Childcare support?

The Government has announced proposals for a Tax-free Childcare scheme worth up to £1,200 per child. They say this will save a working family with two children under 12 up to £2,400 a year.

It will be phased in from autumn 2015, partly funded by the phasing out of childcare vouchers. and will ultimately be open to around 2.5 million families with children under 12. From the first year of operation, all children under 5 will be eligible, initially opening the scheme to 1.3 million families, and the scheme will build up over time to include children under 12.

To be eligible, families will have all parents in work, with each earning less than £150,000 a year, and will not already receive support through tax credits and later, Universal Credit. They will receive 20% – equivalent to the basic rate of tax – of their yearly childcare costs up to £6,000 per child.

It sounds like good news, so what’s the problem?

Well, first, you might ask is why this scheme is more than two years away. If it’s so important, why isn’t it being done now?

Secondly, while the Government is promising £750 million of support in 2015, it will also be cutting 10 times as much - £7 billion worth of support for families in 2015.

Thirdly, this scheme will not make up for families who have lost up to £1,500 in childcare support through cuts to tax credits. In total, this Government will have made £15 billion worth of cuts to family and childcare support between 2010 and 2015. This announcement won’t affect any of those cuts before 2015.

Finally, it will come as no surprise that at the same time as this government is giving massive tax cuts to millionaires, it is now introducing childcare support for families earning £300,000 a year at the same time as it is cutting Surestart schemes all over the country. It’s good to know we’re all in it together!

Encouraging small businesses to grow – or not!

Small and Medium Enterprises (SMEs) are key innovators and vital for economic growth. 

The Government is the UK’s biggest single consumer – the biggest purchaser of goods and services - but it is failing to ensure that public procurement is being used effectively to support SMEs across the country.

In February 2011, David Cameron and Cabinet Office Minister Francis Maude outlined Government procurement reforms. They both pledged to ensure that “25% of all government contracts are awarded to small and medium-sized enterprises”.  Of course, this promise got good headlines and supportive editorials in the media. However, like various other pledges, the Government has since dropped this as a target, and downgraded it to an “aspiration”. Not surprisingly, there has been little media comment about this.

At the beginning of March, the Cabinet Office published full year figures for procurement spend with SMEs across central government departments.  The figures show that the percentage of procurement spend with SMEs has actually decreased in the majority of government departments.

SMEs are very dependent upon good cash-flow. In 2011, the Government promised to pay all SME invoices within ten days, and that subcontractors would get paid at least within 30 days, and that it would "name and shame" large suppliers who fail to pay SMEs on time. 

But the latest Forum of Private Business research shows that 18 per cent of small businesses are still being paid late by the public sector.  And the survey found that nine per cent more members are reporting late payments from the government departments and agencies compared to 2009. Even worse, despite government promises of a concentrated effort to improve payment performance by major contractors, the latest  figures show the opposite.  The big outsourcers are getting worse, putting small companies that they subcontract the work to under enormous financial pressure.

So, despite all the rhetoric, the reality is that this government’s failure to procure from, and its late payment to, SMEs is threatening the survival of many small business and the country’s economic performance as a whole.

Are you female, born 1952-53? Read this!

The government is making huge changes to pensions, financial support for those working in low-paid jobs and with disabilities, and benefits for those out of work.

For the last year, I have been warning about the real impact of some of the cuts that are being implemented this year. It has been very difficult to get media attention – and, often, public attention – for these issues. The result is that the government has ploughed on regardless, until the very last minute.

A good example of this has been the ‘bedroom tax’. Last week, we saw last minute changes to try to exclude foster parents, service personnel and some families with disabled children from the scheme. None of these concerns was new. Some of us had been raising them for some time. There will be some horror stories yet to come from the other concerns that the government has failed to address.

So let me use this opportunity to flag up another issue, so that the government will have no excuse that it wasn’t warned.

The Government's latest proposal for a single tier pension will mean that about 430,000 women born between 6 April 1952 and 6 July 1953, will not qualify for the new pension but men of the same age will. That’s about 700 women in every parliamentary constituency. Those women will draw a state pension income of around £1,900 a year (£36.55 a week) less than a man of the same age and, even if they do receive their pension earlier, they are still likely to be worse off

Government Ministers claim that those women will be better off simply because they are allowed to retire earlier. It’s disingenuous. If these women are retired for 20 years they would lose considerably more than the pension received for the earlier retirement.

