HC Deb 17 March 1999 vol 327 cc1142-57

'.—(1) the Secretary of State may by regulations make a scheme for establishing a new category of persons whose charges for providing child care are to be taken into account for the purpose of determining—

  1. (a) the appropriate maximum working families' tax credit for the purposes of section 128(5) of the Social Security Contributions and Benefits Act 1992 or section 127(5) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992; or
  2. (b) the appropriate maximum disabled person's tax credit for the purposes of section 129(8) of the Social Security Contributions and Benefits Act 1992 or section 128(8) of the Social Security Contributions and Benefits (Northern Ireland) Act 1992.

(2) A scheme so made shall—

  1. (a) provide that a person shall not fall within the new category unless he is approved by an accredited organisation in accordance with such criteria as may be determined by or under the scheme;
  2. (b) authorise the making of grants or loans to, and the charging of reasonable fees by, accredited organisations; and
  3. (c) include such other provisions as the Secretary of State considers necessary or expedient.

(3) In subsection (2) above "accredited", in relation to an organisation, means accredited by the Secretary of State in accordance with such criteria as may be determined by or under the scheme.

(4) Regulations under this section—

  1. (a) may make different provision for different cases or circumstances or for different areas;
  2. (b) may make such incidental, supplemental, consequential and transitional provision as appears to the Secretary of State to be necessary or expedient; and
  3. (c) shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.'.—[Dawn Primarolo.]

Brought up, and read the First time.

Madam Speaker

With this, it will be convenient to discuss the following: New clause 2—Eligibility criteria for childcare tax credit— '.—In respect of the childcare tax credit component of working families' tax credit and disabled person's tax credit the Treasury shall, before this Act comes into effect, publish eligibility criteria as to what constitutes qualifying expenditure on childcare and the conditions that must be fulfilled for a childminder to be registrable for this purpose.'.

New clause 3—Eligibility of relatives and guardians as childcare providers— '.—In respect of the childcare tax credit component of working families' tax credit and disabled person's tax credit, the Treasury shall publish guidelines as to whether a person who is

  1. (a) the parent or relative of a child;
  2. (b) has parental responsibility for a child; or
  3. (c) is a foster parent of a child
may, for the purposes of this Act, qualify as a provider of eligible childcare for which relevant childcare charges are payable.'.

Government amendment No. 14.

The Paymaster General (Dawn Primarolo)

I beg to move, That the clause be read a Second time.

I am delighted to be able to move the new clause, which will extend the range of eligible child care for the child care tax credit. There was much discussion in Committee about the eligibility of child care and it is the subject of the other new clauses grouped with new clause 5.

The current rules on eligible child care focus almost entirely on child care for the under-eights, but we have raised the children's age limit to help with child care costs for children up to 14 years, in line with the national child care strategy, and to 16 years for disabled children.

There is little in the current rules to cater for child care for the older age group, whose needs are different from those of younger children. That older group need breakfast clubs, after-school clubs and holiday clubs. Such child care is increasingly available, but the clubs are no longer limited to those run by schools or on their premises, which is what the current rules envisage. They can be organised by commercial organisations or voluntary groups, by voluntary management committees of parents and teachers, or independently from any school. The diversity of the ways in which child care is provided for those older children means that there is currently no common feature that would distinguish the appropriate good-quality providers from the inappropriate ones.

The clause enables us to create such a category of good-quality providers. That category can then be used in the tax credit rules as a definition of eligible child care. The clause is the joint work of the Inland Revenue, which administers the tax credits, and the Department for Education and Employment, which is responsible for the regulation of child care in England; it was drawn up in consultation with the Scottish Office, the Welsh Office and the Northern Ireland Office, which are responsible for child care in their areas.

The clause enables the Secretary of State to set up a two-tier approval scheme. the Secretary of State would accredit appropriate organisations to administer an approval system for child care providers. The details of the scheme would be contained in regulations made by the Secretary of State, as would the criteria for organisations to become accredited so that they can be approved providers.

Subsection (1) sets out the general principle, purpose and limits of the clause. It enables the Secretary of State to make regulations for a scheme to establish a new category of child care provider, the costs of which would be taken into account in calculating the maximum working families tax credit and disabled persons tax credit.

Mrs. Jacqui Lait (Beckenham)

I am grateful to the hon. Lady and to the Government for taking up one of the points that I raised in Committee about provision for children aged between eight and 14, or between eight and 16 if they are disabled. Are the draft regulations available for perusal? If not, will the hon. Lady give me some idea of what definition of organisation will be used? For example, will it be registered companies—whether closed companies, limited companies or plcs—partnerships, or companies owned by only one person? What sort of organisations are we talking about?

