States back free nursery cuts

Thursday 16 June 2016

Education Minister Rod Bryans has won the battle, if not the war, over his plans to means-test free nursery childcare.

After a sporadically heated seven-hour debate in the States Assembly, which finished late yesterday, Deputy Bryans had his plans ratified by members to the tune of 24 votes to 15, with five members abstaining.

The plans can only be fully endorsed within the Medium Term Financial Plan, which will be published on June 30. 

But as an indication for where Ministers are hoping to go, it is clear that means-testing is now a priority. 

Deputy Bryans initially pinpointed plans to cut nursery fee subsidies to families earning £75,000 or more, but that was changed earlier this week to families earning between £85,000 and £100,000 on sliding scale - with a saving to his department of around £250,00 a year. 

The changes are due to come in force in 2017 and the initial announcement in March was controversial, with parents, nurseries and politicians all claiming it would badly hit middle income families. 

Deputy Bryans said: "There has been a lot of discussion recently over my relationship with the Scrutiny Panel, but I hope we can now focus on the real issue of nursery provision here in Jersey. 

“The executive director of the Jersey Childcare Trust, an independent charity which provides services for parents and childcare providers in Jersey has written to me saying: 'Taking a realistic view of today’s economic climate, universal investment in childcare does not seem a possibility now, or in the future. The Nursery Education Funding in its current form is not sustainable, with current expenditure exceeding budget.' 

“The trust is pleased that the proposed baseline income level has been increased to £85,000 with a sliding scale, which offers a fairer approach. The trust supports this.

“Means testing as a principle is accepted as progressive measure. At the moment taxpayers are funding a universal benefit, for everybody, regardless of their earning capacity. So we have people earning hundreds of thousands of pounds receiving the same free hours of nursery care as people right at the bottom end of the earning scale.” 

At the moment, all children aged three and four and in the year before they start reception, get 20 hours of free care for 38 weeks per year in term time, at a cost to the States of £3,914 each.

Deputy Bryans said: “For some people four thousand pounds is a vast amount of money and a large chunk of their wages. For others, it is the difference between having, or not having, an extra holiday. What we are trying to do is re-calibrate and re-address the balance. 

“The current funding structure is simply unsustainable and the time is right to so something about this. The original principle was borne out of a time of relative plenty when the economy was booming. Times have changed and we are now having to ask ourselves much harder questions. 

“Every taxpayer will question why we are giving nearly £4,000 to people who don’t need it and can easily afford it? We need to look at the bigger picture and streamline our services.   

“The vast majority of Jersey families will not be affected by the change. We are not taking away the subsidy, we are means-testing it.

“Here is an opportunity to correct a mis-understanding, that a nursery is closing as a result of these proposals. That is not in fact the case at all. We received notification of the owner’s decision to retire due to ill health months before the Nursery Education Funding proposals.”

Under the Education Minister’s revised scheme funding would be reduced for families earning between £85,000 and £100,000, and cut entirely for anyone earning six figures.

The new subsidies would cover:

• Household income of £85,000 and below – 20 hours.
• Household income of £85,000 to £90,000 – 15 hours.
• Household income of £90,000 to £95,000 – 10 hours.
• Household income of £95,000 to £100,000 – 5 hours.
• Household income of £100,000 and above – not eligible.

But the minister’s attempt to find a half-way house didn't win over all in the assembly. 

Some argued that the Minister should have pulled the proposals entirely because they have not been properly thought through. There were also members who said the funding cut will affect young families, with a knock-on effect that would lead to fewer women in the workplace.