Don’t say you haven’t been warned. Make your views known now.

National Apprenticeship Week

Apprenticeships and other forms of vocational education traditionally offered a very clear path to a successful career for thousands of young people.

Apprenticeships are of enormous benefit, not only for each apprentice but also for the businesses training them. They can fill a skills gap and allow businesses the opportunity to match their future workforce around their specific needs. For apprentices there is the opportunity to learn on the job, build up knowledge and skills, gain qualifications and earn money all at the same time. They also gain excellent prospects for the future because they will have the knowledge and experience that employers really value and have been able to demonstrate a commitment to continuous learning and development.

Perhaps what has always been under-valued about apprenticeships is the part they played in the transition from childhood to adulthood, where supervisors and new workmates helped to keep them on the straight and narrow in their personal development as much as in their skills’ development.

Apprenticeship numbers fell dramatically during the late 1980s and early 1990s. The problem was exacerbated when the then Conservative government legislated to prevent councils from including minimum apprenticeship training requirements in their tenders for, for example, construction and highways’ schemes. The mantra was ‘The market will provide’. It didn’t.

Apprenticeship training collapsed. Many good local and regional construction companies were forced to cut their apprentice-training in the light of fierce competition from companies which didn’t invest in training. Unsurprisingly, this led to a shortage of electricians, plumbers, joiners, paviors and bricklayers. So, when the economy picked up, many private companies started importing skilled labour from abroad.

In 1997, there were just 65,000 apprenticeship starts in England. Between 1997 and 2010, the Labour governments invested more than £8 billion in apprenticeship training. In 2009/10, more than 273,000 young people started apprenticeship training – more than four times as many as 1997.

The 2009 Apprenticeships, Skills, Children and Learning Act was the first complete overhaul of apprenticeships’ legislation for more than 200 years. It established the entitlement to an apprenticeship place for every suitably qualified young person who wanted one. But, the coalition government has re-labeled all sorts of in-work short training courses as apprenticeships. They aren’t the apprenticeship schemes we need now and for the future.

Now, we have almost one million young people are now unemployed and the number out of work for more than 12 months has doubled in the last year. This is National Apprenticeship Week. The government could make a really positive step by announcing that all companies bidding for public contracts valued over £1m are required to demonstrate their commitment to apprentice training.

I’m pleased Sheffield City Council is one of a number of councils which are developing its procurement strategy to boost apprenticeship opportunities.

Making room

“We shouldn’t be financially supporting people to have bigger homes than they need.”

“If those living in homes with more rooms than they need moved somewhere smaller, then families who are over-crowded could be re-housed.”

Those statements seem entirely reasonable don’t they? In fact, many councils and housing associations have very good schemes to help tenants, in homes that are now larger than they need, to move somewhere smaller. But those schemes are very different from the Bedroom Tax that the government is now implementing.

In fact, the nature of the Bedroom Tax really tells us everything about the real values of David Cameron and Nick Clegg. 660,000 households are going to be hit. On average, they will lose £728 a year – about £14 a week. More than 10,000 families in Sheffield will be affected, and about 1250 in NE Derbyshire will lose out. In total, that will mean about an £8 million cut in money being spent locally.

The government says it’s targeting the skivers but the reality is very, very different. The Bedroom Tax unfair policy will mainly hit working households and some of the most vulnerable families.

Two thirds of the households hit are home to someone with a disability. Families of young soldiers serving our country will be penalised for keeping a bedroom where their son or daughter can stay when on leave. Bizarrely, if the bedroom is being kept for a son or daughter who’s been sent to prison, then you don’t get penalized. Foster families, who need a bedroom to respond urgently to provide a safe home for a child in danger are also going to be hit. As will thousands of ordinary working households of grandparents who have a bedroom in which their grandchildren can stay.

We can talk as much as we like about the general terms and the statistics. It’s when you see the real impact on real families that you know it’s going to hurt and damage.

And when, at the same time, 13,000 millionaires are getting a tax cut worth an average £100,000 a year, you know just how unfair it is.

