Childcare Vouchers

Private Members’ Business – in the Northern Ireland Assembly at 3:30 pm on 24 November 2009.

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Debate resumed on motion:

That this Assembly expresses its concern at the proposed axing of the childcare vouchers scheme; recognises that the loss of these vouchers could have a significant detrimental impact on working parents in Northern Ireland; supports the Employers for Childcare campaign; and calls on the Prime Minister to continue this scheme and to give consideration to the enhancement of Government support for working parents. — [Mr Shannon.]

Photo of Sue Ramsey Sue Ramsey Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. I welcome the opportunity to speak in the debate. My party supports the motion. I take the opportunity to commend gem, I mean Jim, and the other signatories. Maybe he is a gem.

Photo of Sue Ramsey Sue Ramsey Sinn Féin

I commend Jim on tabling the motion and securing the debate. I was in the process of trying to secure an all-party motion, but, fair play to Jim, he got there before me. Nevertheless, I am aware that most if not all parties are willing to support the motion. That shows that, when we work collectively as a team, we can address issues more quickly.

Photo of Jim Shannon Jim Shannon DUP

Although some Members may not have put their names to the motion, through their support today they make it an all-party motion. That is the important thing.

Photo of Sue Ramsey Sue Ramsey Sinn Féin

Absolutely. This is a campaign that all the parties are involved in, and fair play to Mr Shannon and his party colleagues for being quick off the mark. I give credit where it is due. I am trying to commend; I could have taken the huff and said that we would not support the motion.

I take the opportunity to commend the campaigning groups. Sometimes, we lose sight of the hard work that has been done before issues come before the Assembly. Groups have been highlighting this issue, keeping people up to date, informing people and generating a lot of public support. Fair play to them.

The proposal to axe the childcare voucher scheme, which was announced by the British Prime Minister, was a shock to many of us. As Chairperson of the Committee for Employment and Learning, I have taken a keen and active interest in the matter. It struck me that decisions are made elsewhere that can impact negatively on our work.

Earlier, the proposer of the motion, Jim Shannon, highlighted the fact that the proposal was made at the Labour Party conference. There is speculation that the announcement was agreed only two hours prior to the conference. Where are the policy and its outworkings? What impact will that policy have on many people, including working parents? It is important that society and politicians take a keen interest in the matter.

The result of the announcement will impact negatively on working parents. The British Prime Minister said:

“for all those mums and dads who struggle to juggle work and home, I am proud to announce today that by reforming tax relief we will by the end of the next parliament be able to give the parents of a quarter of a million two-year-olds free childcare for the first time.”

Although no one would disagree with that sentiment, its impact raises concern. It is OK to make that statement; however, as it turns out, on the ground, it offered just 10 hours of nursery provision each week for 250,000 children from low-income families and only in England. Once again, that sends out a clear message that children in our communities and constituencies are ignored by the British Government.

It just so happens that the Assembly will later debate the neglect of children and young people. It has had several debates on child poverty. Therefore, rather than making sweeping statements, it is important that the British Government put their hands in their pockets and give us millions of pounds for the public services that they have underfunded. Let the Assembly be the master of its own destiny and deal with poverty, neglect and similar issues, which it discusses daily.

The Assembly must send out the clear message that, if thousands of working parents, the majority of whom are women, and the people whom the Assembly wants to encourage into work through the Department for Employment and Learning, the majority of whom are in low-paid jobs, do not get help with childcare, they will be forced to stay out of work. The Assembly must get it right, especially for working parents, particularly working mothers.

I also want to mention the campaign. I had the good fortune to host our meeting with the group when it visited Parliament Buildings. By chance, I met the Minister of Finance and Personnel outside the meeting. He was unsure about what was happening. If announcements are made in England that will have a negative impact on society here, it is important that the Executive take note.

I ask Jim Shannon to contact the Minister of Finance and Personnel, or, indeed, maybe the Minister could be sent the Hansard report of the debate, so that Members can find out exactly what his Department is doing and whether it will be impacted in any way by Gordon Brown’s recent announcement. I agree that his announce­ment to possibly pull back that proposal seems to be watered down. Therefore, it would be useful for DFP to update the Assembly on whether it is being proactive. In fairness to Sammy Wilson, he was still unsure of the impact of the announcement on people here.

I am conscious that my time is nearly up. Once again, I want to commend Jim — Gem — and the campaign group. I encourage people to sign those letters and keep up the campaign; not only the community but ourselves as political representatives. We must inundate Gordon Brown with letters.

Photo of Sue Ramsey Sue Ramsey Sinn Féin

The Assembly must send the clear message that it wants the money that his Government failed to invest in our public services.

Photo of John McCallister John McCallister UUP

In common with other Members, I support the motion. I apologise to the House if I must leave before the end of the debate. It is certainly no disrespect to the House or to the debate’s importance.

It appears that Gordon Brown made the announce­ment to scrap the existing tax break on employer-provided childcare vouchers at the Labour Party conference, without consultation with employers, working parents or the devolved Governments of the United Kingdom.

I have some sympathy with the reasons that the Prime Minister gave for scrapping the scheme. His intention to give free childcare to 250,000 low-income families in England for the first time is commendable. However, the actions that he intends to take to deliver that outcome are indefensible and will do untold damage to hard-working parents throughout the United Kingdom, especially in Northern Ireland. I note that the 250,000 free places referred to by the Prime Minister are, as Ms Ramsey mentioned, for England only. That means that the Prime Minister will be stripping some 10,000 working parents in Northern Ireland of their tax exemptions, without anyone else benefiting.

