Clause 2 - Duty to secure 30 hours free childcare available for working parents

Childcare Bill [Lords] – in a Public Bill Committee at 2:15 pm on 8 December 2015.

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Photo of Pat Glass Pat Glass Shadow Minister (Education) 2:15, 8 December 2015

I beg to move amendment 8, in clause 2, page 2, line 17, after ‘work’, insert

‘, voluntary work or full-time education course’.

This amendment would also allow those parents who undertake voluntary work or who are in full time education with the intention of retraining for the workforce to access 30 hours of free childcare.

Photo of David Hanson David Hanson Labour, Delyn

With this it will be convenient to discuss the following:

Amendment 12, in clause 2, page 2, line 22, at end insert—

‘(ca) specify other circumstances in which a person is to be regarded as in such work where they are the parent of an eligible child who is disabled;’

This amendment probes on the definition of working parents, and specifically when the parent or parents of a disabled three to four year-old child will be considered as eligible for the additional 15 hours of free childcare.

Amendment 9, in clause 2, page 2, line 26, at end insert—

‘(4A) In making regulations under subsection 4, the Secretary of State must set out in what circumstances a parent or partner who—

(a) is a zero hours worker, as defined under section 27B (2) of the Employment Rights Act 1996,

(b) varies the hours they work on a weekly basis, or

(c) varies the hours they work across the year,

will be considered to meet any conditions relating to paid work.’

This is a probing amendment to clarify eligibility for those parents whose patterns of work will vary day to day and week to week. This would include parents who are on zero hours contracts, parents who work flexibly or seasonal hours, and parents who are self-employed.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I am sorry for the confusion. This is new to all of us. I have been on Bill Committees before, but it is a nightmare, isn’t it? I thought that we were voting—

Photo of David Hanson David Hanson Labour, Delyn

We have voted, and we are now debating amendments 8, 9 and 12.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

Amendments 8, 9 and 12 are all linked by the question of eligibility. As we have heard in the other place and here, the Government started with a manifesto promise of 30 hours’ free childcare to parents who worked more than eight hours a week, but we are now looking at something less than that. Early analysis has suggested that the Bill will remove from eligibility significant numbers of low-paid parents who had thought that they would be eligible. Through this series of amendments that we will be considering today, and perhaps on Thursday, I want to explore eligibility with the Minister. These are probing amendments so that we can be very clear about who is eligible.

Amendment 8 relates to the very many parents across the country who work—and work hard—but who seem to have been cut out of eligibility, simply on the grounds that they do not get paid for the work that they do. I do not think that any of us who have ever brought up  healthy children can ever fully understand the daily pressures that face parents and carers of children who are critically ill or who have a disability. Every day, those parents and carers face the possibility that their child may be too ill to go to school or may need access to medical attention that requires their presence or needs them to attend yet more regular hospital appointments. Parents and carers in such situations have to put their lives on hold. Very often, they cannot work in the way that people who do not face those daily trials do, but many of them choose to work in other ways—in the voluntary sector, on an unpaid basis, and when they can.

The amendment recognises the huge contribution that parents and carers of critically ill and disabled children make to their children’s lives and to society, and tries in some way to recompense them for the time that they give and the work that they do that would otherwise have been funded by the Government. Access to good-quality childcare is important for all families; it has a positive impact on children’s learning outcomes and enables parents to work. It allows children to socialise and to develop skills in socialisation and verbalisation, which cannot necessarily happen—or not in the same way—if children are not in groups.

Photo of Alex Cunningham Alex Cunningham Shadow Minister (Environment, Food and Rural Affairs) 2:30, 8 December 2015

This is not just about people who good things working with charities and so on, but about people who want to go out and get work experience, because they tried to get on an interview panel for a job but were rejected because they did not have any experience. This gives them an opportunity; if they were to get childcare, they could get the experience and then get into work at a later stage.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I welcome my hon. Friend’s intervention; he is absolutely right.

For critically ill or disabled children, access to good-quality childcare is particularly significant, because their families are far more vulnerable to living in poverty than most. Childhood illness and disability are frequently attributable to poverty, because those families incur additional ongoing expenses relating to their child’s illnesses, stays in hospital and frequent hospital and medical appointments. They also often encounter significant barriers to entering and, possibly more importantly, sustaining employment, exactly as my hon. Friend said.

The reality for many of those parents is that they live in poverty; that it will cost them more to raise their child; that they will not be able to get paid work for more than 16 hours a week; that they will not be able to work at all; and that local authorities will simply not have the kind of childcare necessary, with the training needed to meet their child’s medical or other needs. Parents in such circumstances pay more for childcare; as we have heard, in some areas they can pay up to £20 an hour, compared with the national average of between £3.50 and £4.50 an hour.

Photo of Lucy Frazer Lucy Frazer Conservative, South East Cambridgeshire

Without commenting on the substance of what the hon. Lady is saying, clause 2(3) states:

“The conditions mentioned in subsection (2)(d) may, in particular, relate to the paid work”— that is “may”, not must. This is a matter, I assume, to be dealt with in regulations.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

That is precisely why we are probing the Minister’s thinking.

That is the reality for too many families. The amendment would include in eligibility parents who, through no fault of their own, are unable to work in paid employment and therefore might fall outside the eligibility criteria for access to the additional 15 hours of childcare. In all honesty, who needs that childcare more than those parents? They give up so much to support the medical needs of their children. Sadly, for some parents the issue will be temporary, and in time they will be able to pick up their lives. For many more, however, mainly mothers, but also fathers, the proposed measure will mean being unable to enter the paid workforce throughout the life of their child.

My own extended family felt the shock of a diagnosis of leukaemia for a small relative. The immediate family were living and working in west Cumbria at the time. Both parents were working and they had two little girls. The child who was ill was admitted to the Royal Victoria infirmary in Newcastle, which was the centre for childhood cancers in the northern region. She was admitted for long periods of treatment, and her mum stayed with her. Her mum had to resign from her job because no timescale was given for the treatment, which ultimately lasted years. Eventually, the strain on the family caused by the father and the other child living on one side of the country and the mother and the ill child living on the other meant that the father also gave up his job and resettled the entire family in the north-east, near the specialist hospital. That is the reality for many families.