Another myth bites the dust

Throughout history, at times of serious economic instability, we have seen how the politics of divide and rule have risen to prominence, often fueled by sections of the media. In this economic crisis, a whole range of scapegoats have been presented as the cause of our problems. Of course, issues which fit the currently dominant political ideology are likely to be promoted and repeated – never let the facts get in the way of the story you want to tell.

The Conservative-led coalition government has a very strong ideological view – put simply, ‘private-sector good; public-sector bad’. It not only wants to minimise the state – reflecting Margaret Thatcher’s ‘there’s no such thing as society’ – but it also wants, as far as possible, to privatise those things which it believes the state will have to do. People are only just beginning to realize how every part of our National Health Service is intended to be privatized.

Since the start of this economic crisis, government ministers – supported by various ideological friends and parts of the media – have been persistently promoting the view that there is a ‘public sector pay premium’. In other words, they have consistently alleged that public sector workers receive better pay and conditions than their counterparts in the private sector. For example, a big headline in the Daily Telegraph claimed that ‘public sector workers were ‘more than 40 per cent better off’ than employees in the private sector’.

Last week, a major study - ‘Public Sector Pay Premium’ – Fact or Fiction? by Income Data Services – simply blew apart the analysis on which these headlines and stories had been based.

Basically, the report said that ‘the substantial differences in income levels and occupational characteristics mean that average pay in any one sector will reflect all the complexity of skill mix, qualification, experience, responsibility, gender and seniority in each sector. This makes it even harder to draw simple comparisons.’ In other words, you shouldn’t compare apples and pears.

Further, IDS and other organisations consistently found that rather than there being a public sector ‘pay premium’, pay and conditions in the public sector are below those in the private sector for comparable roles.

Another myth bites the dust.

There’s a job to be done

Some thing strange is happening with the statistics relating to the economy and employment.

There is no disagreement that, at best, the economy is flat-lining. There is no growth and little prospect of growth given the coalition government’s economic policies. Some suggest that we have a triple-dip recession. That view is reinforced by the UK’s loss of its AAA credit rating this week.

Traditionally, such economic performance is reflected in increasing unemployment. However, over the last few months, there has been a fall in the headline rate of unemployment. Obviously that is welcome, but a combination of economic recession and falling unemployment is one that is mystifying all the experts. It’s counter-intuitive. So, we need to look behind the headlines to try to understand what is happening.

First, it is now clearer than ever that British workers are paying the price to get a job or keep a job. People have now taken an average £1,200 pay cut since the election because jobs are so hard to come by. Today we see there are more than five people chasing every vacancy.

Of course, pay and income cuts – particularly amongst those on low and medium incomes, who tend to spend nearly all their income – actually contribute to a lack of economic activity. The least wealthy areas are the hardest hit by this.

Secondly, youth unemployment has risen yet again. It is expected to burst back through the million mark this month. Most worrying, long-term youth unemployment has risen by 79% in the last year. 

Thirdly, the number of women out of work has gone up again, after a fall in the last period.

Fourthly, long-term unemployment is still far too high. It is long-term unemployment – especially amongst young people – that should most concern us. Have we forgotten the disastrous social and economic impact that this had on local communities after Margaret Thatcher’s pursuit of similar economic policies?

What Britain now needs from next month’s Budget is an industrial strength back to work programme to match the crisis we face. We need a Compulsory Jobs Guarantee to get anyone out of work for more than two years straight into a job – one that they would be required to take.

Time to get all fired up

Whilst the recent media attention has been about which animal should be listed on the contents of beef-burgers and lasagne, the government has quietly taken the first steps in its proposals to privatise the fire services.

A letter from fire minister Brandon Lewis to the chair of the House of Commons Regulatory Reform Committee has revealed that the government is set to put forward proposals “that would enable fire and rescue authorities in England to contract out their full range of services to a suitable provider.”

This would mean that fire stations in Derbyshire and South Yorkshire and their control staff and firefighters could be employed and run by a private company. All services, including special rescue work, could be outsourced or privatized.

The minister is seeking to push the changes through the little-known Regulatory Reform Committee, which means that the proposals would avoid full Parliamentary scrutiny.