Secondly, Mr Brown’s reason for scrapping the benefit — that it is badly targeted — suggests that middle-class families who can afford childcare are the main beneficiaries of the scheme. However, that ignores research which suggests that the majority of users of the scheme are basic-rate taxpayers. Middle-income, hard-working families who are just above the threshold for means-tested benefits will lose most. It is clear that the Prime Minister’s argument is deeply flawed.

The vouchers are also of major benefit to local nurseries and child-minding groups in Northern Ireland. The flexibility of the current scheme means that parents can gain places for their children in nurseries close to their homes or places of work. If the Prime Minister goes ahead with his proposals, the ramifications of his actions will be far-reaching. Removing the benefit is likely to have a greater impact on women, who bear the main childcare responsibilities, and, therefore, it will potentially increase the gender pay gap. There is a danger that mothers will not return to work after maternity leave, which means that businesses will lose experienced employees. When one takes a step back, it becomes clear that the economy will lose out at a time when it can ill afford to lose any part of its workforce.

There is also a danger that families in which both parents work and who are just above the benefit threshold, will be forced to claim benefits if one parent drops out of employment to look after the children. Any savings that the Prime Minister hopes to make with this initiative could be lost due to extra benefit uptake. That will also put paid to the message that it pays to work. The Labour Party is again about to penalise people who want to provide for their families by suggesting to them that it will be more affordable to stay at home. That is bad for the economy, bad for families and bad for public finances.

There has been much speculation of late as to whether the Prime Minister will make a U-turn on this issue. There has been talk of raising the threshold to ensure that middle-income earners are not discriminated against. I would welcome such a decision by the Prime Minister; yet there has been no concrete evidence to back up those rumours.

I welcome the opportunity to take part in the debate. I want the Assembly to send a clear, strong and united message to the Labour Government that they have not taken into consideration the needs of Northern Ireland and that they are fundamentally wrong on this issue.

Photo of Mary Bradley Mary Bradley Social Democratic and Labour Party

I support the motion. Too often, we find ourselves having to defend the retention of benefits that directly affect the vulnerable. In this case, a vulnerable group that is mostly forgotten about will be directly affected. I refer to the working poor.

In too many instances, the working poor are kept outside the benefit arena because they are working and attempting to make life better for their families and themselves. They are also helping to build the economy. However, for that, they are punished financially, and we see the Government chastise those who work. It becomes more and more apparent that the Government are not interested in encouraging parents to work.

We are told day and daily about how much inactive benefit recipients are costing the economy and how important it is that people with jobs continue to work so that the economy can be repaired and rejuvenated. However, many of my constituents who have concerns about the withdrawal of childcare vouchers have said that, if the scheme is withdrawn, one or both parents will either have to give up their employment or at least reduce their hours of work, which will equate to less money coming in, thus creating a poorer household.

More importantly, if one parent leaves work, the likelihood is that the other parent’s salary would still mean that the family could not claim for benefit assistance. However, if a single parent were to leave work, he or she would have to resort to benefits, and the income from those benefits would probably leave a substantial gap between his or her salary and his or her benefit income.

Last week, the House unanimously supported a legislative consent motion on the UK Child Poverty Bill. However, just seven days later, we are discussing the withdrawal of childcare vouchers by the same Government who deemed child poverty to be a scourge on society. The Government are trying to allay the furore by stating that the removal of childcare vouchers will be phased over the next five years and that they will be replaced by a scheme extending free nursery places to more than 250,000 two-year-olds from low-income families. However, we must remember that that applies only in England and Wales. What about Northern Ireland? There are no guarantees for Northern Ireland that that money will be redirected into early years education or other schemes. Therefore, we will be hit with a double whammy.

It has been reported — I have no doubt that this is accurate — that middle- or lower-income families benefit most from the scheme and that the hardest hit will probably be people such as nurses, whose only option will be to leave the Health Service. Local pressure groups have made their voices heard, and we need to support them.

My colleague and party leader, Mark Durkan, in his capacity as MP for Foyle, has tabled a ChildcareSOS motion in the run-up to the pre-Budget report. That motion was signed by 88 MPs and has been resubmitted to put pressure on the Government to stop their plan to cancel childcare vouchers.

We must not forget that the removal of the voucher system will adversely affect not only working parents but the many nurseries and childcare facilities that accept the children of working parents. In effect, it will create a “rob Peter to pay Paul” scenario. As a public representative, I am inundated each year with complaints from working parents whose children cannot get into a nursery class as most of those places are taken up by the children of parents who are in receipt of benefits. Although benefit-dependent families certainly need help, there must be equality in the treatment of all citizens. Working families all too often get left behind when financial aid packages are being distributed. The UK seems to be becoming more and more isolated in the EU, while other member countries seem to assist working families in order to maintain their economy base and encourage economic stimulation.

The abolition of vouchers is such a bad move that even the Labour Party’s own MPs — in particular, the female MPs — are extremely worried about the withdrawal of the scheme and have apparently voiced their concerns privately to Gordon Brown.

I view the removal of the scheme as an attack on families, on women and, most shockingly, on children, because the parents who either cannot afford childcare or who do not want to claim benefits will look for cheaper childcare. In fact, they may be forced to employ childminders who are not even registered, which would be a recipe for disaster. People who do not have family members who are able or, indeed, young enough to mind their children face a scary situation. Children and their needs are being sidelined on an agenda of proposed savings that will be exposed as a false economy.