Dawn Primarolo

The hon. Lady asks a number of questions and I shall do my best to reply. If I miss one out, I shall be happy to give way to her again on this important matter.

The draft regulations will be available at about the same time as the clause is considered in detail in the other place; a memorandum is now available in the Vote Office. There will be an opportunity to comment on those draft regulations and we shall seek views, especially from the child care sector, and from others who have an interest in these matters, before the draft regulations are laid before the House.

Mr. John Bercow (Buckingham)

Will the right hon. Lady give way?

Dawn Primarolo

If the hon. Gentleman can hold on, I shall finish answering the questions of the hon. Member for Beckenham (Mrs. Lait) and then give way to him.

The hon. Lady asked who the providers would be. We shall be looking to existing recognised child care providers. It would be invidious for me to give a long list, but one current provider is the Kids Club Network, which I shall talk about later in my speech. We shall require that such providers meet a quality threshold and there will be an assessment before accreditation is granted. The child care provider will have to fall within the definitions that I mentioned—for example, breakfast, after-school or holiday clubs. I hope that that has answered all the hon. Lady's questions.

Mr. Bercow

Does the right hon. Lady agree that the regulations should be as succinct and intelligible as possible? If she does agree, will she take account of the fact that the president of the CBI, Sir Clive Thompson, has referred to the creeping paralysis of regulation currently afflicting this country? In the light of that statement, will she give a pledge to the House this afternoon that the final form of the regulations will be shorter than the 72 pages of the working time regulations and the 112 pages of the regulations relating to the implementation of the national minimum wage?

Dawn Primarolo

I assure the hon. Gentleman that we will endeavour, through the consultation process, to ensure that the regulations are clear and precise and assist those who seek to provide this type of child care. As to the length of the regulations, I am sure he accepts that it is crucial that the quality of the providers is set at a high standard. The regulations must provide guidance in that area, and the providers will be assessed according to that criterion. We are talking about people who will care for children, and parents have a right to expect that tight provisions will apply.

We do not seek to write regulations that are of no use—that do not help people and do not achieve their objective. We intend to ensure, through consultation, that the regulations in this important area of child care are as clear as possible.

Mr. Steve Webb (Northavon)

We have just passed the money resolution that pays for the implementation of the new clause. As is the nature of such things, it provides a blank cheque. Can the Minister give the House an idea of the sorts of sums the Secretary of State might spend? How many clubs are we talking about—is it tens, hundreds or thousands? How much money will be spent on accrediting them?

Dawn Primarolo

The hon. Gentleman is always keen to encourage Ministers to cite figures in the House. I do not wish to say that X number of organisations will qualify under the regulations. Many organisations may apply, but the test will be whether they reach the quality threshold. I cannot make an assessment of the numbers at this stage. However, child care provision in many sectors—for instance, Kids Club—is of a high standard, and I am sure that the number of accreditations will reflect demand.

The Secretary of State for Education and Employment will draft and lay before the House the final regulations governing assessment. An assessor appointed by the organisation seeking accreditation will undertake the assessment and then report to the Secretary of State. As to whether there will be any extra burden, I think it is fair to say that we are talking about tiny amounts of money.

Mrs. Lait

I am sorry to pursue the right hon. Lady on this narrow point, but it is best to clarify the matter. Did she say that only current providers will be able to bid for accreditation? Will new firms that pass the quality threshold be able to enter the market?

Dawn Primarolo

I do not wish to mislead the hon. Lady. It is a question whether a provider satisfies the assessor. Accreditation will not be limited only to current providers. I said earlier that there are a huge number of existing providers, but their accreditation is a matter for the assessor. That decision will be made on the basis of the quality threshold. The hon. Lady tried in Committee to ensure that payment for child care could not circulate within family units. Such arrangements should not be viewed as providing quality child care as defined in the eligibility criteria of the regulations.

Mr. Nick Gibb (Bognor Regis and Littlehampton)

Will the hon. Lady give way?

Dawn Primarolo

Yes, but I shall then try to make progress.

Mr. Gibb

Will the hon. Lady explain why, at this late stage, when the Bill is on Report and is to receive a Third Reading later this evening, the Government have tabled a new clause? Why are the regulations not available to be examined before we debate and vote on the new clause? It is intolerable that we will not be receiving those regulations before the Bill receives its Third Reading tonight. Is that not a sign that the Government are in complete disarray over the Bill? It is a sign of an ill-thought-through Bill and clear incompetence.

