HC Deb 16 July 1993 vol 228 cc1307-16

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Arbuthnot.]

2.5 pm

Mr. John Heppell (Nottingham, East)

First, I thank the Speaker's Office for giving me the opportunity to raise this issue today.

I became interested in child care because of something that happened locally. I do not profess to be an expert on it, but I have some knowledge of Cedars nursery in my constituency, which is due to be closed. I should therefore like to address the issue on a national level and a local one.

My knowledge about child care nationally stems from what has happened locally. It seems fairly strange that, at a time when many of our major employers are banding together to try to guarantee better child care facilities in the community, the national health service should cut its child care provision. Those major employers are members of the forum, Employers Childcare, and they include the BBC, British Telecom, British Gas, the Co-operative bank, Kingfisher plc, Rover Group and the TSB Group plc. They all want to improve child care provision in the community. They are not driven to do that because child care is an equal opportunities issue or a women's issue. They are not concerned about issues that are peripheral to their business. They are not in the business of charity.

The aims of that forum are clearly set out in its statement, which says: The provision of quality child care will help businesses to maximise their commercial potential and make the best use of the skills and labour available. The members of that forum want to make their businesses more efficient and effective. They want to improve the provision of child care in order to retain their highly skilled and experienced staff and to reduce recruitment costs, absenteeism and poor records on punctuality—all caused because of the conflict between child care and work. They want to stop waste and increase their profits.

The House should remember that I am talking about hardheaded business men—sometimes they are hardhearted—whose interest in child care is not founded on charity. They want to invest in it because they realise that they spend tens of thousands of pounds on training staff and that those staff acquire years and years of experience. Employers recognise that their small investment in child care makes not only common sense but good economic sense. I am pleased to note that the Secretary of State for Employment seems to support that important initiative.

There is no doubt that our record on child care is not good. We do not offer the same level of provision as that offered by our European competitors and that puts us at a real disadvantage in the market. According to a survey conducted in 1992 by the organisation, Working for Childcare, which is devoted to promoting good child care in the United Kingdom, there are fewer than 450 workplace nurseries in the United Kingdom and 50 per cent. of them are in London or the south. That amounts to some 12,000 full-time day care nursery places, which represents just one place for every 300 children who require it.

Although I welcome the tax relief proposals that the Government made in 1990, they will have little effect because 60 per cent. of workplace nurseries are in the public sector and cannot benefit from tax relief. Only 16 per cent. of such nurseries are in the private sector. Joint schemes between the public and private sectors represent some 20 per cent. and may be the best way to improve child care. I do not wish to be dogmatic because I am happy whether workplace nurseries are run privately, by the public sector or by a partnership between the two. I simply want more child care places to be made available.

The national health service has more workplace nurseries than any other employer. I applaud many of the district authorities' imaginative child care initiatives and congratulate them on their vision in realising the benefits of child care. However, we must put the figures in perspective. The NHS has more workplace nurseries than any other employer because it is the biggest employer in Europe, employing more than 1 million people, three quarters of whom—750,000—are women. Because the NHS is so big, its child care provision is not as good as one first thinks.

I shall quote the figures produced by the British Medical Association because those produced by the Department of Health are abysmal. The BMA's figures show that, of the women who leave the NHS for maternity reasons, only 17 per cent. return to the NHS after the first year of pregnancy. By comparison, more than 50 per cent. of women who leave their employment in banks for the same reason return after the first year. What is the Government's response to that? Clearly, something is wrong if only 17 per cent. of nurses return to work in the NHS. What are the Government doing about it? The Department of Health's response seems to be that it is doing very little and plans to do even less in the future.

When seeking answers, I deliberately narrowed my inquiry down to nurses because I thought that if I asked about all staff I would get no answers. I discovered that the Department of Health had incomplete records for 1988 and 1989 because 11 regional and district health authorities had not responded to its inquiry. The Department's 1990–91 records for the number of people who left the NHS for maternity reasons were also incomplete because 27 units either did not reply or the data that they provided were inadequate and could not be used in the statistics.

However, it became clear that thousands of nurses were leaving the NHS every year for maternity reasons. When I tried to find out how many returned to the Department of Health after maternity leave, I discovered that there was no record of that. That is abysmal. The retention saving for just one D-grade nurse is some £28,000. That makes me wonder how much money is being lost to the NHS because people still maintain health care philosophies dating back to the last century. I hope that I shall receive a positive response from the Minister about the Department of Health's national strategy. The employers forum and many major employers say that the Government need a national strategy for health care—where is it?