The father took the opportunity to return to education and retrain. He did voluntary work in local schools until he qualified and was able to work as a teacher and support his family. He has done that for the last 20 years. Good-quality, free childcare would have been really helpful to that family. I remember the younger child, who would have gone to anyone because she was so used to being passed around like a parcel. Good-quality childcare is important to families in similar situations today.

Amendment 8 would allow families in such difficult circumstances to access the additional 15 hours of childcare, and I suggest to the Minister that no working families would benefit more. I am not asking for a great deal—I am not asking the Government to change the eligibility details and so on. However, will the Minister consider extending eligibility to parents who are doing voluntary work and satisfy the hours requirement?

Moving on to amendment 12, I want to probe what is meant by “working parent” for the purposes of the Bill. I should be grateful if the Minister gave details of exactly what it means. It has been said that it will include unpaid work, but will it? How will it work for the self-employed and those who move between self-employment and employment? What will be the impact on parents who work but do not necessarily receive payment for that work? I want to probe specifically how the definition will apply to the parents of disabled children. We have already heard that 40% of those parents are unable to access the 15 hours to which they are currently entitled, which is 10 times more than families with non-disabled children. A lack of suitably qualified and trained staff and a lack of confidence among providers prevent them from accessing that childcare.

We have heard that childhood disability is often a trigger for poverty, because families incur additional ongoing expenses and face significant barriers that the rest of us do not. We have also heard about the additional costs that go along with that and the fact that mothers of disabled children cannot work at all.

The Minister said he wanted to work with me to improve the take-up of free childcare by families of disabled children, but he was not prepared to support an amendment to increase the hourly rate. With amendment 12, we want to explore eligibility so that it is clear what we mean by “working parent” and what impact that will have on parents of disabled children.

Does the Minister’s offer to work with me to improve the take-up of childcare include a desire to look at eligibility and additional hours? We want to ensure that more families can access their entitlement, and that more mothers, and indeed fathers, of disabled children can go out to work, so that over time we can take more and more families with disabled children out of poverty. This is a probing amendment, and we simply want to see how far the Minister is prepared to go.

On amendment 9, the Bill states:

“The Secretary of State must secure that childcare is available free of charge for qualifying children of working parents for, or for a period equivalent to, 30 hours in each of 38 weeks in any year.”

It continues:

“The Secretary of State may make regulations for the purpose of discharging the duty imposed by section 2(1)” and specifies that those regulations may, for example, include

“enabling any person to check whether a child is a qualifying child of working parents…make provision about the disclosure of information held by a Minister of the Crown, the Commissioners for Her Majesty’s Revenue and Customs or” any other person.

Clause 3(5) states that

“a criminal offence created by…regulations may not provide for a penalty of imprisonment on conviction on indictment” of more than two years—so someone can get two years in jail. This is really serious stuff.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

On that point, it sounds dramatic to suggest that people might go to prison for this, but I have worked with women in refuges who have ended up in prison because their children did not go to school for a variety of reasons. Does my hon. Friend agree that that is alarming?

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I am shocked that women end up in prison because their children will not go to school. It is not necessarily something that a mother living in a refuge, separately, can do anything about. This is serious stuff, and it is really scary stuff for parents. If they get it wrong, they could end up in prison or with a hefty fine. It is really important that the Committee probes exactly what is meant by eligibility. I want to see how far the Minister is prepared to go on that, because I am not quite clear about who is eligible and who is not. He needs to help us with that.

Photo of James Berry James Berry Conservative, Kingston and Surbiton

Does the hon. Lady agree that there should be penalties for what is, essentially, fraudulent activity, but that the  thresholds for those penalties and the circumstances in which they come to play should be set out very clearly in the guidance?

Photo of Pat Glass Pat Glass Shadow Minister (Education)

Could the hon. Gentleman say that again?

Photo of James Berry James Berry Conservative, Kingston and Surbiton

Does the hon. Lady agree that there ought to be penalties when a parent takes an action that is tantamount to fraud on the state, but that the circumstances in which those penalties might arise should be specified clearly in the guidance?

Photo of Pat Glass Pat Glass Shadow Minister (Education)

That is exactly what we are asking for in this probing amendment. Yes, I agree that there need to be penalties if someone is deliberately defrauding the state. I do not want to get parents into a situation in which they are affected unintentionally because the guidance or the eligibility criteria are not clear.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

I wonder whether my hon. Friend, like me, has ever tried to follow the guidance on child tax credits, or whether she has ever had anyone in her constituency office who has fallen foul of some of the guidance laid out by different Government Departments offering state-subsidised childcare. Potentially, we could have put every single person in prison.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I have not personally ever tried to follow the guidance, because I have no children who would qualify for childcare, although I do have grandchildren. Many people who have come to my constituency surgeries have found themselves with huge tax credits bills to pay back. They never intended to get into that situation in the first place; it was not about trying to defraud the system. These things are complex, and we want to ensure that the provision is as simple as we can make it so that parents do not get into these kinds of difficulties.

How will the eligibility of parents whose patterns of work vary from day to day and week to week be assessed and monitored? Those people include parents on zero-hours contracts, those on flexible working hours, seasonal workers and those who are self-employed, whose hours of work and income are often entirely outside their control. What all those workers have in common is the need for their working hours and incomes to be averaged over a period of time. The way we work today is not the regularised pattern of eight hours a day, five days a week with weekends off. Look at the Members of this Committee—it is not the way we work, and it is not the way that most people work these days.

Many parents have several jobs and sometimes juggle taking care of their children with a couple of part-time jobs. The reality is that many families in my constituency work in self-employment because there are not jobs around for them to do. In a sense, they are forced into self-employment. Although that takes them off the claimant count, they cannot necessarily predict what they will do from one week to the next.

I saw in a report—I think it was when I was a member of the Select Committee on Education—some really alarming statistics about young men in the 19 to 25 age  group. Research had found that in the city of Birmingham, almost 24% of young men in that age group were simply not in the system at all. They had dropped out altogether, because they were tired of moving from zero-hours contracts, to claiming, to being sanctioned and so on. They had thought, “I will just work and get paid cash in hand” That makes such people incredibly vulnerable. In addition, some of them will have families and will need childcare. How will those families be eligible for the extra hours of childcare, if at all?

