Hansard

From August this year, universal funded early learning and childcare for three, four and vulnerable two-year-olds will increase from 600 to 1,140 hours per child, per year. The Scottish Government promises to provide high-quality and flexible early learning that is accessible and affordable for all families. For the most part, the policy was well intentioned, has been well received, enjoys broad political support and is viewed as a positive step towards encouraging parents back into the workplace and closing the attainment gap, which is vital.

So far, so good. It is hard to disagree with any of that, I hear members say, “So why it is urgent that we have this debate?” Two years ago, Audit Scotland published “Early learning and childcare”, which was a comprehensive report that looked at the increase in provision from 475 to 600 hours per year. It flagged several concerns about the proposals to increase that to 1,140 hours. On page 5 of the 2018 report—right up front—it said:

“There are significant risks that councils will not be able to expand ... to 1,140 hours ... In particular it will be difficult to increase the infrastructure and workforce to the levels required, in the limited time available.”

Just last week, Audit Scotland published “Early learning and childcare: Follow-up”. On page 5 of that report—right up front again—it states:

“These plans are critically dependent on achieving much in a short time ... This creates ... significant risks around getting enough people and buildings in place to deliver the expansion ... it is likely that some aspects of the policy, such as delivering flexibility and choice, will not be ... implemented by August 2020.”

Therein lies the answer to why we are having the debate. Two years ago, detailed, well-researched and independent commentary from a respected institution highlighted the key challenges that the Government faced. Two years on, those same risks are repeated, almost word for word, in the 2020 report.

Against the helpful backdrop of political consensus on the policy, today’s debate is crucial in bringing to the attention of ministers the fact that, out there in the real world, there are real concerns. There is genuine good will in the chamber to support the roll-out of the additional hours of provision, but the Government ignores our concerns at its peril.

Following the initial expansion of early years provision in other parts of the United Kingdom, there are many lessons to be learned. Following the release of two in-depth Audit Scotland reports on the deliverability of the policy, one would think that the Scottish Government was armed with more than enough best practice, historical learnings and reality checks to have, at the very least, the modesty to admit that the policy is proving to be an almighty and challenging promise to deliver. However, in the absence of such modesty, as the Government’s amendment predictably and disappointingly illustrates, the issues that we highlight today will be ignored.

Our motion positively welcomes the Government’s ambition and rightfully acknowledges the cross-party support that that ambition continues to receive. In our motion, we point ministers in the direction of Audit Scotland’s report, which notes some basic but important elements of the roll-out that pose a risk to its success. Those comments mirror the concerns of stakeholders who we have spoken to in the past few weeks.

Many eyes are on us today, such is the interest in getting it right. I say to those on the Government benches, “Please listen and let us help you to get it right.”

There is a lot to cover, so I have chosen a few themes that strike me as the most pertinent and most in need of being the focus of our attention. First, Audit Scotland’s report focuses on concerns over the infrastructure and workforce requirements to deliver the policy fully and on time. The second theme is sustainable funding and the role that funded providers will play, and the third is how the policy is being communicated by local authorities to early years providers.

Audit Scotland’s report raises serious concerns about whether local authorities will have the staff, capital infrastructure and networks in place to deliver the Government’s ambition in five short months. By September 2019, the number of staff who had been recruited to meet council-delivered demand was around 4,300, which is about half of the 8,200 staff that they will need to be fully staffed. By any measure, that is some way off target, and that is before we discuss the funded provider sector, which is also struggling as many staff move from private to council settings.

The minister will be keen to wax lyrical about what the Scottish Government has done so far and, today, she will no doubt point towards the increase in training opportunities and Government initiatives that are under way to improve recruitment. That is all very welcome, but the numbers speak for themselves. What started as an absolute guarantee from the minister to deliver the policy by August 2020 last week turned into the comment that:

“We are confident that ... we will deliver ... this August.”—[Official Report, 3 March 2020; c 4.]

Confidence is one thing; the ability to deliver is another. How the Government is going to double its recruitment numbers in a few short months is beyond me.

The people are not there and neither is the infrastructure. We are some way behind in the provision of the physical classrooms and buildings, the shared back-office systems, and the billing and financial reconciliation processes. Audit Scotland could not have been clearer on that. It said that

“Any delays to this will impact on service delivery”,

which we are already starting to see. In Renfrewshire, delays to a major refurbishment of Lochwinnoch nursery have local councillors worried about whether they will cope with the increased demand that is placed on them. A council-run nursery in North Ayrshire had 60 applicants for just seven places. The cracks are already beginning to show.