Photo of Mary Bradley Mary Bradley Social Democratic and Labour Party

I hope that there is a positive conclusion to this mess. The House must unite in its objections to the issue.

Photo of Basil McCrea Basil McCrea UUP

Will the Member give way?

Photo of John Dallat John Dallat Social Democratic and Labour Party

The Member’s time is up. You missed the boat, Mr McCrea.

Photo of Anna Lo Anna Lo Alliance

I support the motion and thank the Members who tabled it. The withdrawal of childcare vouchers is another of Gordon Brown’s half-baked ideas. We need to send a strong message from this House saying that we oppose the proposal because it will not help our economy or our hard-working families.

Northern Ireland has the highest level of child poverty in the UK, and research has often shown that one way of getting out of poverty is to help parents get back to work. The proposal is not going to do that. Further, Northern Ireland does not have a childcare strategy; that is still sitting in OFMDFM as it debates who is going to be responsible for childcare in Northern Ireland. Also, we still do not have an early years strategy to help young children.

For parents, there are enormous difficulties getting quality, accessible and affordable childcare. Therefore, why is anyone talking about trying to scrap a scheme that is working? Parents in Northern Ireland also have great difficulties getting registered childminders. There has been a decrease in the number of registered childminders rather than an increase. Scrapping childcare vouchers will only hamper the development of the childcare sector.

Axing the childcare voucher scheme will affect around 10,000 working parents here, most of whom are basic-rate tax payers and are not, as some people think, rich parents who can cream something off the system. Mostly, they are hard-working middle-income families that are just on the threshold for means-tested benefits. Those families are going to be caught in the dilemma between staying on at work to pay for childcare, paying enormous sums if they have a number of children, and giving up work and staying at home.

MPs at Westminster have raised the question of capping the childcare voucher system at a given level so that undue benefits do not go to parents on higher incomes. That is a much more sensible way of dealing with the issue, rather than having a blanket ban on the whole scheme.

Photo of Lord Maurice Morrow Lord Maurice Morrow DUP

I welcome the fact that the motion appears to have universal support in the House. That in itself sends out a powerful message on the issue.

There have been some startling headlines, in the local press and elsewhere, in relation to the matter. One paper carried the headline:

“100,000 will lose childcare vouchers; Middle class miss out despite Brown U-turn”.

It was reading headlines such as that and meeting those who came to Stormont — ironically, on the same day that Prime Minister Brown was here — that prompted Jim Shannon, Simon Hamilton and me to go forward with the motion.

As I said, I am thankful that the motion has met with universal support. Indeed, some Members said that had we not tabled the motion they would have done so themselves. Others said that it would have been better had it been tabled as an all-party motion; however, as the motion has received all-party support, I take that to mean the same thing.

One of the issues around childcare support is that, typically, a full-time place in a private day nursery costs approximately £650 a month. That is a fair slice from any pay packet or salary.

I suspect that, apart from a mortgage payment, £650 for private childcare will be largest outgoing for any family. Working-class families and those who earn just above the average salary can hardly afford such an outlay. They will welcome that the Assembly has taken that on board and is aware of the pressures and worries that are being inflicted on working-class families across Northern Ireland.

Alas, the Government of the day do not seem to care too much. Although this Assembly is often noted for its negative aspects, it can send a positive message to the whole community and Gordon Brown’s Government by saying that it is united in its support for the retention of the childcare voucher scheme. However, can we be sure that Mr Brown is listening? He seems to speak with a forked tongue on the issue.

The scheme was introduced by the Labour Government and Mr Brown, so is it not ironic that he is the one putting it under threat? That policy is from a supposedly socialist Government who are allegedly looking after working-class people. All the parties in Northern Ireland are better skilled in looking after the working-class people of Northern Ireland than any Labour or Conservative Government. I hope that our colleagues in the Ulster Unionist Party take cognisance of that, because they have hitched their wagon to the Conservative Party.

I was delighted that John McCallister was able to support the motion. I hope that he lets his new leader, Mr Cameron, know that the Conservative Party is at odds with its local wing here on the issue. I have my doubts about whether Mr McCallister’s boss in London, Mr Cameron, will be too concerned about working-class families. However, we will leave that for another day and not fall out about it.

Photo of Lord Maurice Morrow Lord Maurice Morrow DUP

The Member can take it from me that he has two party leaders. I am sure that he will not let the issue go unnoticed by either Mr Cameron or Mr Empey, whoever he prefers, and will constantly bring to the attention of one of them the importance of retaining the childcare voucher scheme.

Photo of John Dallat John Dallat Social Democratic and Labour Party

Will the Member bring his remarks to a close?

Photo of Lord Maurice Morrow Lord Maurice Morrow DUP

Yes, I will. The good news that we are sending from the Assembly is that we are totally united on the issue and want the retention of the childcare voucher scheme.

Photo of Paul Butler Paul Butler Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. Tá áthas orm tacaíocht a thabhairt don tairiscint seo inniu. As other Members have said, there is all-party support for the motion. We should, as best we can, try to keep party politics out of our discussion on the issue. As some Members said, the proposed ending of the childcare voucher scheme is another ill-conceived and ham-fisted proposal from Gordon Brown. He clearly has not thought out the ramifications of the policy and how it will impact on families. As has been said, the notion that families here will benefit from the redirection of money is wrong: the 250,000 free childcare places will be in England, so working parents in the North will not benefit from them.