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth 2:45, 8 December 2015

My hon. Friend eloquently explains how complicated things are even for men who do not have children. If we add to the basic benefits system and the tax credits system the need for parents to work out their additional eligibility for free childcare, they will have to do complicated sums to work out whether they will be better off on tax-free childcare or universal credit. Every time their income changes, every time their hours change and every time their child hits another birthday, they will have to amend their application further. Is it any wonder that parents are worried about getting into trouble through no fault of their own?

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I welcome that intervention. We do not want people to get into the situation that we see frequently in our constituency surgeries, where parents turn up with huge bills for tax credits that they need to pay back. They did not intend to get into that situation, and it is not about fraud; it is about things being unclear.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Lady touches on an important issue, which is worth clarifying. The power to create an offence in the Bill relates only to information—that is, sensitive information about children or about parents’ income—being passed on without authorisation. The measure is designed to protect parents and their data, not to punish them. The financial penalties scheme is for false declaration or fraud, which is more proportionate.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

That is helpful. In that case, the people who are likely to face incarceration are not parents, but those who abuse parents’ information.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

That is really helpful. Still, financial penalties will be imposed, and we see that happening all the time to parents who are on tax credits. It would be best to avoid that situation if we can by being as clear as possible. Given that many families have different and varied patterns of work, it would be helpful if the Minister could explain to us exactly what the eligibility criteria will be, and how far he is prepared to go on that question. For those on zero-hours contracts, those who do seasonal work and the self-employed, whose work and income are entirely variable and dependent on others, eligibility needs to be calculated over a period of time.

For many people, the self-employed included—we welcome the desire expressed by the Government to include them in eligibility for the scheme—it will not be possible for them or for Her Majesty’s Revenue and Customs to confirm their income until 18 months after the end of a financial year. The Minister will get absolutely sick of me giving him the benefit of my experience, but when I worked in education and we had student grants—  remember them?—self-employed parents were allowed to estimate their income, and their children’s grants were calculated on the basis of those estimates, with a full reconciliation 18 months later when HMRC issued confirmation of the parents’ income. I am sure that the same is true of student loans. Will similar estimations of income and hours of work be allowed in this case? Will they be calculated over a certain period? If so, what will that be?

Photo of Chloe Smith Chloe Smith Conservative, Norwich North

I do not know whether the hon. Lady knows this, but there are at least three members of the Committee who did not enjoy student grants—

Photo of Chloe Smith Chloe Smith Conservative, Norwich North

There are four, but that is not the point of my intervention. The point of my intervention is to ask the hon. Member for North West Durham, in the spirit of her probing amendments—a healthy spirit—to explain to us a little more how she would have liked to tidy up the system with the introduction of the 25 hours of free childcare that her party was hoping to bring in had it won the election. Will she explain how things ought to be done?

Photo of Pat Glass Pat Glass Shadow Minister (Education)

My understanding is that the 25 hours was universal, and when something is universal we do not need such untidiness. Now, however, we are talking about the Government’s 30 hours. For the benefit of us all, parents in particular, I simply want clarification of the issues. Will those income and hours be estimated over a period of time? What is that period? Will HMRC be confirming things?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Lady is being incredibly generous in giving way again, and I will address her points in my response. I hate to be the killjoy who reminds her, but the manifesto on which she stood for election promised 25 hours of free childcare for the working parents of three and four-year-olds. It was not a universal offer.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

It was universal for parents who are working. Getting back to the probing amendment, will an average of 16 hours a week over 52 weeks be possible for those on zero-hours contracts, in seasonal work and so on? What will happen if something goes wrong? What will happen if parents genuinely believe that they will work an average of 16 hours a week over 52 weeks, based on the average of the past three years, say, but something goes horribly wrong and they fail to reach the average hours or the average income?

Things do go wrong for families. Poor weather might lead to a rotten summer—it would never happen, because that is completely unknown in the UK, isn’t it? If a business depends on a good summer, people could find themselves falling foul of the income threshold. Flooding over Christmas, or even in November, might wipe out earnings in the peak season—again, not unknown in the UK. Recession might dry up people’s work and income—again, not unknown in the UK—or even an international banking crisis could force families into unemployment and poverty. It might be something else that is completely out of the control of the parents. What will happen then?

If the parents genuinely estimate their position based on the previous three years, backed up by all that historical stuff, and then something goes wrong, who will make decisions about that? What is likely to happen to parents? Will they have to pay back the cost? I was going to ask if they faced two years in prison, but we have already heard that they will not.

The Minister needs to make regulations and it would be helpful to know what is in his mind when he is thinking about them. We all welcome the Bill—so warmly that we want to get it right for parents. If the Minister can be absolutely clear about the issue of eligibility, we will be grateful.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

I will speak specifically about eligibility and probe a little more how it will work. The two areas that I wish to speak about are women who live in domestic violence refuges and those who have their children in a maintained sector service much like the one my children attended.

If my children enjoyed the full week in childcare for free—it seems like manna from heaven to me—and I lost my job, their places would be removed. I would only be able to send them to the maintained sector service for 15 hours of the week, if I understand how the regulations will work. A place for only half the week would then become available to a child in that maintained setting, and another person using that childcare would need to lose their job to make that up to a whole place, so I would have to take someone down with me whose children also went to school with mine, which seems a bit dramatic. If free entitlement increases from 15 to 30 hours, the number of places in that setting is reduced. If my circumstances changed, there would be half a place free—half a place is as useful as a chocolate teapot. I am not sure how Ministers will get around that particular instance if people’s circumstances change. Will people whose employment is at risk—those who might not keep their job—only be able to get childcare in the private sector, not the maintained sector? Would I, under this system, have to put my child with one child carer for the first half of the week and a different one for the second half? I just cannot see how this will work in the world that I live in.

Photo of Michelle Donelan Michelle Donelan Conservative, Chippenham

Will the hon. Lady please clarify something for me? Is she actually saying that if somebody like her lost their job, they should still be eligible for this benefit? It was my understanding that this policy is about helping people into work and helping those who are in work.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

I am saying exactly that. Who knows how long someone might be out of employment? Their child would lose their place for the second half of the week. People need time to go and find a job. When me and my children were in that situation, I was working three voluntary jobs to gain experience so that after my second son was born, I was able to get a full-time job. So yes, I am saying that it is probably not the best thing to say to somebody who has just lost their job, “Your child’s situation will now have to completely change. You won’t be able to go and seek a job, as you’ll now be tied to childcare.”

