support

Freddie van Mierlo Excerpts

Wednesday 9th July 2025 Westminster Hall

[Helen Hayes]

On the first part of the hon. Lady’s intervention, that is exactly what the Government are trying to do in establishing school-based nurseries: to ensure that across the country there are a range of settings that support children’s development so they arrive at school in reception year ready to learn.

I welcome the Government’s expansion of early years provision through the roll-out of funded hours and the delivery of 3,000 new school-based nurseries. That will make a huge difference to families, giving parents the option to return to work and helping with the costs of childcare, which under the previous Government resulted in many families spending more on childcare than on their rent or mortgage and, for the first time in decades, saw women leaving the workforce because the costs of staying in work were simply unviable.

In delivering the roll-out, it is important that the Government pay close attention to the financial resilience of early years providers. Many providers have been flagging for a long time the fact that the hourly rate they have been paid does not match the costs of delivering funded hours. There have also been inconsistences in the way local authorities pass on the Government subsidy. The previous Government’s funding model created distortions in the costs of childcare, with parents of the youngest children paying very high rates to cross-subsidise the costs of providing underfunded funded hours for three and four-year-olds. Nurseries have also experienced rising costs in relation to energy, food and insurance, and they are also now having to adjust to increased employer national insurance contributions and the increase in the national minimum wage.

Sadly, we have seen far too many early years settings close in recent years because they cannot make their business model work. It is important that the Government pay careful attention to the financial resilience of the sector and take steps to ensure that nurseries do not close due to high costs and inadequate rates of funding.

[Freddie van Mierlo (Henley and Thame) (LD)]

The hon. Lady is absolutely right to point out the eye-watering cost of nursery care for parents. Parents in my constituency tell me that, like me, they spend thousands upon thousands a month, when in other countries it costs just hundreds of pounds a month. One of the most recent contributing factors is the rise in national insurance contributions, which for me increased nursery fees by 10%. Does the hon. Lady regret the Government not accepting Lib Dem amendments to exempt nurseries from the extra charges?

[Helen Hayes]

I do not regret the Government not accepting Liberal Democrat amendments that are not accompanied by any means of plugging the funding gap that would be left by the additional commitments they ask the Government to make, but it is important that the Government continually look at the resilience and sustainability of the early years sector in the light of what are undoubtedly additional costs and challenges that the sector is having to bear. That will be important for the delivery of the roll-out and for provision across the country.

Early years practitioners do such important work. We trust our most precious family members into their care, and they have the capacity to make an enormous difference. Yet there is a recruitment crisis in the early years. We do not value early education and childcare enough, staff are paid far too little, and there are insufficient opportunities to gain specialist qualifications and to progress. I visited the Sheringham nursery and children’s centre in east London, which has a large sign at the gate that reads “Building Brains Here”. The nursery’s work is just that: laying the foundations for the rest of a child’s life. We must find the ways to value early years staff more, promote the early years as a rewarding and vital vocation, and ensure that staff are appropriately paid, with good opportunities for progression.

In that context, I welcome the Government’s newly launched strategy to give every child the “best start in life”, and the commitment to expand the number of stronger practice hubs, such as Sheringham nursery school and children’s centre, which play such an important role in strengthening good practice across the area in which they sit, and to incentivise early years practitioners to work in areas of deprivation where their expertise is so important.

Childminders are often overlooked in the debate about childcare and early years education, but they are a vital part of the landscape of care and education for many families. They play a critical role in the lives of the children in their care and they are the option of choice for many parents and carers, particularly for very young children. The number of Ofsted-registered childminders has been declining for several years, and many earn unacceptably low levels of income.

I welcome the steps the Government are taking in the new strategy to try to stabilise the income of childminders and encourage childminding as a profession, as well as promote innovations in childminding practice, which would help childminders to work together across a local area and in partnership with schools. I also wholeheartedly welcome the Government’s commitment to expand Best Start family hubs, building on the success of the previous Labour Government’s Sure Start programme, the proud achievement of my late predecessor Dame Tessa Jowell.

Sure Start played a vital role in supporting the landscape of childcare, often with a nursery on site plus supporting networks of childminders in a local area, offering them training and development, and building relationships with parents. For the most vulnerable and disadvantaged parents, more is needed than simply making a child place available. Sure Start centres, by offering play-and-stay sessions and parenting classes, built relationships of trust with parents, boosted their confidence and often acted as the gateway to taking up a nursery place, which is beneficial for children, and to re-engaging with the labour market and education for parents. Best Start family hubs are badly needed, and I hope they will play a similar role.

I also welcome the focus in the strategy on the quality of early years provision and inclusion. It is an unacceptable reality that the parents who find it hardest to find childcare places are the parents of children with special educational needs and disabilities, and that approaches to SEND inclusion vary widely across early years providers, which is not acceptable. I welcome the attention the Government are giving to that issue.

Finally, I want to draw attention again to the role of maintained nursery schools within the landscape of early years providers. Maintained nurseries are unique in being constituted as schools and required to employ a headteacher and qualified teaching staff, but they are excluded from the schools funding formula. Their funding has been dramatically eroded relative to their costs in recent years. Maintained nurseries are often beacons of good practice located in areas of deprivation, and are inclusive settings with an expertise in SEND.

The Minister will know that many maintained nursery schools have closed and many that remain are operating with unsustainable financial deficits. I say gently to my hon. Friend the Minister that the response of the Government to my inquiries on this topic, which is largely to push responsibility to local authorities, simply is not sufficient when local authorities are not fully funded to support maintained nursery schools. It cannot be right that, as the Government set out an ambitious new strategy for early years, some of the institutions with the greatest levels of expertise and the most successful track records of delivery are being left effectively to wither on the vine.

I call on the Minister to set out a plan for maintained nurseries, to reform their funding model and ensure their long-term sustainability. The Education Committee, which I chair, will turn attention to the early years in the coming months, and I look forward to making our contribution to scrutinising the Government’s work in this vital sector that makes such a difference.

Dedicated Schools Grant

Freddie van Mierlo Excerpts

Tuesday 6th May 2025 Westminster Hall

[Freddie van Mierlo (Henley and Thame) (LD)]

In Oxfordshire, we receive an area cost adjustment of just 2%—that is to take into account the difference in the cost of living in different parts of the country. In London boroughs, that adjustment reaches 18%. It simply does not match the cost of living in Oxfordshire, where house prices are comparable to those in London. Does my hon. Friend share my concern that this lack of funding is impacting the education of our children?

[Cameron Thomas]

As somebody who was—let us be generous—barely educated in Oxfordshire himself, I am very much aware of the issue.

My mainstream schools in Gloucestershire fall into the bottom 20% of DSG funding, earning £1,000 less per pupil than schools in the top 20. This means that Cleeve school, for example, with its 1,851 pupils, faces an approximate annual deficit of over £1.8 million compared with a similarly sized school in Middlesbrough.