Dawn Primarolo

I would expect no less a comment from the hon. Gentleman, who could not recognise the purpose of quality child care if it were staring him in the face. We debated that issue in Committee several times, and the Government have responded positively because good points were made. Two Departments have had to work together closely to draft the regulations and ensure that they can be placed before the House when the proper consultation has taken place. I answered the question of the hon. Member for Beckenham about when the regulations would be available and about the consultation process when the regulations were in draft form. If the hon. Gentleman had been paying a little more attention, he might have caught that.

I return to the new clause. Subsection (1) sets out the general principle, purpose and limits of the new clause. It will enable the Secretary of State to make regulations for a scheme to establish a new category of child care provider, the costs of which will be taken into account in calculating the working families tax credit and the disabled persons tax credit.

Subsection (2) says that the scheme will enable accredited organisations—this returns to the point made by the hon. Member for Beckenham—to approve the new type of child care provider within the regulations. It will enable grants or loans to be made to the accredited organisations, and them to charge prospective providers reasonable fees for that assessment. It will also allow the Secretary of State to make such provision as is necessary.

Subsection (3) confirms that the accredited organisations will be those accredited by the Secretary of State under the rules set out in the scheme.

Mrs. Lait

On a point of detail, which is not clear from my reading of the new clause, am I correct in believing that the registered organisations will be registered under education Acts by the Department for Education and Employment, not by local authorities?

Dawn Primarolo

Yes, the power to confer the accreditation will lie with the Secretary of State.

Subsection (4) sets out the powers to make the rules for the scheme in regulations and states that they are to be made by statutory instrument under the negative procedure, under which either House can make a resolution or annul them.

Amendment No. 14 is consequential on the new clause and will enable the Secretary of State to incur the costs of administering the new child care scheme. It will amend the Bill's financial provisions to authorise the Secretary of State to use the moneys provided by the vote of Parliament, a point about which the hon. Member for Northavon (Mr. Webb) asked me earlier.

We have placed a memorandum explaining the details of how the scheme will work in the House of Commons Library, and copies were made available.

Mr. Eric Pickles (Brentwood and Ongar)

This is a technical point. I may have misheard the hon. Lady. Did she say that the registration will be the responsibility of the Secretary of State? As she knows, local authorities have that responsibility for child care providers for children under eight. Will there be two sets of people responsible for registration—local authorities and, for children over eight, the Secretary of State?

4.45 pm
Dawn Primarolo

Yes, for the purposes of eligibility and tax credit, the Secretary of State sets the regulations for children over eight years of age. The hon. Gentleman will know that consultation has been completed and that the details concerning the regulations that apply generally to child care and all child care providers are being considered by my right hon. Friend the Secretary of State. When he arrives at final decisions, the provisions that are before us will fit in with the regulations, whatever they may be.

Miss Anne McIntosh (Vale of York)

I have a simple question on new clause 5 and the hon. Lady's answer will assist me and, perhaps, the House. Has it passed the plain English test?

Dawn Primarolo

I do not know. Is the hon. Lady about to tell me that it has not? We do our best, but if she feels that the clause needs some correction, I should be more than happy to take note of what she has to say. She echoes the point that the hon. Member for Beckenham was pressing earlier about the need for the regulations to be simple, while being clear and precise in their intention.

Broadly, the proposal will allow the Secretary of State to establish a scheme that will accredit organisations that have an appropriate quality assurance scheme for child care providers. Quality assurance schemes will need to cover the way in which the providers ensure the safety and welfare of the children in their care, look at the quality of the activities offered to the children and ensure that they are cared for equally.

Accreditation can be conditional and organisations may be required to supply to the Inland Revenue information about approved providers and monitor the operation of their quality assurance schemes. Once accredited, organisations will be able to approve child care providers who reach the appropriate agreed standard, and the tax credit rules will then enable the costs of child care by these approved providers to be eligible for help.

Miss McIntosh

Will the hon. Lady explain to me what a quality assurance scheme is? Who will define what such a scheme is? Will it be uniformly applied throughout the United Kingdom?

Dawn Primarolo

Quality assurance will be laid out in detail in the regulations. It will cover the period of accreditation; the agreement of the organisation to be monitored and evaluated and to keep and produce records when required; the establishment of an arbitration system by the organisation for the use of child care providers who are unhappy with the decision not to approve them; and the sort of information that organisations will need to provide to parents, child care providers, the Inland Revenue and relevant national authorities. As I said earlier, it would have to cover the health, safety and welfare of children, including the employment of suitable staff, quality of activities and programmes offered to children and, of course, the security of the children.