Gordon Brown is feeling a lot of heat from his own party on the issue. Many Labour MPs and ex-Ministers are giving him a hard time about the policy and rightly so. We need to send out the message that the Assembly is totally opposed to abolishing childcare vouchers, because we were not even consulted. The proposal is a populist one from Gordon Brown to try to win the next election, and it has not been thought out properly. Gordon Brown is trying to bring in the proposal while telling us that he will regenerate the economy and create more jobs; yet parents, childcare providers and businesses are the three groups that will be most affected by the policy.

Parents, particularly mothers, will have to give up employment. That will widen the gender gap and bring about more inequality for women, because parents will not both be able to work.

Businesses will suffer. Some of the material from the Employers for Childcare’s vouchers campaign outlines that childcare vouchers are one of the most popular employee benefits in the country. In the current economic climate, businesses survive because people are in stable jobs. However, those people benefit from childcare vouchers and use them to place their children in childcare. The proposal will also affect childcare providers, because it will remove a key source of income from them. It will lead to unregulated practices, with people placing their kids in the care of unregistered and unqualified childcare providers. Gordon Brown has got it wrong for parents, employers and childcare providers.

As Jim Shannon, Sue Ramsey and other Members said, Gordon Brown must listen to the Assembly and reverse the decision. He must keep this sought-after benefit in place so that both parents can continue to work. As Lord Morrow said, it is a misconception that childcare vouchers are a middle-class benefit. They are not; people on lower incomes will suffer if they are scrapped.

Photo of Iris Robinson Iris Robinson DUP 4:00, 24 November 2009

Does the Member agree that if the Government were to stop benefits simply because they also reach middle- to upper-bracket earners, no one would receive those benefits? It is a bogus excuse.

Photo of Paul Butler Paul Butler Sinn Féin

Yes; I agree entirely with the Member. The notion that other people will benefit is ill-conceived, and what Gordon Brown is trying to tell us is wrong. I hope that, in the coming days, Gordon Brown listens to the Assembly and its clear message that we want to retain childcare vouchers for parents and childcare providers and for businesses, which are trying to survive in the economic climate.

Photo of Michelle McIlveen Michelle McIlveen DUP

At the stage of the debate when everyone is in agreement, there will be a certain amount of repetition. However, that does not mean that the points should not be stated over and over again.

When the Prime Minister first proposed to abolish the tax relief that employees receive for childcare, the public was, quite rightly, outraged. Given that the replacement for the scheme will not extend to Northern Ireland, that outrage was more acute here. At the Labour Party conference, the Prime Minister said that, in its place, the Government would provide free early education and childcare places for 250,000 two-year-olds in England. Incredibly, Gordon Brown is proposing to scrap a UK-wide scheme and replace it with a scheme that applies in England only. That represents a potential loss to the Northern Ireland economy of a minimum of £8 million.

As Members have said, the vouchers enable working parents to make significant savings on childcare costs. They can opt to receive up to £243 of their pay in vouchers each month before income tax and National Insurance is deducted. For many families, the receipt of that amount of childcare, which is free of income tax and National Insurance contributions, through the scheme is an important means to allow, primarily, mothers to work. Members who spoke previously said that we should not forget that, even in today’s society, which talks so much about equality of the sexes, the biggest impact of the proposed scrapping of the tax relief will be on women and their ability to work.

A question must remain about whether the effect of the proposal amounts to indirect discrimination. Like other Members, I have been contacted by many constituents about the matter. One constituent, who has two very young children and benefits from the childcare vouchers, told me that if the scheme is withdrawn, it will be impossible for her and her husband to both continue to work. As my colleague Lord Morrow said, such a decision will be felt deeply here because of the recognised need for quality low-cost childcare places.

Fortunately, the Government appear to be back-pedalling, which is somewhat justified, given the anger that has been expressed. It seems incredible that it should ever have been contemplated in the first place, given the current economic crisis and the fact that such a measure would have had a negative effect on a significant section of the workforce.

Photo of Jim Shannon Jim Shannon DUP

Michelle McIlveen, Simon Hamilton and I wear different hats, as councillors on Ards Borough Council. Recently, council officers asked the council to endorse their opposition to the removal of childcare vouchers. That illustrates the depth of dismay and concern that exists in the Province on this issue.

Photo of Michelle McIlveen Michelle McIlveen DUP

I thank the Member of his comments, and I reiterate them. The only difficulty that I have with the Government’s U-turn is that the soft words of Ed Balls on the subject seem only to hint at a partial compromise, by saying that it is good for the Treasury to listen. My guess is that it is more of an L-turn than a U-turn. It appears that it was more the threat of a further Back Bench revolt by more than 50 Labour MPs that has spurred things on. I doubt that the boast of closing the Tories’ poll lead would last much longer if the Labour Party were once again to be seen in disarray.

Of course, we simply do not know who the Treasury is listening to, or whether Northern Ireland will continue to be left out of the reckoning when it comes to addressing the issue. We wait with bated breath to hear what the Chancellor will say in his pre-Budget speech on 9 December, but it is necessary for the Assembly to lend its voice to the protests against the current proposals to scrap the childcare voucher scheme. I am proud to support the ChildcareSOS campaign, which is led by Employers for Childcare, and I am more than happy to support the motion.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I concur with Lord Morrow; there is universal support in the Chamber for the motion. I acknowledge Jim Shannon’s contribution as the proposer of the motion. He has again demonstrated that he has a good feel for the public good and for the causes of anxiety in the wider community.