I have to say that I firmly oppose these proposals and the way in which the government is trying to slip them through without having to answer some difficult questions. Fire and rescue is an essential service which we all depend on for our safety and, sometimes, our lives. Private sector obligations to deliver profits for shareholders are completely incompatible with the ethos of the Fire and Rescue Service, which puts public safety first.

Local people need to have confidence that fire-fighting in our area is being run for public protection, not company profit. The Olympics provided a forceful lesson that private firms often cost more and deliver less than promised when they bid to take over public services.

How happy would you be to learn that your fire service had been outsourced to G4S, which had then sub-contracted the supplies of ladders to Bob’s Window Cleaners, fire engines to Kerbside Motors, and fire-fighters to ATOS?

Not a sure start

The last Labour government implemented a programme to try to ensure that every child gets the best start in life. More than 3,600 Sure Start Children’s Centres were developed offering permanent universal provision in every area in the country. Nearly 3 million young children and their families currently use these Centres, which include integrated early education and childcare, child and family health and support services, and links to employment services such as Jobcentre Plus and training providers.

Before the last general election, serious questions were raised about the political parties’ commitments to the Sure Start programme.

When challenged, David Cameron, Conservative Party Leader and now Prime Minister, said he was affronted that it was being suggested that the Conservatives didn’t support Sure Start and said “I want not just to repeat our commitment to keep Sure Start, but to set out how we will improve Sure Start.”

Liberal Democrat Leader, and now Deputy Prime Minister, Nick Clegg said: “Sure Start is a really important programme that has made a real difference to millions of parents. Difficult decisions are going to have to be made in public spending, but Sure Start is one of the best things the last government has done and I want all these centres to stay open.”

Last month, the House of Commons Library confirmed that, since 2010, the Early Intervention Grant, which supports the funding of Sure Start had been cut by more than 40%. The cuts for each council range from 33% to 48%.

Councils with the highest levels of deprivation have already suffered the biggest cuts, and will suffer even bigger cuts over the next 3 years. Locally, the Early Intervention Grant allocation cuts between 2010/11 and 2013/14 are Barnsley – 45.6%, Doncaster - 46%, Rotherham - 46.4%, Sheffield -45.6%, Nottinghamshire – 42.8%, Derbyshire – 38.3%.

As a result, more than 400 Sure Start centres have already closed. Many more face closure or being required to make significant cuts in provision over the next year. 55% of centres already report that they have stopped providing on-site daycare.

When the coalition government is cutting Sure Start – in direct contradiction to the promises made – at the same time as it is giving millionaires a £100,000 tax cut, it is difficult to believe that it has its priorities right.

It’s a Smaller Society

We haven’t heard much from David Cameron recently about his flagship Big Society policy. Launched in 2009, and then a centre-piece of the Conservative 2010 general election manifesto, Big Society was meant to re-frame the relationship between the state, local communities and individuals.

Last month, Sir Stephen Bubb, speaking for the heads of Britain’s biggest charities, said that the Big Society idea was “effectively dead”. Actually, it’s even worse than that. Cameron’s coalition government seems to have been relentlessly pursuing policies that mean we’ll have a much smaller society than the one they inherited.

The government’s Work Programme was meant to be a shining example of the new type of relationship between the government and the voluntary sector. .As well as failing to meet any of its objectives, Bubb described it as a scheme where “reality is divorced from the rhetoric”.

The government promised that it would speed up payments to small businesses (SMEs) and charities. Yet, the latest data shows that late payments and the average time to pay against invoices have both increased.

Far from increasing support to charities and voluntary organizations, the government is planning massive cuts in financial support. Government spending on the sector will fall by £3.3bn between 2010 and 2015. The biggest fall will occur in 2015, when expenditure from local and central government sources is expected drop by almost £1.3bn in real terms compared with 2010 levels. Little wonder that about a half of all charities are predicting significant cuts in the services they provide and the number of employees and volunteers they have to deliver them.

The UK Giving Report, published in November, found that donations to charity have fallen to £9.3bn, down £1.7bn on 2010/11 (£11bn) in cash terms. That’s about a 20% cut in real terms. And the survey found that the proportion of people donating to charity is also falling.

And, despite the massive tax cuts being given to the highest earners, there’s no evidence to show that they are giving some of that to charity. In fact, the number of big charitable donations has fallen to the lowest level in 5 years.

We have a smaller society, and it’s getting smaller every day.