Mr. Bercow

Earlier, we talked about simplicity and intelligibility. Perhaps I may press the hon. Lady on specificity, given that she said a few moments ago that the regulations would shortly be available. They are a Pandora's box, which we all wait to see opened. Can the hon. Lady be a little more precise and tell us exactly when we shall be able to focus our beady eyes on them?

Dawn Primarolo

I think I have answered that question—and once the draft regulations are available for scrutiny, I look forward to the hon. Gentleman casting his beady eyes over them and assisting us, both in achieving clarity and with plain English.

The regulations setting up the scheme will be made by the Secretary of State for Education and Employment, and they will be for the specific purpose of extending the range of child care eligible for the child care tax credits.

Mrs. Lait

I am simply asking for information, as the proposals are so important and so new to us. Under which Act will the Secretary of State for Education and Employment make the regulations?

Dawn Primarolo

The power to make the regulations is conferred by the Bill. The Secretary of State for Education and Employment is the relevant Minister. The power to create the regulations is covered by the clause, and the Secretary of State has that power as part of his responsibility for education.

Mrs. Lait

I am sorry to pursue the hon. Lady. Although the power to make the regulations is provided under the Bill, it must surely come under the Department for Education and Employment's own legislation, as does, for example, the legislation providing for the registration of private and state schools, and thereby allowing the Department to inspect. I am asking under which Act of the DfEE the clubs will be registered.

Dawn Primarolo

the Secretary of State has powers to set regulations relating to child care. Clearly, that is under review. I do not have the reference to hand, but I shall be happy to get the information that the hon. Lady seeks. She will understand that the Bill gives the power for the purpose only of tax credits, to extend eligibility for that purpose only, while the Secretary of State completes his consultation on the regulation of child care to fit in with the national child care strategy.

Mr. Pickles

It would be helpful if hon. Lady would give an undertaking to confirm before Third Reading where the authorisation is provided for in statute. If it is any help to her, I think that it is in the Children Act 1989.

Dawn Primarolo

I am grateful for the hon. Gentleman's comment. I am not convinced that he is correct about the reference. He may well be, but, in any case, I am happy to give him the assurance that he seeks. I shall be speaking during the evening, and I shall give the reference to the House, as he requests.

The accreditation scheme will be United Kingdom-wide, just as the tax credits are United Kingdom-wide, but the regulations will be made after consultation with colleagues in Scotland, Wales and Northern Ireland. As is proper for issues relating to regulations for child care, the scheme will be administered separately in Scotland, Wales and Northern Ireland, using a common set of rules which, as the clause makes clear, can reflect specific national or regional needs.

We believe that that is an important extension of the categories of child care eligible for child care tax credit. It fills a practical gap in the current rules, as was clearly identified in Committee and elsewhere. I commend new clause 5 to the House.

New clauses 2 and 3 are grouped with new clause 5. The measures that new clause 2 calls for have already been taken. It calls for us to publish the eligibility criteria, which has been done in the regulations. It also calls on us to publish the conditions for registration as a child minder, which is not for the Treasury or the Inland Revenue to do, but is done by local authorities on the basis of published guidance from the Department for Education and Employment. Therefore, new clause 2 is not necessary.

With respect, new clause 3 looks at the problem from the wrong end. It asks us to publish guidance about the eligibility of people listed in the Children Act 1989 as those who do not need to register as child minders to care for their children, but our rules operate to consider the type of care that is provided and whether it is one of the types that will qualify.

If such people are registered child minders they get over the first hurdle, but further rules prevent the churning of payments within households, which has been referred to in Committee. That obviously stops the abuse, which has so concerned many members of the Committee, and I therefore ask the House to reject new clauses 2 and 3 and to vote for Government new clause 5.

Mr. Pickles

What a pleasure it is to hear the Paymaster General in full voice. She was a little indisposed in Committee and lost her voice, which is a cruel and unusual punishment for a politician, so it is nice to hear her in good voice today.

Dawn Primarolo

It is a pleasure to sit opposite the hon. Gentleman, who always behaves as such. I am grateful for the kind views that he expressed in Committee, especially when he asked me to leave so that I did not give him the flu. That was said, however, with the best of intentions and my recovery was helped by knowing how much he wanted me to get well.

Mr. Deputy Speaker (Sir Alan Haselhurst)

Order. This is all very touching, and I hope that we feel a great deal better for it, but may we return to discussing the Bill?

Mr. Pickles

Indeed, but I am afraid that we are like that, Mr. Deputy Speaker; we are fairly chummy. I can recall—

Mr. Bercow

This is the cuddly Conservative party.

Mr. Pickles

I have no objection to that description.