As a middle-aged parent of two children under four years of age, I have some appreciation of the need for childcare. I would miss the childcare benefit that I get as an MLA under the Assembly’s childcare allowance scheme. However, given my income level and the fact that my wife and I are working parents, our benefit is so much less in the grand scheme of things than the benefit for those on much lower incomes, especially lone parents, of having the childcare allowance scheme.

Photo of Mickey Brady Mickey Brady Sinn Féin

Does the Member accept that on this issue, the British Government have demonstrated their ability to be both disingenuous and contradictory? With the introduction of employment and support allowance, lone parents in particular are being targeted and pressurised into going back to work. The rules relating to being at home to look after children of a certain age have changed. The age limit has dropped from 16 years to 12 years. It will reduce to 10 years and eventually to one year.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I appreciate the point that the Member makes, but those matters have been discussed previously in the House and, no doubt, will be in the future. I will address the point of contradiction in the Member’s intervention shortly, but I will return to my speech.

Perhaps it was an unfortunate moment to ask for an intervention, but the critical point that I wanted to make is that as a working parent on a much better income than many working parents, I can appreciate, as other parents here and elsewhere can appreciate, the needs of those who are in receipt of childcare vouchers. As Members have properly outlined, there are thousands of people on much lower incomes than me and many others, who, if it were not for the availability of the scheme, would be putting their income and their ability to go to work in jeopardy.

We all know what the Member was getting at when he made his unfortunately timed intervention. It was a quite inappropriate intervention, given that there is unanimity in the Chamber on this issue. I hope that the Member will reflect on that. However, he made one accurate point, which is the contradictory position of the British Government. The British Government cannot, on the one hand, table legislation on targets to deal with child poverty until 2020 and at the same time propose to withdraw childcare vouchers. Offering people childcare support to help them to get back into work is one of many mechanisms that need to be in place to deal with child poverty.

If the Member was correct, he was correct in only one regard, which is that there is a contradiction between the British Government’s legislation on child poverty and their proposal to withdraw childcare vouchers. One cannot have it both ways; that sends out mixed messages and creates anxiety among working families and parents. The British Government should reflect on that.

However, there is a wider obligation on this Chamber, which may prove to be a deeper contradiction. If we are to deal with child poverty, and childcare vouchers are only one mechanism of that, in the next Budget or Programme for Government we must put in place resources and strategies to deal with childcare and child poverty, so as not to leave us open to the same charge of being contradictory as has been levelled at the British Government.

We must put meat on the bones of the childcare strategy. Ms Lo rightly pointed out that there is a lack of childminders in the North, and that has been amply demonstrated by organisations such as NICMA. A lack of childminders in the North means that there is a lack of people on whom working parents can spend childcare vouchers.

We have to fix that problem, and part of doing so is to put in place the now long-overdue childcare strategy. We have been promised that the strategy will come before the Assembly, and there is a ministerial subcommittee dealing with it, but we have not yet seen the meat on the bones of that strategy, which everyone endorses. Without that, we are failing working parents in the North by not ensuring that we have sufficient childcare provision and an adequate numbers of childminders.

The debate has been a healthy one, although it was unnecessary, wrong, absent-minded and foolish to try to introduce a discussion about wider issues.

Photo of Claire McGill Claire McGill Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. I support the motion. Many of the key points have been covered at this stage of the debate.

The comments from Lord Morrow about working-class parents were valuable. The motion refers to working parents, and having listened to the contribution from Mr Attwood, I have some sympathy with Gordon Brown in his intention. [Interruption]

Sorry, I just want to make this point. My colleague Paul Butler made the point that, rather than the problem being Gordon Brown’s intention, the problem is the outworkings of his proposal. I could be wrong, but I believe that he wants any new scheme to be targeted at parents who will have serious difficulties if the childcare voucher scheme is axed.

As Mrs Robinson said, that does not mean that others cannot benefit. Mr Attwood underlined that it is working- class parents who will suffer serious problems. It will be detrimental in a big way for those people, particularly lone parents who have serious childcare problems.

I wish to refer to two reports that were published in 2009. A Committee for the Office of the First Minister and deputy First Minister report on the gender equality strategy described childcare provision here as being the worst in western Europe. Therefore, there is a problem with childcare provision. A report titled ‘Women Living in Disadvantaged Communities: Barriers to Participation’, which was commissioned by the Women’s Centres Regional Partnership, highlighted lack of childcare provision as the biggest single barrier to women’s engagement in education, training and work.

I reiterate the comments that my party colleagues made about the outworking of the Prime Minister’s intention to scrap the childcare vouchers scheme. Gordon Brown is wrong to propose the axing of that scheme. The ramifications and implications of his proposal have not been fully analysed. However, a message of cross-party support for the motion will be sent from the Chamber today. I commend Jim Shannon and his colleagues for bringing the motion to the House, and, as my colleague Sue Ramsey said, our party fully supports it.

Mary Bradley referred to the legislative consent motion on the Child Poverty Bill, which was debated in the Chamber on 16 November 2009 and about which we spoke at length. The contradictions are ironic, because there has been no consultation with the devolved institutions here on the matter. We must think of those who are most in need, and of working-class parents in particular. It is wrong that those people will lose out. I fully support the motion and the sentiments that have been expressed in the debate.

In January 2009, the ‘Belfast Telegraph’ quoted a study that calculated that it costs £9,227 a year to rear a child from birth to the age of 21.