The problem with loading capacity-building projects into the final few months means that any delay to those projects runs the risk of derailing delivery at the last moment. The Government talks about contingency planning in its amendment, which is surely a thinly veiled admission that all is not well. What are the so-called contingency plans and why do we need them?

On the face of it, as I said, the policy sounds all well and good. Few parents will complain at their nursery bills dropping from £700 to £200 a month, which leads me to a crucial point in the debate: funding and sustainability. The Scottish Government was eager to promise that local authorities will pay a sustainable rate to funded providers that will cover the true cost of running the service and providing a living wage to staff and allow for future investment and expansion in premises. However, unless someone has been living in a cave for the past six months, they will know that that is not playing out as intended.

In part, that is because some local authorities were underfunded from the outset. The Scottish Government tasked local authorities with setting out their financial projections for how much the expansion would cost to deliver in revenue and capital terms. Local authorities diligently costed the expansion and submitted their figures to the Scottish Government. However, 12 councils found that they will receive less revenue funding than they asked for, and 18 councils received less capital funding than they estimated was needed to increase capacity, as was the case for South Lanarkshire Council.

However, the big elephant in the room is the issue of funding and the sustainability of the rate that funded providers are being offered to deliver the additional hours in return for signing up to the scheme. Today, many nurseries survive only by topping up the subsidised 600 hours per child per year rate; they have to be up front with parents about the hourly rate that they will charge and about what they will get for their money. Under the new contract, providers will have to deliver the funded hours at the agreed rate of subsidy, with no top-ups or extras. For many, that rate is less than the cost of providing the care and learning. Therefore, we need to have a sensible discussion about what constitutes a sustainable funding rate and why there is so much unexplainable divergence across Scotland.

To make ends meet, providers will face stark choices, none of which appeals to them very much. They can increase the rate that they charge for additional hours—the hours above the 1,140—and some have already done so by as much as 15 per cent, which will hit hardest those families who need more hours.

To make ends meet, providers could reduce the quality of service. As one nursery described, at the moment, parents get bells and whistles, high-quality, freshly prepared food and tonnes of extra-curricular activities. With the new rate, the nursery might have to charge extra for those services or reduce the quality of the experience. We know who the losers are in that equation, as the people the funded hours seek to help can least afford the extras. Many providers will give preference to applicants who want full-time places or require more hours, which will hit parents who want to work or study part time.

The Scottish Government promised a “provider neutral” approach to ensure that funding follows the child through whichever means of care the parents choose. The Government will stick to those lines today but providers have no way of tracking the child, money or hours.

The third point that I will raise is on communication, consultation and the roll-out of the policy. Providers raise their concerns with us and with the Scottish Government. The Scottish Government is failing in its duty to foster relationships between providers and the funding authorities. In its stakeholder outreach, the Parliament’s Education and Skills Committee found that there is major tension between local authorities and many providers. Many private and third sector nurseries feel as though they are being ignored by decision makers. The Government knows that there is tension, but it cannot abdicate its responsibility to ensure that all providers of early learning and childcare are funded properly, as it claims that the policy will do.

What is the point of expanding early years funding? The Government says that it is to improve the attainment of our children, to encourage parents back into work and study, and to improve family wellbeing. Those are admirable aims, but they must also be measurable.

The Audit Scotland report rightly raises concerns about the absence of a robust strategy or the baseline data that is needed in order to analyse properly the short, medium and long-term success of the policy. If we cannot confidently analyse outcomes, how will we know whether the investment has offered value for money?

I have barely scratched the surface of the ground that we need to cover today. Since the expansion was first mooted by ministers, ELC providers have been forthcoming and vocal about their issues around recruitment and sustainability and their concerns about maintaining the high levels of quality of care that they want to provide. All those concerns have been vindicated in two Audit Scotland reports.

The Scottish Conservatives will work constructively with the Government to help it deliver that policy, but that requires the Government to work constructively with those who are tasked with delivering it. The nothing-to-see attitude in the Government’s amendment is unsustainable and untenable. I will take no joy in coming back to the chamber in five months’ time to say to the minister, “I told you so,” but, unless the members on the Government benches listen carefully to what is being said here today, I fear that I might have to do just that.

I move,

That the Parliament recognises the strong cross-party support for the expansion of funded childcare to 1,140 hours; expresses its concern however, regarding the findings of the most recent report by the Auditor General for Scotland and the Accounts Commission, Early learning and childcare Follow-up, which states that certain risks remain around buildings, staffing and the sustainability of the private, voluntary and independent sectors; is concerned that the report notes that it is likely that flexibility and choice for parents will not be fully implemented by August 2020, and that any delays to the expansion will impact service delivery and families who are planning to use these services, and demands that the Scottish Government urgently addresses these concerns.