On the day that the Bill was published, I remember waking to the melodious tones of the Paymaster General, who was on the BBC's "Today" programme. She said, "The really important element for women is the presence of the child care tax credit." So, with some enthusiasm, my hon. Friend the Member for Bognor Regis and Littlehampton (Mr. Gibb) and I reached for the Bill to look for the child care tax credit. Could we find a reference to child care rates? Sadly, we could not. The absence of any such reference was a matter of contention on Second Reading and remained a matter of contention in Committee. The child care tax credit is the tax credit which dare not speak its name.

We were told that it was not necessary to amend the Bill to include the child care tax credit and that everything would be taken care of through regulations, so it is not surprising that we regard the Government new clause as something of a victory, particularly for my hon. Friend the Member for Beckenham (Mrs. Lait), who raised the matter consistently in Committee.

How can we consider how the credit will operate when no regulations have been published and we have no real knowledge of what will happen? We are told that by the time the regulations are published, the Bill will have gone to the other place, which will have the benefit of considering the legislation. Although hon. Members voted yesterday to abolish certain people's membership of the other place, they place enormous trust in them in this respect.

I should have liked to have the opportunity to consider the regulations and to arrive at a conclusion, but I believe that the Conservative Opposition must take some of the blame for this new clause. I asked an official to explain the meaning of it because it was a little unclear, and was told that I should not be surprised that it was unclear as it was part of the panic reaction to our protracted probing in Committee.

5 pm

Many questions remain unanswered. Is it still the Government's contention that the measure will cost £200 million, as they have so optimistically suggested, or will it cost £4 billion, as the Institute for Fiscal Studies has suggested? It remains a question of eligibility and take-up. The new clause seeks to give more regulation-making powers to the Secretary of State to establish a new category of claimant, whose child care charges can be taken into account when calculating entitlement to working families tax credit and disabled persons tax credit.

I had an opportunity to read the memorandum produced by the Inland Revenue, which makes it clear that the Government intend to expand the definition of eligibility to child care for children over the age of eight. As is so often the case, we shall have to wait a long time for the regulations to understand exactly what will happen. We do not know about the new quality assurance measures for those concerned; nor are we clear who will carry out or pay for those inspections. We are told that the trained independent quality assessors mentioned in the memorandum will be the responsibility of the Department for Education and Employment.

We know that registration of child care for children under the age of eight comes under the Children Act 1989 and is the responsibility of local authorities. The Paymaster General said that there would now be two forms of registration: one for children over the age of eight, and another for children under the age of eight. It would be helpful if she would say whether the Government intend gradually to relieve local authorities of their responsibility in that regard. If not, this measure will be a further burden on those authorities.

There remains the question of eligibility and take-up. The current arrangement under family credit operates by way of disregard rather than cash payment. Cash payment is a much more attractive way to receive a credit. It is therefore not surprising that the House of Commons Library has said: The increased generosity of the tax will potentially create a situation in which parents will have a clear financial incentive to obtain registered child care rather than rely on informal networks, such as friends and relatives". The Committee spent a lot of time discussing eligibility. The evidence was conflicting. We know the position with regard to section 71 of the Children Act 1989. In response to a question by my hon. Friend the Member for Bromsgrove (Miss Kirkbride) about whether a child's mother could become a registered child minder, the assistant director of the personal taxation division at the Inland Revenue stated before the Social Security Select Committee: there is nothing to stop anyone, if they can meet the conditions, and it is not for us to make a judgment on that, if they passed the conditions in previous years. On 9 February, the Financial Secretary said: Parents and relatives, including grandparents, can register as child minders, but family credit legislation does not consider payment between partners to be a relevant child care charge. That provision will be incorporated into the rules governing the working families tax credit. I asked the hon. Lady a simple question: was not the difference between what the Government were saying and what the Institute for Fiscal Studies was saying a question of human behaviour? She replied that it was. I have the quotation before me. Does she want me to read it out? I said: Would it be fair to say…that the difference between the IFS estimate and the Government's estimate is a difference in the understanding of the way in which human nature operates? She replied: I understand the point that the hon. Gentleman is making. I would have more regard for it if Opposition Members had made the same points about family credit legislation, but they did not."—[Official Report, Standing Committee D, 9 February 1999; c. 83–85.] I accept the ticking off. She is right, but the point is nevertheless a good one.

The Financial Secretary to the Treasury (Mrs. Barbara Roche)

The hon. Gentleman knows that I would never dare tick him off, but we had a number of exchanges in Committee on the subject. I said that, in relation to behaviour, the determining factor for parents choosing child care was the best interests of their child. That is the key underlying point. That is the message which was sent by Labour Members, not only on Second Reading, but throughout the Committee stage. I am sure that the hon. Gentleman will confirm that.