Photo of John Dallat John Dallat Social Democratic and Labour Party 4:15, 24 November 2009

I ask the Member to draw her remarks to a close.

Photo of Claire McGill Claire McGill Sinn Féin

How can working-class parents afford that? Furthermore, what if they have more than one child? That is a real problem. Go raibh maith agat, a LeasCheann Comhairle.

Photo of Iris Robinson Iris Robinson DUP

I support the motion and congratulate my colleagues for bringing it to the House today. The motion is timely and addresses an issue that is very important to our constituents. Scrapping the childcare vouchers scheme will directly affect families who are in the low-income bracket. Gordon Brown and, indeed, his predecessor, Tony Blair, have done enough to destroy family life and the family unit in the United Kingdom without adding insult to injury. The realisation of the Prime Minister’s intention to scrap the scheme would be utter folly, and it would have a devastating effect on low-income families.

The scheme was introduced in April 2005 to help parents to make a contribution to childcare through tax relief. Under the scheme, up to £55 a week, or £243 a month, goes towards paying for registered childcare. Although it is a tax-relief scheme, parents put aside up to £243 of their salary every month in exchange for electronic vouchers that are used to pay for childcare.

The scheme is a great help to the 340,000 working parents across the UK who benefit from it. The argument that the Labour Government sought to use to support scrapping the scheme was that it benefited the people who could afford it. However, the Government’s own figures dispute that. They show that 92% of voucher users are from low and middle-income families. Therefore, the evidence supports the need for the scheme to be retained, given that it is doing what was intended, which is to help working parents.

As I said to the Member on the opposite Benches, if we are to use the Government’s guidelines, no benefits would be paid out. That is because we would always be above the cut-off line that the guidelines suggest, meaning that middle-class and upper-class persons would be able to benefit. We must also remember that those parents probably contribute a great deal through the taxes that they pay. Therefore, I would not be seen to deny them their right to have that benefit if they are on a parallel to receive it.

When Gordon Brown first mooted scrapping the scheme, my office was inundated with queries. I am sure that many Members experienced something similar. I have never seen such a flurry of activity in my office than that in the aftermath of the realisation of what scrapping the scheme could mean to low-income families. I received many letters and phone calls, and parents came to the office with their children in buggies. There was literally a line of people at my constituency office in Newtownards. I wrote to the Prime Minister to voice my opposition to his very poor and ill-thought-out plan. I must say that I am still waiting for a reply. I can only assume that he was swamped by a deluge of mail from irate Members of Parliament, Members of the Assemblies across Scotland, Wales and Northern Ireland and by the electorates of those bodies.

Today is a good day because we can see the depth of support for the motion across all parties in the Chamber. We can send a message to Gordon Brown saying that the situation is not acceptable. The Government should accept that they really have got this one wrong. They will have to do a U-turn, just as they have had to do many times before.

Photo of John Dallat John Dallat Social Democratic and Labour Party

The Member should draw her remarks to a close.

Photo of Iris Robinson Iris Robinson DUP

I do not think that it is asking too much to ensure that low-income families in particular get the help that they need to get back to work, given that that is what this Government have been trying to achieve. They want to get people out of the benefit culture and back into the workplace.

Photo of Mervyn Storey Mervyn Storey DUP

I apologise to the Members who proposed the motion for my absence for part of the deliberations this afternoon; I was involved with other duties in the House. However, as the Chairperson of the Education Committee, it is important that I put on record the steps that the Committee has taken since it was lobbied by Employers for Childcare. Indeed, many Members mentioned that. I pay tribute to the excellent way in which that organisation brought this matter to Members’ attention. Those who have received the most up-to-date briefing from ChildcareSOS are indebted to that body for the way in which it has approached this issue.

The Education Committee considered the con­sequences of the Government’s announcement to axe the childcare voucher scheme. Having received the Employers for Childcare campaign document, we asked the Department of Education for a detailed response to the issues that were raised. That process proves the value of this Assembly’s Committee system. This issue is of importance to so many people and impinges on so many families, and a process was put in place that brought about a degree of clarity and allowed some useful information to be given.

The Department’s response was useful, for it clarified the Government’s plans while making the point that the Department of Education has no policy link to proposals for tax and benefits for parents and their employers. The Department would not have expected the proposals to have a direct impact on the number of preschool childcare places.

On that subject, the Department of Education emphasised that the Government’s original announcement stated that the money generated from the change would be used to provide free childcare for families on lower incomes in England, which is a point that several Members made. In Northern Ireland, however, as Members also pointed out, OFMFDM is taking the lead on work on access to childcare, and there will be public consultation on a new childcare strategy, which will apply to all 0- to14-year-olds.

Of course, we are still waiting on the Department of Education’s proposals for a strategy for 0- to six-year-olds, which is an issue for the House, because we often aspire to having joined-up government and to ensuring that Departments’ policies are linked. In this case, it is vital that the Department of Education, in consultation with other Departments, have a clear policy on dealing with all facets of childcare provision in Northern Ireland.

On 15 November 2008, the Secretary of State for Children, Schools and Families said that the United Kingdom Government were in “listening mode” over concerns about the abolition of tax relief for childcare vouchers, and Employers for Childcare has given that statement a cautious welcome.

Speaking as a Member, rather than as the Chairperson of the Committee for Education, like other Members, I have been approached in my constituency office by parents who make an invaluable contribution to the Northern Ireland economy and who, despite all the challenges and difficulties, endeavour to provide for their children. I was surprised by how important those parents consider this issue to be. For them, the bottom line was that if childcare vouchers were not available, it would be increasingly difficult, if not nigh impossible, for them both to continue working.