Photo of Michelle Donelan Michelle Donelan Conservative, Chippenham

It is my understanding that the Bill gives a grace period to accommodate that.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

And how long is that grace period? I put that question to the Minister.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

I thank the hon. Lady for inviting me to intervene. The system will be checked by HMRC, which will check earnings on a forward-looking quarterly basis. Based on that, parents will be eligible for childcare. That will be done automatically; parents do not need to apply. If parents disagree with the decision that is made, there will be an appeals process about which I will speak in more detail in my speech. We have to remember the fundamental principle mentioned by my hon. Friend the Member for Chippenham—this is about work. Someone needs to earn only £115.20 a week––

Photo of David Hanson David Hanson Labour, Delyn

Order. Interventions must be short. The Minister will have an opportunity to wind up the debate in his speech later. Other Members have opportunities to intervene and make speeches because we are not limited to time. I would be grateful if Members would bear that in mind.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

I am grateful for that clarification. From that, I read that there will be a three-month grace period, if it is quarterly. I totally understand that and it is great if someone can find a job within three months. Obviously, if they do not find a job in that time—for example, if they find one within four months—they would then have to find another place for their child separate from the 15 hours that the child would already be spending with a different child carer.

Government Members might think that I am splitting hairs, but I am speaking from real-life experience of what would have happened to me had this been in place when I was going through the process. I am not that special—I know that is shocking to hear—and this will be happening to lots of parents exactly like me. There is an issue with the maintained sector—how nursery places are allocated for the 30 hours compared with the 15 hours—that must be taken into account by any regulation. That is the first thing I would probe.

The second thing that concerns me, having worked for much of my career in a domestic violence refuge, is the effect of women leaving their jobs to live in refuge. I am sad to say that the way that our benefits system is structured and has been for many years—this is no fault of this particular Government on this occasion—means that women who live in refuge cannot really work. They cannot afford to be a working woman in refuge. It is near impossible. The vast majority of women who live in domestic violence refuges are therefore living on housing benefit, which cannot be claimed if they are in work, because the rates for refuge provision are far higher than the weekly rates for a normal social housing scheme. That said, 90% of women in refuge do not work and those who worked before they entered refuge by and large have to give up their job to live in the refuge.

A child already moving from their home—their secure setting—and leaving everything behind will potentially have their childcare place taken away because their mother is no longer in work. I beg the Minister to make a change to the eligibility criteria to make sure that women and children living in refuge are not covered by that change to the system.

I am pleased to say that every time I have risen in the House to ask for an amendment to be made or for women in refuge to be exempted from something, that has happened. I hope that on this occasion women in refuge will be exempted from the eligibility criteria.

Photo of Chris Matheson Chris Matheson Labour, City of Chester 3:00, 8 December 2015

I may be showing my inexperience, in which case I apologise to the Minister and hon. Members for misunderstanding the process, but when my hon. Friend the Member for North West Durham moved the amendment, I listened with some dismay, because it seems that while at the general election there was a clear pledge of 30 hours’ free childcare, there is now a lack of clarity about who is eligible for the programme. Apparently we see the Government backtracking on matters: they have tried to squeeze the criteria into the promise they made at that time.

I am inexperienced in these matters, so perhaps it is normal for a party to make an announcement at a general election that is not properly costed and then it has to come up with proposals on how the criteria will fit the policy in the legislative process. If I am doing the Minister a disservice, I will gladly apologise, but I ask the Conservatives to consider the pitfalls of making promises without a fully costed programme and then having to cost them afterwards.

Photo of Lucy Frazer Lucy Frazer Conservative, South East Cambridgeshire

The hon. Gentleman is talking about our promises. The Labour party said:

“Labour has a better plan for working families.”

Its offer was to working families; it was not universal. It offered an extension not to 30 hours, but to 25 hours, and in no place did it mention special provisions for vulnerable people.

Photo of Chris Matheson Chris Matheson Labour, City of Chester

That is all well and good, but the fact is we were clear about our policies and where the money would come from. Unfortunately, our amendments reveal a lack of detail in the Government’s proposals and I hope the Minister will answer that. I am slightly dismayed that we need these probing amendments in the first place to try to get clarity when no such clarity was lacking before the general election.

My hon friends the Members for North West Durham and for Birmingham, Yardley asked questions about voluntary workers. I recall the Prime Minister talking about his vision for a big society in which voluntary work plays such an important part in the development of communities. I hope the Minister will bear that in mind, assuming that the Prime Minister still holds that vision—perhaps the big society has fallen by the wayside.

Finally, the Minister explained that HMRC will have a role in assessing eligibility in terms of the grace period. My one concern is that contacting HMRC is not a straightforward procedure, as anyone who has tried to do so over the past couple of years will know. The organisation is under strain on tax returns, for example, and asking it to take on additional duties will put extra strain on it. Will the Government provide extra resources to HMRC to allow it to maintain the quality of its service, as I am sure officers of HMRC wish to do? I fear that the proposals will place a greater burden on HMRC, which will make contacting it to talk about the matters that my hon. Friend the Member for Birmingham, Yardley raised even more difficult. Perhaps the Minister will address those points.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

It is a privilege to serve under your chairmanship, Mr Hanson. A number of points that have been raised this afternoon have led me to think that Opposition Members want to turn an employment offer into a universal offer of 30 hours of childcare. To be clear, every three or four-year-old will get 15 hours of childcare. The entitlement to the second 15 hours is based on the parent’s employment. I will speak to amendments 8, 9 and 12, to clarify whether specific groups of parents from varying circumstances will be able to access the 30 hours—the extended entitlement—as per those probing amendments.