Compared with the private sector, the NHS has a good record, but that is not to say that it has a good record per se. I am worried that, particularly with the introduction of trust status, if no direction is given by the Secretary of State, the Department of Health will not provide any sense of direction. If there is no direction from the Department of Health, there will be no direction from the regional or district health authorities. That will create a feeling among the trusts and units being set up, which do not share the long-term economic view of child care, that they have no incentive to push for a health care strategy.

I have two questions for the Minister on the national strategy. Will he consider two of the recommendations made by the British Medical Association in its report, "Childcare for Doctors in the National Health Service"? First, will he ensure that the national health service unit conducts a comprehensive survey of child care provision on behalf of the NHS management executive? Will that survey address the specific needs of health service employees who have to work shifts and at weekends?

Secondly, will the Minister ensure that NHS and trust hospitals have an incentive to provide child care facilities through some form of subsidy equal to the tax relief enjoyed by private employers? At present, private employers benefit from tax relief, but NHS or trust hospitals cannot, which leaves them without an incentive. Had those two recommendations been in force, the local incident which I am about to describe would not have occurred.

I refer to the closure of Cedars nursery. It is an excellent nursery which I have visited on several occasions, and I have talked to staff, parents and people involved in it. The Minister may ask why the nursery is to close. I think that he has some reasons for its closure, but I hope to persuade him otherwise. The nursery is not going to close because there is no need for it in the district; there is a definite need—the health authority has 15,000 employees and the nursery has 30 places. At best, it can provide places for 40 children from 40 different families. Therefore, it is obvious that there is a need for it.

The nursery is not going to close because staff and parents do not want it to remain; they do. It is not going to close because it is unsuccessful; it has been an enormous success. There are two reasons why the nursery is to close: first, the district health authority did not have the foresight to plan properly to ensure that the nursery survived, and, secondly, many of the senior management in the NHS are not committed to child care.

Cedars nursery was set up 20 years ago. A few Saturdays ago, I went to its anniversary celebrations. If I or anyone else had any doubts about how successful and prestigious the nursery was and how much support it enjoyed among people in the district, those doubts would have been wiped away by the anniversary celebrations. So many people responded to the invitations that there had to be two celebration cakes. As I walked about the 30-place nursery, all I heard from the hundreds of people who attended the anniversary celebration—including parents, children, past parents and past children—was praise for the nursery. I have heard praise for the nursery from everyone who has had any involvement with it. It is echoed by everyone I talk to in the NHS—every trust, unit and hospital. They all say that it is a marvellous nursery and a great success.

In correspondence on this issue with the hon. Member for Gedling (Mr. Mitchell), the chairman of the health authority said: Managers here at the Health Authority, in conjunction with the providers in Nottingham—whether it be directly managed units or NHS Trusts—will continue to explore all options which will allow us to maintain what I am pleased to note is acknowledged as an 'excellent nursery education' in a way that is equitable to all those parties involved. That is hardly faint praise—the man means it. The problem is that he goes on to identify the reasons why the nursery is to close.

It is astounding that the nursery should be closed for the reasons given. Now that the units are going their separate ways because they want to achieve trust status—some have already achieved it—Nottingham health care unit, which itself is in the process of going for trust status, feels that it has been left holding the baby; indeed, it feels that it has been left holding a number of babies. It has been left with the funding and running of a nursery which predominantly caters for the children of staff who work in the other units, which have now become trusts. The staff at the unit therefore say that the nursery is not their responsibility, because they are not using its services.

The city hospital trust and the Nottingham community health trust, with staff whose children attend the-nursery, say that they were never given funding for the nursery; it went to the other units—so it is not really their responsibility either. When I tell the district health authority that the nursery is going to close, it tells me that it is now a purchaser, not a provider of facilities—so the nursery is no longer its responsibility. I do not exactly agree with that. When I write to the Secretary of State, I receive a letter from the Under-Secretary of State, the hon. Member for Battersea (Mr. Bowis), saying, in effect, that it is not his responsibility either.

The facts are that the nursery is closing down, and that it is not the responsibility of the units, the trusts, the DHA, the RHA, the Secretary of State or the Department of Health—so no one is to blame for the closure. I should be failing in my duty as a responsible Member of Parliament if I accepted these explanations for closing an excellent nursery which is highly regarded by everyone in the area.