Photo of John Dallat John Dallat Social Democratic and Labour Party

The Member should bring his remarks to a close.

Photo of Mervyn Storey Mervyn Storey DUP

The Member for Strangford gave an example of the benefit and coherence that such a scheme brings to family life.

I support the motion, and I am glad to have been able to speak on behalf of the Committee for Education.

Photo of Dawn Purvis Dawn Purvis PUP

I thank my colleagues in the DUP for tabling the motion. When we heard about the Government’s plans to phase out the childcare voucher scheme, Sue Ramsey, Naomi Long and I drafted a cross-party motion along similar lines, so I am happy to support the motion.

I sincerely hope that the objective of the motion — to save the childcare voucher scheme — has already been achieved and that we are merely validating the Prime Minister’s decision not to scrap such a valuable programme. Like others, I was shocked when the Prime Minister announced that he would end the childcare voucher scheme and redirect the resources to nursery provision for two-year-olds in England. When the Prime Minister was here some weeks ago, I raised the issue with him directly and, like Claire McGill, he was concerned that vouchers were being used in England and Wales for skiing lessons, ice-skating lessons and horse-riding lessons.

Photo of Sue Ramsey Sue Ramsey Sinn Féin

I know that that is an issue. However, we need to ask why those who are on benefits should be penalised rather than targeting those who are allegedly making money on the scheme. I do not think that anyone would disagree with such an approach.

Photo of Dawn Purvis Dawn Purvis PUP 4:30, 24 November 2009

I thank the Member for her intervention. I was going to come to that point. She is exactly right. Although any additional assistance for the parents of young children is to be welcomed, programmes for children in England cannot be introduced at the expense of those in Northern Ireland. Rather than robbing one programme to fund another, the Prime Minister should be supporting both.

The nursery provision that he was heralding in England, to which Members have referred, offers extremely valuable early childhood development services. I would like to see more of that in Northern Ireland, particularly in disadvantaged communities. However, we are not trading like for like. The types of nursery placements that the Prime Minister is proposing for two-year-olds for ten hours a week — essentially two hours a day — will offer a real boost to the children who participate in them and meaningful support for their families, but such programmes cannot possibly be classified as childcare. I struggle, as I am sure many others do, to think of any lucrative employment that any parent could secure at less than ten hours a week.

In Northern Ireland, we are in a particularly vulnerable position on the issue and cannot afford to lose childcare programmes in any form. We are already dealing with woefully inadequate childcare provision, unable to meet current demand for services. The situation is getting worse: the number of childcare places is actually falling. Despite that, our Executive have been slow to move on the issue. We continue to wait for a national childcare strategy and for a Department that is willing to take responsibility for that critical issue. To lose childcare vouchers in such an environment would be a serious blow.

The evidence is irrefutable that the primary barrier to women’s full participation in education and employment is childcare. As Claire McGill outlined, the impact on women from disadvantaged communities is particularly profound. Women who have children at home and who want to work cannot do so if they do not have access to appropriate, affordable, quality childcare; it is as simple as that.

The effect of this issue really knows no social or economic boundaries. The lack of appropriate childcare poses a major stress in many households. Childcare programmes must meet the needs of the families that they are supposed to support, and the childcare vouchers scheme is perfectly matched to meet the needs of those who use it. The Government’s attempt to frame their decision to remove the scheme as an attempt to shift resources to low-income families is insincere. If the Government were indeed committed to supporting the most vulnerable families, they would not be forcing single parents onto jobseeker’s allowance on the one hand and taking away support for childcare on the other. It is either very poorly co-ordinated or very poorly thought-out policy, but the end result could easily be an impossible choice for many parents: hardship in work or hardship out of work. A large number of parents will have to decide whether they can actually afford to work simply because of the cost of childcare.

In Northern Ireland, we are paying the price for having marginalised the issue of childcare for so long. We have failed to fully appreciate its impact on our society and economy. If the recession brings anything good, perhaps it will be a better understanding of the support and flexibility that working families need, not only to pursue a career and raise a family but simply to make ends meet.

I am delighted by any investment in early childhood development, but diverting funds away from a successful and critical scheme to support working parents is not the way to do it. I support the motion.

Photo of Simon Hamilton Simon Hamilton DUP

About halfway through the debate, Michelle McIlveen said that everything had more or less been said at that stage, so the chance of me saying anything different at this juncture is very limited. However, I welcome, as other Members have done, the widespread support for the motion that has been shown across the Chamber; unanimous support has been shown by Members on all sides today. I hope that that is some encouragement to those who would be most adversely affected by any change in tax relief or childcare vouchers. I hope that those people who fear the worst will see some encouragement in their representatives in the Northern Ireland Assembly speaking up for them with one voice.

I will touch on some of the broad themes that have been drawn out by Members’ contributions. The first consistent theme relates to the nature of Gordon Brown’s announcement. We all get bright ideas, and we get them in weird and wonderful places, but, after a while, we realise that they may not be as good as we had thought. However, most of us do not go to a party conference, which is being broadcast on national television, and blurt out the idea without any thought, background work or analysis. That appears to be what the Prime Minister has done in this instance.