Mr. Pickles

I still think that that is a yes to my original question. We need to have a look at the potential take-up rate. We know from 1996 Trades Union Congress general council survey that half the women with children below the age of four years work. We know that 16 per cent. are in full-time work and that 33 per cent. are in part-time work. We also know that 78 per cent. of pre-school children regularly spend some time being looked after by some person other than their mother.

It is not unreasonable to say that the IFS estimate of £4 billion is probably wrong—that suggests 100 per cent. take-up. However, the figure for the number of children in the informal care network is about 78 per cent and if we round that down to 75 per cent, the cost of the child care tax credit is probably £3 billion. If grandparents, as the Minister suggested, were used as child minders, 30 per cent. of children would be involved, so the cost would be £1 billion. No matter how we stack up the figures, the cost is considerably greater than the £200 million that the Government are suggesting. The point that the hon. Member for Northavon (Mr. Webb) rightly made is that we should have some suggestion of the sums involved.

There appears to be nothing in the Bill or the suggested regulations to prevent neighbours from mutually looking after each other's children, with both generating child care tax credit and working families tax credit. I cannot see how it is to the benefit of children or the families, or how it helps to get people into work, if we set up a scheme by which people can generate tax credit simply by splitting their child care among themselves.

The Minister must deal with that point and the others that I have raised. She must give an indication of cost. She must say when the various regulations will be ready; otherwise, we are writing more than a blank cheque because the money allocated for working families tax credit will simply be eaten away by a rapid expansion of child care tax credit, on a self-generating basis.

Mr. Webb

It is some weeks since we concluded the Committee stage of our deliberations. The feeling of walking through fog that persisted throughout those deliberations lifted briefly, but has suddenly returned this afternoon when the Paymaster General described the new clause. Throughout the Committee, we asked a series of simple, straightforward questions that were amenable to simple, straightforward answers, but straightforward answers came there none. I feel that we are getting the same thing this afternoon.

I find it incredible that the money resolution relating to new clause 5 has just gone through on the nod, but, when pressed, the Minister was unable to tell us—she could not even tell us the number of zeros—how much money would be spent by the Secretary of State under the new clause. I am astonished that there seems to be no indication of the number of organisations that the new accreditors will have to accredit—whether it is hundreds, thousands or tens of thousands. It is somewhat depressing that the Minister was unable to give any answer to that question.

I reiterate the concerns that have been expressed about the lack of scrutiny. The memorandum that we saw this week says: Draft regulations will be exposed shortly, while the Bill is being considered by Parliament"— viz, not by the House of Commons.

I know that the Government do not have a lot of respect for parliamentary scrutiny of their legislation, but it is deeply distressing that they should table a new clause almost the day before the debate on Report and not produce draft regulations until afterwards. It does not encourage us to feel that the Bill will be properly scrutinised.

Mr. Oliver Heald (North-East Hertfordshire)

Can the hon. Gentleman give any instance of the Government's taking account of the scrutinising role of the House? He says that they do not take much account of it, but they do not seem to take any account of it.

Mr. Webb

There is an interesting contrast between this debate and what happened in Committee, when we were presented with draft regulations that helped our deliberations.

Let me now raise the issue of which form of child care should be subsidised by the state. My party wants to give parents—mothers, typically—choice in two regards. They should be able to choose whether to bring up their children themselves or pay someone else to do it, and if they decide to pay someone else they should be able to choose the most appropriate form of child care. The new clause provides neither of those choices. It offers no financial assistance to a mother who prefers to bring up her children herself, rather than taking paid employment and paying someone else. As the hon. Member for Brentwood and Ongar (Mr. Pickles) pointed out, that could lead to neighbours looking after each other's children, which would be bizarre in the extreme.

The new clause identifies yet another category of state-approved child care; but the second most popular category of child care is provided by nannies, who are no longer the preserve of the rich few but are widely employed, for example, to provide support for mothers who have flexible employment patterns—such as nurses—and who would not be catered for appropriately by registered forms of child care.

We do not think that child care should be subsidised only in the case of certain providers, as the new clause suggests. We want the money to be paid to mothers whether or not they choose to take paid employment, to be spent on the form of child care that they prefer. We want mothers to be able to choose whether to work, and to choose the child care that they want. Regrettably, new clause 5 allows them to do neither.

Mrs. Lait

I hope that the Paymaster General did not think I was persecuting her; if she did, I apologise. I was merely trying to establish the precise meaning of new clause 5, given that, regrettably, there are no draft regulations—as the hon. Member for Northavon (Mr. Webb) and some of my hon. Friends have already pointed out.