The Minister, in his letter, did attach a certain amount of blame to someone. He said: Officials have contacted Nottingham Health Authority and I understand that employees have asked for future child care initiatives for health service staff in Nottingham to concentrate on the development and strengthening of holiday play schemes, which will benefit more people than the current nursery is able to help. If that is what the Minister understands—I do not know where he gets his information from—he is wrong. Surveys among NHS staff show, depending on how the questions have been asked, that child care features prominently among women's priorities, as do workplace nurseries.

A survey carried out in my region, but not my district, by the Central Nottinghamshire health authority states, in its final paragraph: More flexible working patterns and a seven-day week all-year round Creche were commonly felt to be the most important provision of the future. The questionnaire sent by the Central Nottinghamshire health authority to its staff asks ambiguous questions. This affects my patch because it is in the area of the district health authority. People were asked about their problems with child care and the greatest response was about cost. They said that expensive child care was the biggest worry. The second concern, which was well above worries about finding suitable carers, upset children and unsympathetic managers, was the lack of workplace child care facilities.

Workplace nurseries did not come top of the replies to the question about how matters could be improved. Child care vouchers and cheques were most mentioned. However, 67 to 80 per cent. of the parents were in favour of workplace nurseries for one to four-year-olds. The Minister has been sadly misinformed if he has been led to understand that the employees want to get rid of the nursery.

The final proof that the staff are not the reason for the closure is that the union has formally invoked the grievance procedure on behalf of the staff because the nursery is closing. It lists matters such as recruitment, retention, lack of suitable alternatives and commitment to equal opportuntiies as reasons for doing that.

The nursery closure is a direct result of reorganisation for trust status. I shall not engage in an argument with the Minister to try to persuade him to stop his plans for creating hospital trusts, but I hope that he accepts that in urging hospitals to seek trust status the Government did not intend to close excellent nurseries. That is effectively what is happening because no one is prepared to take responsibility for what existed before. I hope the Minister agrees that the responsibility lies with the district health authority. Before trusts were proposed, the health authority should have made appropriate plans to ensure that the nursery was properly catered for and assured of survival.

Even at this late stage, I hope that the Minister will make representations to Nottingham district health authority about the absurdity of a Department campaigning vigorously to increase child care places and putting up about £45 million to do it, while at the same time denying such facilities to people in my area because those making the decisions about it follow the child care philosophy of three decades ago.

Those who understand the importance of child care are members of the Employers for Childcare which is campaigning for more child care. I wish that my district health authority had the same competence so that we could be assured of decent child care facilities.

2.28 pm
The Parliamentary Under-Secretary of State for Health (Mr. John Bowis)

I congratulate the hon. Member for Nottingham, East (Mr. Heppell) on having the good fortune to secure this debate. I spent six weeks prior to my appointment seeking the same good fortune but without success. My consolation prize is to respond to the debate. I also congratulate the hon. Gentleman on bringing before the House the proposal by Nottingham health care unit, which is part of Nottingham district health authority, to close the Cedars day nursery.

The letter that I sent to the hon. Gentleman clearly states: It is a matter for each local authority to determine and fund the provision of child care facilities for staff in the light of local need. There is no question of not knowing who is responsible. I did not use the word "blame", because I was not apportioning blame. I am sure that the hon. Gentleman understands that I understand that those are matters wholly for the district health authority. The Secretary of State and I do not have jurisdiction. It is not like a case of hospital closure, where the community health council can appeal to the Secretary of State.

The debate gives us the opportunity to explore together the issues and decisions in the case and reflect on some of the wider points that the hon. Gentleman has made. I listened to him with interest. I welcome his acknowledgment of the initiatives in the NHS.

It being half-past Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Question again proposed, That this House do now adjourn.

Mr. Bowis

The initiatives are important. They are developing and I am sure that both the hon. Gentleman and I hope that they expand in many other parts of the NHS. I recognise the local knowledge and concern that underlie his remarks. I am sure that he is anxious to secure the best possible facilities for his constituents and shares with the management of Nottingham healthcare unit and the two Nottingham trusts—Nottingham city hospital and community health—a real concern to ensure that employees derive all possible assistance in combining a career with a balanced and harmonious family life.

The hon. Gentleman spoke about records, responsibi lity, employment and local decisions. As is the case with banks, those are not for national decisions, but for local decisions. It is not for the Department to second guess the local needs and priorities as assessed and decided upon by the local district health authority. That is its job—it knows how to do it best—and we support it as far as we can in the conclusions that it reaches.