Nobody will disagree with some of the motivation behind what he is saying. I think that there might be a hidden agenda to what he said, but, on the face of it, it is not a bad thing to try to amend policy and divert resources to offer free childcare for 10 hours a week for every two-year-old in England, but the unforeseen or foreseen consequences of that for others are widespread. There will be consequences not only for people in Northern Ireland, Scotland and Wales; the scheme will not be much good for people in England if their child is not two years old. The scheme will not be much good to anyone who needs childcare or assistance with childcare for more than 10 hours a week, which is required in most cases. The scheme is not good for everybody in England, and it is certainly no good for people in Northern Ireland. There is a lot of opposition to the mechanism of the change and its consequences.

I do not entirely subscribe to the view that the Prime Minister did not do his homework. I think that an opportunity was seen in the run-up to an election to try to throw out a populist line, which, on the face of it, looked good but, in reality, was not. Members should factor in that the announcement was made at a Labour Party conference. It was an old-fashioned, outdated, soak-the-rich type of mantra that one would expect from socialists, and it was thrown out by the Prime Minister to try to pacify itchy, nervous members in his party.

The consequences, particularly for Northern Ireland, are widespread. As all Members who spoke in the debate have identified, the proposal will hit low-income families and low to middle-income families most severely. There is social division in Northern Ireland, but it is not as acute here as it is across the water. We have a broad swathe of individuals who fit into that low- to middle-income bracket, perhaps because of the predominance of the public sector in Northern Ireland. Therefore, it is likely that the proposal will affect us more than it will affect others.

I want to stand up for those people in the low- to middle-income bracket, who always seem to be most adversely affected by changes in the tax system or whatever else. They always seem to bear the brunt. In relation to other policy areas, the Assembly has tried to stand up for those people and consider their incomes; when debating the rates system, for instance. It does no harm to stand up and say that those people have taken too big a hit through the years and that sometimes they need a bit of help. Childcare vouchers are one way in which they were getting help.

A lot of Members talked about the success of the existing scheme. In a country where the average childcare costs are about £600 a month, we have a scheme that allows an annual relief of around £1,200 for an individual or twice that amount for couples. We are not talking about a lot of money. If someone is spending an average of £600 a month on childcare, such an annual saving will not make a big dent, but it will make a big difference. It is not a massive amount of money, but it is a major contribution for many people.

Members have said that some 10,000 parents in Northern Ireland are availing themselves of the vouchers. The vouchers allow parents to get into the workplace and make a contribution to society, because for many of those people, childcare is a key consideration.

Mr Attwood declared his interest as a middle-aged father of two children under four years of age, and I can declare my interest as a young father of two children under four years of age — [Interruption.] It must be the sleepless nights. [Laughter.] I know and appreciate that not everyone is as fortunate as my wife and me, in that our parents — the children’s grandparents — are fit and active and able to help out. Not everyone is in that position: the grandparents may not be with us any more, or geography may have an impact. Childcare vouchers have allowed people without such support to get into work and make a contribution to society.

It is little wonder that fewer women are economically active here. There is a difference of some 5% between men and women’s economic activity rates in Northern Ireland, even when we take into account the recent substantial changes in the labour market.

During today’s debate, many Members have called for the creation of a childcare strategy. I do not want to get into the detail of that, and time does not permit it. However, the overall need for greater childcare in our country must be addressed, not least because of the imminent changes that will be made through the Welfare Reform Act 2009. I have been made aware of the impact that that legislation will have, particularly on single parents, through my work with the Committee for Social Development.

Childcare plays an important role in encouraging more people to get into the workforce and make a greater contribution to society. We cannot simply tell someone that they need to get a job or their benefits will be removed, without at least offering them some assistance to help them get into the workforce.

If the childcare voucher scheme is abolished there will obviously be an effect on business. Members have spoken of the £8 million contribution that childcare vouchers make to the economy. If those vouchers are lost, there will be an impact not only on the childcare industry, but on the businesses that the parents work for, which will lose experienced, valuable workers.

As Jim Shannon said, there will be an impact on the public sector. I can testify to that as well. It seems that an increasing number of officials in Ards Borough Council are women, as is the case with every organisation that I have met recently, and the loss of childcare vouchers could, therefore, have a devastating effect on workers in the public sector.

The whole point of our argument must be that we want people to work. We do not want people with skills and a contribution to make to society, having their skills and attributes underutilised. In many cases, those workers need assistance to utilise those skills. In terms of value for money, the childcare voucher scheme has been a great help and stands the test of scrutiny. Instead of scrapping the scheme and replacing it with something that will only help a small proportion of parents in one region in the United Kingdom, the Prime Minister must wake up and see the benefit that his Government have brought to the whole kingdom through the scheme.

I hope that the much-rumoured U-turn — and we should look at the significance of some of the names attached to it — does happen. We have seen U-turns from the Government before, on issues such as the 10p tax row, and I hope that this one prevails.

In conclusion, I want to commend Employers for Childcare on its ChildcareSOS campaign. I know that that organisation is up for an award elsewhere this evening, and I am sure that it would very much like to win. However, I am sure that it would rather win this argument and retain childcare vouchers. Through the debate, and the widespread unanimous support that has been shown by Assembly Members, I hope that we can also make our contribution to winning that argument.

Question put and agreed to.

Resolved:

That this Assembly expresses its concern at the proposed axing of the childcare vouchers scheme; recognises that the loss of these vouchers could have a significant detrimental impact on working parents in Northern Ireland; supports the Employers for Childcare campaign; and calls on the Prime Minister to continue this scheme and to give consideration to the enhancement of Government support for working parents.