At least the Government have finally recognised the problem posed by children aged between eight and 14, and I am grateful for that. Does the provision extend to disabled children of 16, thus plugging a gap in the Children Act 1989?

Dawn Primarolo


Mrs. Lait

I assumed that was the case, but it is as well to put it on the record.

Welcome though that is, some problems remain. The Paymaster General said that only organisations that currently exist, such as breakfast clubs, after-school clubs and holiday clubs, will be eligible to provide child care whose cost can be recovered. As some of my hon. Friends have pointed out, there are many other forms of care for children aged between eight and 14.

Dawn Primarolo

I thought I had made it clear that new providers would not be excluded. The point is that the quality assurance threshold must be reached, and an assessor would make that decision.

5.15 pm
Mrs. Lait

I thank the Paymaster General, but that is not quite what I meant. I took on board her confirmation that there would be room for new entrants into the market. That is, in fact, almost inevitable, as large parts of the United Kingdom do not provide many clubs of the kind that the hon. Lady said would be most likely to be recognised.

We should think more about the provision that children between eight and 14 need. However unstructured breakfast, after-school and holiday clubs may seem, they nevertheless provide a structured set-up which not all children will fit into. Children of that age may want to do other things, but they may still require child care of some sort if their parents work. I may be castigated for saying this, but more and more children enjoy riding. Would pony clubs count as registered child minders, given that they would, in effect, be looking after the children during the day?

Many special interest groups provide child care in that sense, and the Government should consider enabling them to apply and be assessed for quality status. Children between eight and 14 do not want Tonka toys; they are at a crucial stage, when they are exploring possibilities and expanding their horizons. I understand that the Financial Secretary to the Treasury has a child of that age, and I am sure that she will back me up. Indeed, she may be able to advise her fellow Minister on the potential eligibility of other forms of child care.

Might a child minder, or a group of child minders, be a better option? I shall not go into the potential for families to provide child care, but children between eight and 14 may well want one-to-one child care, and their parents may want that as well. To rule out such provision would be short-sighted, and might not benefit children.

A school of thought is emerging in the world of education. As we all know, after a day at school children are tired and their blood sugar is low. In my day, children went home and had tea and sandwiches to raise their blood sugar levels, went out to play and then did their homework. [Interruption.] An interesting dispute is in progress on the Government Front Bench. I suggest that it is best for a child to work off excess energy, or perhaps build it up again, and then do homework before turning on the television. I agree with the Financial Secretary if that is what she thinks. There are different formats and formulae, however. The education world seems to be moving towards the view that a long day of continuous education is not the best way of enabling children to perform properly at school the next day, as well as getting the best from their homework. I completely accept the principle that we should emphasise homework, but I do not believe that the best way of educating our children is to send them straight from school to homework.

There is still a need for diversity in child care for children aged between eight and 14. I am concerned that the new clause would only force children between parallel lines—the last thing that they need is to be forced into one, narrow type of after-school care. As the Bill is being considered in the other place, I very much hope that the Government—who have already re-thought some issues, for which I am grateful, such as our original suggestion that they should broaden the scope of after-school care—will also re-think the different types of child care to which the provisions will apply, so that children aged between eight and 14 might benefit to the maximum from the care that best suits them.

Our amendments would deal with another concern expressed in Committee: who will be able to register as a child minder. The Government have not yet recognised that concern, which perhaps poses a conundrum for them. The issue arose initially from a question in the Social Security Committee from my hon. Friend the Member for Bromsgrove (Miss Kirkbride), who asked: There is nothing to stop mum becoming a registered child-minder? The Inland Revenue official replied: there is nothing to stop anyone, if they can meet the conditions, and it is not for us to make a judgment on that, if they passed the conditions in previous years. The Inland Revenue is effectively saying that there is a loophole, as it would be possible for someone in the family circle to become a registered child minder if he or she meets the local authority's criteria. Although we dealt with the matter exhaustively in Committee, I am not satisfied that that loophole has been closed. One rather suspects that, should the loophole remain open after the Bill is passed, then, before long, test cases will be heard on it.

As I said in Committee, people will act in their own best economic interests. Many people may say, "My best economic interests are served by keeping my child in the family circle, but it would be economically better for us all if a member of my family circle could register as a child minder." The prohibition in the Children Act 1989 would therefore be got round.

Although I laud the Government's belief that people will not change their patterns of behaviour merely because of tax or benefit provisions, I deeply and fundamentally disagree that people will not change their behaviour for those reasons. People will act to maximise their income—which is one of the reasons why the poverty trap exists: some people feel that they will receive more income by staying on benefit, rather than going out to work.

