My Lords, I listened very closely to what the Minister said about the progress that has been made since Committee. Clearly there has been some progress, but I want to press him on certain points and to reiterate the points of colleagues across the House. The Select Committee said that it was surprised and disappointed at the Government’s response. It was surprised because it is unusual—very unusual indeed—for a government department not to respond more positively to a report of the committee. I will come back to that in more detail. Certainly I am less surprised than the committee, but I am equally disappointed. I understood, like many of us across the House, that what we were to expect, before the start of Report, was a full analysis of the impact that these changes would make, based on the information obtained about the costs borne by the sector and the distribution of those costs, so that the House, to quote the noble Lord, will,
“be able to say a lot more about the delivery model”—[Official Report, 1 July 2015; col. 2093.]
Frankly, that promise has not been fulfilled. We do not know more about the delivery model, we cannot comment on it and we cannot make more sense of it.
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When I looked at the road map, which I was pleased to see although my copy is a bit faint, I was slightly surprised to find that the report on the funding review was shown after the spending review. I conclude from that that the Government had, indeed, known that the report would come after the spending review, and therefore, frankly, did not have much expectation that they could present those findings to us on Report. I have a serious question for the Minister: when did he realise that he would not be able to provide those full findings for us? I think he had two choices. He could have maintained the promise he made to the House that we would have the information we need to debate the full impact and make a proper judgment about the implications of the changes to the sector and the funding issues. To do that he would have had to delay Report stage. The second choice is the one he actually made. I know that in all conscience he was under some pressure from all round the House to delay this stage of the Bill so that we could have a proper debate. In fact, the second choice has been to try to persuade us that the research on the sector done so far is sufficient for us to rest content and trust the Government that all will be well in the best of all possible worlds.
I do not blame the officials at the department one bit for the situation that the Minister is in. They are struggling to master a huge policy change with masses of information, multiple reviews, huge complications and an absurd timetable. There are many potential perverse consequences, as my noble friend on the Front Bench explained. The Minister ought to concede this point and consider delaying further stages. He should do this not least because much of the information
coming forth—for example, from the online questionnaire to parents and the responses to the cost of the childcare review—raises more questions than it answers. The responses to the questionnaire for parents reveal, for example, that around 89% of respondents would take up the additional hours if they were available now. That is good news in terms of demand, but what is not clear, unless I have missed it, is how many of those parents already pay for childcare. What does that take-up do to the whole balance of subsidy across the sector? How many providers might be driven out of business because of that?
I turn to the analysis of responses to the call for evidence on the cost of providing childcare. If the Minister argues that what he meant by “findings” was, in fact, this analysis of responses, which is what he has argued—in fact, it is more of a description than an analysis—I am afraid that he is on extremely shaky ground both ethically and intellectually because the Government have now introduced the concept of a first and final stage of findings. We thought there was one stage when the findings would be produced for the House to make a judgment on.
I argue that not only are there no useful conclusions to be drawn so far from the document we have, but what is presented is simply a quantitative breakdown, which shows that the whole childcare sector is highly fragmented, fragile, confusing, based on very many different models of practice and contracts, and not well documented, as the report makes very clear. Even basic information is not sometimes sound. In fact, the report comments that items such as the main areas of expenditure,
“might not necessarily be the areas where they incur most of their costs”.
In short, what has emerged from this analysis so far is what is surely self-evident: that staff-related costs—namely, wages—are the main cost drivers.
I am not denying the usefulness of this information, but what it reveals is the case for proper analysis and assessment because the reality is this hugely complex sector. This surely reinforces the argument that if we are going to have a proper policy which delivers an expanded capacity, better services for more parents, higher quality and enables more parents to be in work, the impact of those changes on this sector has to be fully analysed and properly understood. With great respect to the Minister, the findings that he has presented, while interesting, are so raw that for the most part they tell us what we know, but nothing about how the capacity or quality of the sector will be affected.
The Delegated Powers and Regulatory Reform Committee is scathing. The Minister has put a favourable gloss on it but it actually says that,
“we are surprised and disappointed that many of our recommendations have not been acted upon. It appears to us that the amendments add very little of substance to the face of the Bill: for the most part they adjust the existing delegated powers by removing some, varying others and adding more, while re-parading many in a new clause. Although the changes to some delegated powers may give the House a clearer idea of how the powers could be exercised, it remains unclear how they will be exercised”.
There is much more like that.
I think I have said enough to make it clear that I believe that a wise Government acting in the general interest of the sector would delay. In the absence of
such a decision, the House should support the sunset clause. As the noble Baroness, Lady Pinnock, says, this does not create delay. This policy will not be introduced until 2017. What will create delay is a dog’s dinner of a policy confusing and frightening the sector into withdrawing services so that fewer people rather than more are able to access them.