I am grateful to the hon. Members for North West Durham and for Birmingham, Yardley for the amendments, and I want to make it clear that the Government recognise that for many families, childcare is not an issue; it is the issue. That is why supporting working families with their childcare costs is at the heart of our policy. Amendment 8 concerns parents who work on a voluntary basis and full-time students. It would allow parents who are not in remunerated work, but who are contributing to society through voluntary work, to access the extended entitlement. It would also allow parents who are in full-time education and taking steps to retrain and prepare themselves for the labour market to access the extended entitlement.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I want to make it clear that when we talk about full-time students in training, we are talking about students who are on a training course that will lead into an occupation. We are talking not about full-time study across the piece, but about people who are training to be nurses, doctors or teachers, or doing something that will lead directly into employment.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

I thank the hon. Lady for that clarification, and I will come back to that in detail. As I have said, all three and four-year-olds, and 40% of the most disadvantaged two-year-olds, are already entitled to 15 hours of free childcare a week. That provides substantial opportunity for their parents to take up voluntary work where they wish to do so, or indeed to study. The additional 15 hours of free childcare is intended to help parents who wish to take up paid employment to support their families.

The additional 15 hours will be available to families where each parent, or the sole parent in a lone parent family, earns an average weekly income equivalent to at least16 hours at the national minimum wage or the living wage, and less than £100,000 a year. Although the Government recognise the importance of volunteering, the purpose of the extended entitlement is to help working parents with the cost of childcare so that they can take up paid work if they want to, or work additional hours. The approach we are taking is consistent with other Government childcare schemes, including tax-free childcare and the childcare element of universal credit.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

The Minister just mentioned an average weekly income of more than 16 hours at the national minimum wage. Is that the current minimum wage or the Chancellor’s living wage?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

That is a good question, and I am happy to provide clarification. The national living wage applies to people over the age of 25, so, in their case, the eligibility criterion would be set at that rate, which is  £115.20 a week. Those who are under 25 will be on the national minimum wage, in which case the earnings criterion will be £107 a week. Even if someone is doing voluntary work, if they can combine their voluntary work with earning £107 or £115.20 a week, they will get the additional 15 hours of childcare.

Photo of Alex Cunningham Alex Cunningham Shadow Minister (Environment, Food and Rural Affairs)

I hope that the Minister enjoyed his long career as an investment banker and subsequently running his own business that specialised in recruitment. He will know that experience is absolutely critical to people getting a job. Surely, if people are to achieve the work experience they need to get on to an interview list, we should value all their work. Some of these jobs, like interns here at the House of Commons, are unpaid full-time roles. Surely we should value that, let them have childcare and then move on into a career.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

I do not know about the hon. Gentleman, but I try to pay the interns who work in my office.

Photo of Alex Cunningham Alex Cunningham Shadow Minister (Environment, Food and Rural Affairs)

I will place on the record that I have never taken an intern because I cannot pay one. If I were able to pay one, I would, and I think the same should apply to every MP within the House.

Photo of David Hanson David Hanson Labour, Delyn

Order. We are going slightly off beam.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Gentleman makes a good point about volunteering. We recognise the importance of volunteering, but as I said, the purpose of the extended entitlement is to help working parents with the cost of childcare. The approach we are taking here is consistent with other Government policy. Of course, where a parent or parents are undertaking voluntary work alongside paid employment that meets the minimum income criteria they will be eligible, as I have said, for 30 hours of free childcare. However we are clear that parents solely undertaking voluntary work should not be able to access the extended entitlement.

The issue of parents in full-time education has also been raised. Again, they get the first 15 hours and if they are in the 40% most disadvantaged households, they will get 15 hours of free childcare for their two-year-olds. In addition, the Government already provide support to parents in recognised education courses through discretionary learner support and the loans bursary fund. Students in higher education may be eligible for support through the childcare grant, which offers parents support of up to 85% of their childcare costs up to a maximum of £155.24 a week for one child and £266.15 for two children. Where parents choose to undertake part-time work alongside their studies, and on average earn the equivalent of 16 hours at the national minimum wage or living wage per week, they will also be able to benefit from 30 hours of free childcare. However, we are clear that parents solely undertaking full-time study should not be able to access the extended entitlement.

Photo of Jess Phillips Jess Phillips Labour, Birmingham, Yardley

I wonder whether those training to be nurses, who are working now for free in our NHS, will be entitled to the 30 hours of free childcare if they are in full-time nursing training.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

There is the Care to Learn Scheme, which can apply in some cases, and other programmes, such as the childcare element of tax credits, could apply to them, but specifically, the additional 15 hours here is linked to employment and income, unless you are earning no income at all, when of course, you will not be eligible to get this.

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth

Is the Minister saying that parents can only use this offer if they are already working? What concerns me is that this offer will not benefit those parents who want to get into better paid work because they are studying full-time. When one is studying full-time it is quite difficult to also work while also having three and four-year-olds.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

Many of those parents will be eligible, assuming they are at the lower end of the income scale, for the childcare element of tax credits and universal credit when that is fully rolled out. There will be support through that to help them with their situation, in terms of getting back to work. There are also other programmes, such as the Care to Learn Scheme which can help them. As far as the additional 15 hours is concerned, yes, it is linked to an actual employment status. Under the voucher scheme that was introduced by the previous Government, people who were self-employed or earning the minimum wage did not qualify for that scheme. Under the scheme we are introducing here, all these people qualify for their additional 15 hours.

As I have said, supporting working families is at the heart of this policy and we have been clear throughout that people on zero-hours contracts and the self-employed will get this. The contractual position will not determine whether their children—and it is the children rather than the parents—are eligible. The legislation allows for children of parents on zero-hours contracts to be eligible in the same way as anyone else. Eligibility will be based on what parents reasonably expect to earn on average across the coming quarter, enabling parents with more irregular working patterns to benefit.

The hon. Member for Birmingham, Yardley asked for practical examples, so I will give one. We know that a parent on a zero-hours contract will work some weeks but not others, and might not know in advance whether they will have work in any given week. If on average they work two weeks out of every three, and when they are working they get 25 hours of work at the minimum wage, their child will qualify for 30 hours of free childcare.

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth 3:15, 8 December 2015

Will the Minister clarify over what period those calculations are done? Does he literally mean that the calculation will be done over a three-week period, or will it be averaged out over several months, particularly given what my hon. Friends said earlier about seasonal and variable working hours?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

As I said in response to an earlier question, the calculation will be done on a quarterly basis, but over time, the system will know what someone’s average earnings are. The hon. Lady also asked in an earlier question how simple it will be for parents. Parents will not have to update their details constantly; it will be done quarterly by the system. Parents will not have to work out complicated sums to access the extended  entitlement, as they must do in the tax credits system. The joint application system that HMRC develops will provide a single, simple point of access for parents. The system will give parents an instant decision on their eligibility in most cases, so that will apply in the vast majority of cases.