I accept and appreciate that the Government are trying very hard to end the poverty trap, as they have defined it. However, with the very generous benefits that they are providing—we can argue about whether the benefits are too generous—Ministers are effectively encouraging people to organise their affairs so that they maximise their income. I therefore most strongly urge the Government to clear up the confusion over whether a family member may register to provide child care.

I am most grateful that we have made some progress on some of the issues, but hope that the Government will take into account the other issues that I have raised.

Miss Julie Kirkbride (Bromsgrove)

My hon. Friend the Member for Beckenham (Mrs. Lait) very generously mentioned in her speech the contributions made by me and other hon. Members in Committee. She also eloquently raised issues about what is still wrong with new clause 5 and the Bill. I should like to do the same.

My hon. Friend made a good point about whether the Government proposals on carers for eight to 14-year-olds are appropriate. Sadly, it is a long time since I was eight or 14. Nevertheless, I believe that being shoved into an institution may not be the most appropriate form of child care. Many mothers who will be able to claim the working families tax credit will have an incentive to do just that, rather than to let their child stay at home, with gran or with anyone else, although that might have been the most appropriate form of care. My hon. Friend made an interesting point on the fact that an incentive-based system of help with child care will create different priorities for families.

Provision for eight to 14-year-olds will be different from that for other age groups precisely because—as Opposition Members pointed out to the Minister and other Labour Members in Committee—there will be an open-ended public expenditure commitment on the child care tax credit. In the sum required for the credit, there is a vast gap between the Government's figure of £200 million—I think that that is their figure, which was so low that I should be forgiven for adding or omitting a zero—and the £4 billion figure that, as my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) said, was provided by the Institute for Fiscal Studies as the credit's potential take-up. The Chancellor cannot be very pleased with that £4 billion figure.

Even if new clause 5 is added to the Bill, it is still possible that younger children may be eligible to have a child minder—rather than being pushed into institutionalised care, in the kids' clubs envisaged by the Government. It will be a problem if current informal family child care arrangements are affected.

Dawn Primarolo

Has the hon. Lady ever been to a nursery or a kids' club, which she consistently calls "an institution"? Does she agree that mothers in her constituency, like those in my constituency, make their choices solely on the basis of what is best for their children?

Miss Kirkbride

I have been to many of those organisations in my constituency, including pre-schools—which, under the current Government, are closing down in droves, as they can no longer afford to operate. I am very well aware of the arrangements—

Dawn Primarolo

The hon. Lady calls them institutions.

Miss Kirkbride

I used the word in its wider definition. The fact is that they are based not in the home, but somewhere else. If the hon. Lady wishes to dispute semantics, Mr. Deputy Speaker will only call us to order. Children would not be at home, but in another building, which—using a wide definition—could be called an institutionalised form of care. It may be more appropriate—[Interruption.] Forgive me, but there seems to be an awful lot of interruptions by Ministers.

Mr. Deputy Speaker

Order. I simply tell the hon. Lady that if she does not wish to be distracted by sedentary comments, she should ignore them.

Miss Kirkbride

It might be even more appropriate if Ministers were to refrain from making sedentary comments. However, as I was saying before the hon. Lady interrupted me—

Dawn Primarolo

Will the hon. Lady give way?

Miss Kirkbride

No, I shall not. The hon. Lady has already intervened.

Dawn Primarolo

On a point of order, Mr. Deputy Speaker. I did not make any comment across the Chamber to the hon. Lady except for the one that she—

Mr. Deputy Speaker

Order. The Minister knows perfectly well that that is not a point of order but a point of argument. I suggest that the debate settles down and gets back to the substance of the new clause.

5.30 pm
Miss Kirkbride

I was about to close my remarks on the open-ended financial commitment that the Government appear to be making. There is still a problem that the child-minding arrangements for younger children could undermine existing child care arrangements that do not involve the taxpayer. Situations could be created in which people will seek to become registered child minders, creating a commitment and a huge expense for the taxpayer. However much the new clause may be an attempt to reduce the potential financial commitment, we feel that it is not good enough.

Dawn Primarolo

I have nothing to add to my earlier comments. I have laid out clearly the proposals for the undertakings in the accreditation. Perhaps this is an appropriate time to answer the question of the hon. Member for Brentwood and Ongar (Mr. Pickles) about regulation for eight to 14-year-olds and eight to 16-year-olds. Powers are provided for in the Bill. There are no other powers. The Children Act 1989 provides regulation for those up to eight years old. This is the first time that the older age range will be regulated.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

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