The proposal at issue is that the Nottingham healthcare unit does not wish to run the Cedars day nursery at a financial loss, and the nursery will have to close not later than 31 March 1994. The nursery was established in 1973 as a child care facility for the children of staff employed by Nottingham health authority. It has been managed by the general hospital, which now forms part of the Nottingham healthcare unit. It is financed by fee income from parents and a joint subsidy from the Nottingham district health authority and the two trusts. The majority of registered users work at the city and community health NHS trusts. That is, 62 per cent., or 26 children, from the former and 21 per cent., or nine children, from the latter, with four children from the district health authority.

Let me stress, as the hon. Gentleman has rightly stressed, that the manager and nursery nurses at the Cedars are to be congratulated on the high standard of child care that they have provided over the past 20 years. The hon. Gentleman spoke of people echoing that fact, and I am happy to join them on behalf of my Department. That fact has not gone unnoticed and has been valued and praised by parents and hospital management alike. Despite that quality, it has not attracted the numbers to fill the nursery. Cedars offered a much-needed resource in previous years, particularly when there was little or no independent nursery provision in the area and when the child minder network was both in its infancy and very informal. Just over one third of its 30 places have been provided for children aged up to two years.

Between 1988 and 1992, the number of places in registered day nurseries throughout the country grew by 100 per cent., while the number of child minders rose by 40 per cent. There are now 90,000 places in registered day nurseries all over the country, and 106,000 registered child minders offering 240,000 places for the under-fives. Despite the tone of the hon. Gentleman's comments, I hope that he will recognise that there has been extraordinary progress to providing a multi-agency approach and giving choice of different types of provisions—the hon. Gentleman acknowledged the desirability of that—and there are the figures to show it.

Mr. Heppell

I do not dispute the fact that extra places have been made available through child minders and private nurseries. The difficulty in the recruitment of children for the nursery arose only when the health authority let it be known that it intended to close the nursery.

Mr. Bowis

There are at least 130 nursery places within a two-mile radius of the Cedars. Therefore, managers in Nottingham have asked themselves whether it is justifiable to continue to subsidise a loss-making facility with money that could otherwise be spent on direct patient care.

As a small, 30-place nursery, which is not based on a major hospital site, the Cedars meets only a very small part of the child care requirements of the 14,000-plus people employed by the health service in Nottingham. Nor is it ideally located for the majority of Nottingham health care unit staff, who typically form less than 10 per cent. of the registered users of the facility.

I understand that the decision to close the facility has not been taken lightly. Over the past five years, the future of the Cedars has been carefully considered by local managers. Currently, the facility is subsidised by the district health authority and the two trusts. However, even with parents paying a rate of £65.25 per week, which compares with a commercial rate in the area of between £65 and £82.50, there remains a subsidy to find, amounting to £4 per full session per child.

The nursery carried a deficit of £38,000 in 1992–93 and expenditure is expected to outstrip income by more than £28,000 again in 1993–94. That does not take into account the considerable capital expenditure for upgrading the fabric of the Cedars that would be required if the facility were to remain open—for instance, repairs to roofing, guttering and the ventilation system. It is believed that that money could be better spent in the health service on patient care.

A business plan for recovery of the capital costs of the upgrading, together with recovery of the existing subsidy over the next three years, would require an immediate increase of almost 30 per cent. in the weekly charge at the Cedars for current users. That would bring the charge up to almost £85 per week, which is well above the cost of places available in the commercial sector. Indeed, I understand that those 130 private nursery places nearest to the Cedars cost less than £75 per week.

Alternatively, the Nottingham health care unit estimates that it would be necessary to double the number of children using the nursery in order to make a commercial case for continuing to run it. I am told that the average occupancy at the Cedars over the past year has been 65 per cent., and I understand that the capital cost alone of expanding the nursery to accommodate twice that number would be in excess of £170,000.

I draw the hon. Gentleman's attention to the fact that there is another, expanding facility close to the Cedars—the Queen's medical centre at the University hospital NHS trust. It is within 10 minutes travelling time of the Cedars and is a 50-place, privately run day nursery. It is expanding its capacity to 78 places and has already agreed with the Nottingham health care unit that children from the Cedars can be accommodated there if the parents so wish. The charge for a full place, including meals, is about £77 a week, which is £8 less than the charge that would be required for the Cedars were it to become commercially viable.