Again, to take a practical example, a person on a zero-hours contract who, despite periods without work, reasonably expects to meet the minimum income level will be eligible. HMRC will take a proportionate approach to compliance, using details of past income and other information provided by parents to assess eligibility. We know that parents whose situations fluctuate need their childcare arrangements to support them in work. We will therefore work with local authorities and childcare providers through the early implementation phase to develop provision that can support parents with irregular working patterns.

There are already good examples from across the country of providers offering parents flexible care. For example, in Brent, they have set up an emergency and overnight register to match up parents with childminders whom they can access at short notice 24 hours a day, seven days a week. Swindon intends to offer weekend early-education sessions from January 2016, initially through an academy and a private provider, as well as through a number of registered childminders. Through early implementers, we will work on the right type of provision as well as ensure that the eligibility system works consistently with people whose earnings fluctuate.

We want to see that kind of innovation in other parts of the country, and that is what the early implementation programme will support. We also recognise that self-employed parents’ income is often not smooth or predictable. The free entitlement will be available to self-employed parents, and we intend to have special rules for them similar to those available in tax-free childcare. Self-employed parents who work throughout the year but get income only at certain times in the year will be able to average that income across the whole tax year rather than just quarterly. Also, because new businesses often struggle to get going, self-employed parents will not need to take the minimum income limit into account at all in their first year.

Amendment 12 relates to the parents of an eligible disabled child. Again, we recognise that all families are different and that some may face particular issues, for example where parents have caring responsibilities. That is why we have made it clear throughout the passage of the Bill that when one parent is employed and one parent has substantial caring responsibilities, based on specific benefits received for caring, such households will be able to access the extended entitlement.

I am pleased to confirm that it is our intention that that will include households where one parent is working and one parent is being paid carer’s allowance or the carer element of universal credit. That includes parents caring for their own three or four-year-old child where the child is in receipt of disability living allowance or is certified blind. If a single parent with a disabled child meets both the conditions regarding paid work and the minimum income threshold, they will of course be able to access the extended entitlement. If they do not work they will not be eligible for the entitlement, but they might be able to receive carer’s allowance or universal credit.

The appeals process has been touched on. If parents are not happy with HMRC’s decisions about their eligibility, they will be able to seek a mandatory review by HMRC, and if they are still not satisfied they will be able to appeal to the first-tier tribunal. They can also appeal against decisions about financial penalties—both the fact of the penalty and its amount.

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth

I thank the Minister for those detailed responses to our concerns, and for being keen for the system to be simple and straightforward as possible for parents when their eligibility for the various schemes is being assessed. Has he had conversations with HMRC and the Treasury, and is he confident that the necessary resources and the technical support will exist in HMRC to provide a seamless, smooth and well informed process for parents who will be navigating what appears to be a complicated system?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

I thank the hon. Lady for her interest. Getting the technology platform right is absolutely crucial, and the cross-Government taskforce on childcare, which I co-chair, has considered it in detail. In addition, officials in the Department for Education are working closely with HMRC on the joint system, the development of which secured funding at the spending review, and we will provide the system to HMRC in due course. I thank the hon. Lady for her legitimate concern.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I apologise if I missed this information. The Minister said that parents will be able to appeal to the first-tier tribunal. Will that be the employment tribunal, and will there be costs involved for parents, in the same way as there are for those appealing to that tribunal regarding unfair dismissal, for example?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

If the hon. Lady will bear with me, I will await inspiration from the usual channels. In the meantime, I will plough on with my speech.

In relation to the extended entitlement, we are clear that the powers we have taken are sufficient to enable us to cater for non-standard working patterns and families’ different circumstances. I can also reassure hon. Members that if a parent’s circumstances change, their child will remain eligible for the extended free entitlement for a short period—there will be no instantaneous change. We hope that within that period the parent will be able to regain employment and continue to declare that they expect to meet the eligibility criteria. If that is not the case, and the parent is clear that they no longer expect to be in paid employment after the grace period, they become ineligible.

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth

The Minister begs the question: what is the definition of “short period”?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The short period is in line with the grace period, which is three months.

As hon. Members can see, we fully support the intention behind the amendments. However, we believe that putting too much detail in the Bill about the specific circumstances in which children could qualify risks inadvertently excluding some of those we want to include. Nevertheless, Members will have the opportunity to scrutinise the regulations before they are finalised.

As part of the development of the joint childcare application system, we will publish information for parents and their partners to make clear the eligibility rules for different groups of parents, so that they can be clear about whether they can access the extended entitlement. Online and telephone advice will also be available to assist parents. In addition, we will publish statutory guidance for local authorities next year, so that they can advise parents about their eligibility for the extended entitlement and discharge their responsibilities for delivering childcare places in keeping with the scheme’s rules.

In response to the question about the first-tier tribunal, the inspiration that I have received says that it will be specifically a social security tribunal and not an employment tribunal.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

So there will be no costs?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

I will get inspiration on that before the end of my speech.

I hope that hon. Members are reassured that the parents who are the subject of these amendments will be supported under the Bill, and I hope that the hon. Member for North West Durham feels reassured enough not to press the amendments.

I am waiting for inspiration and for someone to intervene on me.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

If the Minister wants to write to me on the issue of qualification, I am happy for him to do so if the information is not immediately available.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

Inspiration has arrived—the tribunal will be free to parents.

On that basis, we will resist amendments 8, 9 and 12, on the grounds that the details of the matter can be covered in regulations.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

I am immensely grateful to the Minister for that. The word on the street was that the Government wanted to better Labour’s offer of 25 hours of free childcare but never really expected to have to deliver it—they thought they would be able to deal it away in some kind of coalition. Given that, I think the Minister has done incredibly well in getting to the detail; credit where it is due.

The Minister has been able to clarify for me, in a way that I did not understand before, the issue of eligibility and the 16-hour work threshold, the issue of those under and over 25, and the issue of the national living wage and the minimum wage. That is really helpful.

