Why today’s childcare changes won’t help the squeezed middle

The government’s plans will not undo the damage from cuts to tax credits and Sure Start.

We know parents are struggling with the cost of childcare right now. Under David Cameron, childcare costs are eating further and further into household incomes. Research from the Daycare Trust shows costs have risen by 7% in the last year alone, while average hourly earnings have fallen. In one central London nursery, you would have to pay an eye-watering £42,000 a year for one full-time nursery place.

At the same time, David Cameron has been cutting support to families, including cuts to tax credits, child benefit and maternity support. By the next election, families with children will have been hit with cuts of £15bn in financial support over the course of the parliament. By 2015, these cuts will amount to £7bn a year, ten times the value of the £750m in childcare support the government is now proposing.

Worse still, under the government’s childcare plans, not a single family will get a penny before May 2015. But families need real help coping with childcare bills this year, not a vague promise of help in two and a half years’ time.

Many low and middle income earners will lose out under these plans. Families claiming childcare support through tax credits have already seen this support cut by up to £1,560 a year, yet the government’s plans will not undo the damage for many of these families.

But while many families on modest incomes are losing out, if you earn £300,000 you will benefit. The government claims this is fair – but then this is the government that is prioritising a £100,000 tax break to millionaires, so we know what David Cameron’s definition of fairness is.

Many families will lose out in other ways too. A couple who both pay basic rate tax and have one child can currently get just over £1,800 in support through the childcare voucher scheme. Under the government’s plans, this will fall to £1,200 – another blow to household incomes.

So the childcare squeeze will continue. At the same time, the government is threatening the quality of childcare with their plans to increase the number of toddlers that nursery staff look after and there are now 401 fewer Sure Start Children’s Centres than in 2010.

The government should provide immediate help to families that are struggling, not just more vague promises of help further down the line.

David Cameron and Deputy Prime Minister Nick Clegg visit Wandsworth Day Nursery on March 19, 2013 in London. Photograph: Getty Images.

Stephen Twigg is shadow minister for constitutional reform and MP for Liverpool West Derby

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Why Theresa May can't end speculation of an early general election

Both Conservative and Labour MPs regard a contest next year as the solution to their problems. 

One of Theresa May’s first acts as a Conservative leadership candidate was to rule out an early general election. After a tumultuous 2015 contest and the EU referendum, her view was that the country required a period of stability (a view shared by voters). Many newly-elected Tory MPs, fearful of a Brexit-inspired Ukip or Liberal Democrat surge, supported her on this condition.

After entering Downing Street, May reaffirmed her stance. “The Prime Minister could not have been clearer,” a senior source told me. “There won’t be an early election.” Maintaining this pledge is an important part of May’s straight-talking image.

But though No.10 has wisely avoided publicly contemplating an election (unlike Gordon Brown), the question refuses to die. The Conservatives have a majority of just 12 - the smallest of any single-party government since 1974 - and, as David Cameron found, legislative defeats almost inevitably follow. May’s vow to lift the ban on new grammar schools looks to many like an unachievable task. Former education secretary Nicky Morgan and former business minister Anna Soubry are among the Tories leading the charge against the measure (which did not feature in the 2015 Conservative manifesto).  

To this problem, an early election appears to be the solution. The Tories retain a substantial opinion poll lead over Labour, the most divided opposition in recent history. An election victory would give May the mandate for new policies that she presently lacks.

“I don’t believe Theresa May wishes to hold an early election which there is evidence that the country doesn’t want and which, given the current state of the Labour Party, might be seen as opportunistic,” Nigel Lawson told today’s Times“If, however, the government were to find that it couldn’t get its legislation through the House of Commons, then a wholly new situation would arise.”

It is not only Conservatives who are keeping the possibility of an early election alive. Many Labour MPs are pleading for one in the belief that it would end Jeremy Corbyn’s leadership. An early contest would also pre-empt the boundary changes planned in 2018, which are forecast to cost the party 23 seats.

For Corbyn, the possibility of an election is a vital means of disciplining MPs. Allies also hope that the failed revolt against his leadership, which Labour members blame for the party’s unpopularity, would allow him to remain leader even if defeated.

Unlike her predecessors, May faces the obstacle of the Fixed-Term Parliaments Act (under which the next election will be on 7 May 2020). Yet it is not an insurmountable one. The legislation can be suspended with the backing of two-thirds of MPs, or through a vote of no confidence in the government. Alternatively, the act could simply be repealed or amended. Labour and the Liberal Democrats, who have demanded an early election, would struggle to resist May if she called their bluff.

To many, it simply looks like an offer too good to refuse. Which is why, however hard May swats this fly, it will keep coming back. 

George Eaton is political editor of the New Statesman.