The hon. Member will join me, I am sure, in applauding the decision of managers at both Nottingham trusts to consult with staff about future staff benefits. The city hospital NHS trust has surveyed one in four of its employees and, in the light of the results, has decided to focus its child care efforts on strengthening the holiday play scheme and finding other ways of assisting with child care responsibilities. It has appointed someone who delights in the title of human resources planning and rewards manager—I hope that he speaks in simpler terms than that title implies—specifically to examine the issues of staff benefits and appropriate child care provision. The trust has therefore decided not to continue to subsidise the Cedars after March 1994.

Nottingham community health NHS trust has discovered that a centralised day nursery facility does not meet the needs of staff working across Nottingham. Efforts will therefore be directed at developing holiday play schemes. I understand that the trust will also discontinue its subsidy of the Cedars after March 1994.

The hon. Member will be aware that nursery places in the commercial sector are available in Nottingham. There are 37 nurseries listed in the city, Broxtowe and Rushcliffe areas, and the Vernon Park day nursery, which is due to open later this year, has advertised 50 places with rates of £70 per week, only a little above the current rate at the Cedars and considerably below the figure required for the nursery to become viable commercially. Nottingham also has an inner-city task force, which has been supporting a number of nursery and child care projects.

I understand that the Nottingham health care unit has always been prepared to consider any proposal put forward by parents or staff, or both, for the future of the Cedars. However, lengthy deliberation has shown that no viable business case has yet been found for keeping the nursery open. Nottingham health care unit and Nottingham health authority agreed to a proposal by parents and staff to form a co-operative to run the nursery, but that option has not been taken up by the parents.

Mr. Heppell

The option to form a co-operative was suggested by the parents. The only problem was that staff were worried that they would have to resign from the NHS to take up posts with the co-operative. The parents asked the unit's management whether they would second the staff to the co-operative, which would have paid them—there would be no cost to the NHS. It was simply a matter of protecting the employees' rights. The unit said that it was not prepared to do that, and in effect gave an ultimatum that unless the staff resigned by 31 May, the co-operative option was off.

Mr. Bowis

I entirely understand that. I imagine that parents and staff would have had to decide on certain issues. Nevertheless, the possibility was explored, even if—as the hon. Gentleman suggests—it was not possible to pursue it for the reasons that he gave, and perhaps for other reasons.

Managers at Nottingham health care and Nottingham health authority are to be commended for recognising the great duty that they owe to the seven staff currently working at the Cedars. The managers would like to put an end to months of uncertainty and to explore reemployment opportunities within and outside the health authority. Their intention is to redeploy staff into suitable alternative posts where possible, or to assist with finding alternative employment.

I emphasise that there is no doubt about the national health service's commitment to child care provision. The Department of Health fully recognises that good child care facilities can be of considerable help—and here I echo the hon. Gentleman's remarks—in reducing staff turnover, recruiting and retaining the services of NHS staff with young children, and competing for skilled staff in the labour market.

In particular, the provision of suitable child care facilities is a key factor in increasing women's participation in the work force, if they choose that following the birth of a child. As the hon. Gentleman lists equal opportunities as one of his special interests, I am sure that he will welcome progress in that respect.

In May 1991, the General Whitley Council reached agreement on new provisions for child care, which commended to health authorities the establishment of an appropriate range of facilities, including workplace nurseries, holiday play schemes and child care voucher arrangements. That is an enabling agreement, which gives each employer discretion to determine the type of assistance appropriate to local circumstances.

In 1991, the Department of Health also launched its "Women in the NHS Initiative" and subsequently joined the Opportunity 2000 campaign, to put women's issues on the NHS managerial agenda. As a result, there has been much interest generated throughout the NHS, and many authorities and trusts are looking at how they can improve their employment practices.

In reality, that has meant that local management has had to examine all aspects of employment practice, including flexible working, term-time hours, job share and, of course, child care. A survey by the NHS management executive at the end of 1991 showed that more than half the health authorities in England provided some form of help with child care. That is progress, and should meet some of the hon. Gentleman's concerns.

The NHS management executive recently produced a booklet, "School's out—initiatives for out of school child care", which focuses on the approaches that trusts and authorities have taken to improve the quality and quantity of child care available outside school hours and during holidays.

I thank the hon. Gentleman for raising those issues and for the chance to respond. I, for one, am firmly committed to the provision and development of appropriate forms of child care in the national health service in the light of local recruitment and retention needs, and in the light of the needs and wishes of local people—as assessed and responded to by local health authorities and local NHS trusts.

Question put and agreed to.

Adjourned accordingly at seventeen minutes to Three o'clock.