I am also immensely grateful to the Minister for clarifying that parents will not end up in prison. I had an awful feeling that parents could end up with two years in prison as a result of getting the system wrong. That is clearly not the case. I also now understand the eligibility criteria on the grounds of income.

I seek clarification on one point, and I am happy for the Minister to intervene on me. I was interested in what he had to say about people who are self-employed, which we welcome, but there is a danger. I hate to throw a spanner in the works, but if someone is eligible automatically in the year in which they set up a business, are the Government mindful of people who would want to abuse the system by folding their business at the end of the year and starting a new one?

I have concerns about only a couple of things now, and I think my hon. Friend the Member for Birmingham, Yardley raised one of them. In the spending review, the Chancellor changed the system of training for nurses, so that they no longer come under bursaries and now have to receive grants. That will automatically wipe out a huge number of nurses across the country from eligibility for childcare, and I ask the Minister to have another look at that issue. Those people are not on great wages, they are working hard, and they will contribute to our society in the future in a way that many other students on grants perhaps will not. It is unfortunate, to say the least, if they are simply taken out of the eligibility criteria.

Also, I understand the reasons behind the grace period, but I worry a little bit about children falling out of childcare places every 13 weeks. If a parent regularly finds a job after four months, once their children have built relationships—for some families, that is the case—that could have a worrying impact on the children’s development. I do not know what the answer is—I am not pretending that I do—but it is something for the Government to consider.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Lady raises an important point about how the grace period works in practice, the eligibility checking and the actual childcare places on the ground. As I said, one of the principal things that we will be able to test during the early implementation phase is exactly when a local authority is informed, when the provider is informed, how long a place is kept open for and so on. We will have to iron out those details, which is why they belong in regulations rather than in the Bill.

Photo of Pat Glass Pat Glass Shadow Minister (Education) 3:30, 8 December 2015

Finally, will the Minister think about what my hon. Friend the Member for Birmingham, Yardley said about women’s refuges? Domestic violence underpins so many problems across the country. Many years ago I was a director in an authority. We had an emergency crisis team for children in primary education, and we would meet every single week with groups of headteachers to consider children who were in crisis and allocate specialists and clinical psychologists to try to help those children. In 100% of cases that I saw—at the time, I remember being really shocked—there was domestic violence. It is endemic, and we do not address it in the way that we should. For those children and their parents, there may be—

Photo of Pat Glass Pat Glass Shadow Minister (Education)

More than a grace period; an exemption.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Lady again makes a very good point, and I thank the hon. Member for Birmingham, Yardley for raising the issue. I am willing to offer to look into what exactly someone in such a situation will get, because there is a package of childcare measures, and they might be entitled to other measures. I am happy to write to the hon. Lady and meet her to look at what they could get and how it could be dealt with.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

We are grateful to the Minister for that. In the spirit of that offer, I do not intend to press the amendment to a vote. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

I beg to move amendment 2, in clause 2, page 2, line 25, leave out from “about” to the end of line 26 and insert “—

(i) the form of a declaration and the manner in which it is to be made;

(ii) the conditions to be met by the person making a declaration;

(iii) the period for which a declaration has effect.”

This amendment enables the Secretary of State to set conditions to be met by a person making a declaration as to a child’s eligibility for the extended entitlement

Photo of David Hanson David Hanson Labour, Delyn

With this it will be convenient to discuss Government amendments 3 and 6.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

These amendments are on the role of HMRC in relation to the extended entitlement, and they include a consequential amendment that would enable the provision to come into force immediately on Royal Assent. They are technical in nature.

As the Secretary of State for Education, my right hon. Friend the Member for Loughborough (Nicky Morgan), set out on Second Reading, parents will be able to apply for the extended entitlement as part of a simple joint online system being developed by HMRC in partnership with National Savings and Investments for tax-free childcare. That means that parents will have to provide information on their personal circumstances only once, even where they wish to apply for both schemes, which will create a simple and smooth customer journey that will save parents and providers valuable time.

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth

I value the Minister’s comments, but am I right that some parents will go down the universal credit route? Can we be assured that there will be a link-up between HMRC and the Department for Work and Pensions to help parents assess their eligibility, depending on which route they take?

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Lady raises a good point. Obviously, universal credit is different benefits rolled into one. The one that we are concerned with here is the childcare element. There is a plan further down the line to make sure that is incorporated, which will make it easy for parents to move across the different childcare products as their circumstances change.

Photo of Ruth Cadbury Ruth Cadbury Labour, Brentford and Isleworth

With funding from different sources.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

That is very much part of the thinking.

Amendment 2 will enable regulations to be made under the clause setting out the conditions to be met by a person making a declaration as to a child’s eligibility for the extend entitlement. For example, to be consistent with tax-free childcare, the person making the declaration will need to be the person responsible for the child. It is crucial that we are able to provide clarity for parents about the declaration they will have to make, and that we can ensure that HMRC will be provided with the information it needs to make decisions about whether a child is eligible for the extended entitlement.

The conditions that the person making the declaration will need to meet will be set out alongside the form and manner of the declaration. Regulations will say more about those matters in due course and will be subject to the highest degree of parliamentary scrutiny.

Amendment 3 will make it clear in the Bill that HMRC will be verifying, and making a determination about, a child’s eligibility for additional free childcare. The amendment will ensure that HMRC can work in a timely fashion to extend its online system, so that it can also check eligibility for the 30 hours of free childcare. That will enable HMRC to determine whether a child is eligible for the extended entitlement.

Amendment 6 deals with commencement, which is when the various provisions of the Bill will come into force. It is consequential on the new provision that gives HMRC the power to make a determination as to a child’s eligibility. We intend that provision to come into force on Royal Assent, so that HMRC can begin to build the technical aspects of the joint eligibility checking system.

Ensuring that the operational aspects of the extended entitlement are in place in good time will enable us to test that the eligibility checking system runs smoothly for parents.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

These are technical amendments, and we do not have a problem with them. The only thing we ask is that the Minister confirms that HMRC has the capacity and resources to deliver. Members from all parts of the House deal regularly with HMRC, which is one of the most difficult departments. I remember when a nurse who had just retired came to see me. She had been on PAYE throughout her career, and she suddenly got a bill for £42,000 back tax. After we explored the matter, it turned out that she did not owe anything. I always count such results as major successes, but such cases are happening in all our constituencies all the time. People tell me that they spend hours and hours trying to get through to HMRC, just to ask simple questions about their tax. We need to know that HMRC has the capacity and resources to deliver on this measure.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The hon. Lady asks a legitimate question. Although HMRC will be checking eligibility, the measure is not specifically to do with the tax system. Funding has been provided to offer parents telephone support where needed, and there is funding available for the IT system. That funding specifically relates to checking eligibility for the 30 hours of childcare, rather than being part of HMRC’s wider tax-related activities.

Amendment 2 agreed to.

Amendment made: 3, in clause 2, page 2, line 26, at end insert—

‘(4A) For the purposes of assisting the Secretary of State in the discharge of the duty imposed by subsection (1), the Commissioners for Her Majesty’s Revenue and Customs may carry out functions in connection with the making of determinations as to whether a child is a qualifying child of working parents.’—(Mr Gyimah.)

This amendment confers on HMRC the power to make a determination as to a child’s eligibility for the extended entitlement and carry out associated functions.

Question proposed, That the clause, as amended, stand part of the Bill.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education

The clause will place a duty on the Secretary of State to ensure that childcare is available free of charge for qualifying children of working parents  for a period equivalent to 30 hours for 38 weeks in any year. The Government recognise that childcare is an issue for many families. The new extended entitlement, with an additional 15 hours, is intended to support working parents with the cost of childcare, enabling them to work additional hours if they wish to do so. That will be available to families where both parents are working or the sole parent is working in a lone-parent family. Self-employed parents will also be eligible, as we heard earlier, as would parents in receipt of tax credits, universal credit, tax and childcare vouchers through their employer or tax-free childcare.

The clause gives the Secretary of State the power to set out in regulations the description of a qualifying child. We intend that a child will qualify from the school term following their third birthday, in the same way as with the existing 15-hour early education entitlement. The clause will also enable the Secretary of State to set out in regulations the criteria that must be met by parents. The regulations would set out what is or is not to be regarded as paid work and how the extended entitlement would support temporary absences from the workplace. It is important that parents on maternity, paternity or adoption leave can maintain their existing childcare arrangements while they take time away from the workplace to adjust to the new arrival.

As the Secretary of State set out on Second Reading, each parent must on average be earning a weekly minimum equivalent to 16 hours at the national minimum wage or national living wage. From April 2016, the national living wage will come into force for workers aged 25 and over, alongside the national minimum wage for workers under 25. A working parent who is 25 will therefore need to earn a weekly minimum equivalent of £115.20 in order to be eligible, whereas a working parent who is 21 will need to earn a weekly minimum equivalent of around £107 at this year’s minimum wage rates. Parents on zero-hours contracts and the self-employed will be eligible in the same way as anyone else, provided they meet the earnings criteria across the coming quarter on average.

Parents with fluctuating incomes will be able to access the extended entitlement if they reasonably expect to earn the minimum on average. That income requirement will ensure we prioritise the extra 15 hours of childcare for working families that need the most help with their childcare costs. Together with the existing universal entitlement, those parents will be entitled to double the childcare support they would normally receive.

The Secretary of State outlined on Second Reading that there will be a £100,000 income limit on the extended entitlement per year for each parent. That means any family in which either parent earns more than £100,000 or any sole parent who earns more than £100,000 will not be able to claim the extended entitlement. I can confirm that the increase in the minimum income level to 16 hours per week and the annual income cap of £100,000 will also apply to tax-free childcare. I am sure Committee members will agree that it is right to align eligibility conditions for the two schemes and focus support where it is needed most. Parents will be able to apply for both schemes at the same time, using a simple online system, as I have outlined.

The duty that the clause will place on the Secretary of State demonstrates the Government’s commitment to supporting working families. It will enable the Government  to deliver on their manifesto commitment and help to ensure that parents who wish to work or to work more hours are supported to do so through free childcare.

Photo of Pat Glass Pat Glass Shadow Minister (Education)

We have had a detailed discussion, but there are a number of assurances I would like the Minister to give, if he can. He said that the House will have the opportunity to debate and scrutinise the regulations at the highest level, but I am aware that he is looking to remove the House of Lords amendment further on in the Bill that states all regulations should be subject to the affirmative, rather than the negative, procedure. Can he confirm there will be an opportunity for the House to debate the regulations? There will be an awful lot in the regulations. It is right that they are made, but it is also right that the House gets an opportunity to debate them when the time comes and that they are not simply laid before Parliament and slipped out under the cover of darkness.

The Minister said that HMRC will have the resources and capacity to deliver the measure. He talked about the new IT system, which I hope is not linked in any way to the IT system used for universal credit; we would be very worried if that were the case.

It is a shame that the eligibility criteria have increased. The initial offer was 30 hours of free childcare to parents working more than eight hours a week. That has increased to 16 hours, with an income threshold, taking some of our poorest and most disadvantaged working parents out of the system. I understand that it is squeezed at the top, but it is a shame those parents have been taken out of the system in order for the Government to balance the books.

I am grateful that the Minister will look at the issue of children whose parents are in women’s refuges. I hope he will look again at the issue of nurses in training who will simply be taken out of the system wholesale, but I am grateful for his clarification.

Photo of Sam Gyimah Sam Gyimah The Parliamentary Under-Secretary of State for Education 3:45, 8 December 2015

I shall respond very briefly to the hon. Lady’s points. First, the Government will be proposing an affirmative debate on all the regulations on their first use. I am sure we will discuss that in due course.

Secondly, a bespoke IT system is being built. I have personally interrogated it. It is fantastic that, given the plethora of childcare offers out there, we are beginning to bring together the eligibility and application systems to make it easy for parents.

Thirdly, on the point about balancing the books, we have refined our eligibility criteria as we have gone through the process. Given that parents get 15 hours free, it is simply illogical to say that they have to work only an extra hour to get another 15 hours free. It is a question of not only balancing the books but refining the policy.

Fourthly, I take on board the hon. Lady’s point about nurses and grants. As with women in refuge centres, I will look at that issue and write to her to set out what else they could qualify for, given the number of childcare offers that are available.

Question put and agreed to.

Clause 2, as amended, accordingly ordered to stand part of the Bill.