Social Justice and Social Security Committee

Meeting date: Thursday, June 29, 2023

Official Report 628KB pdf

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Child Poverty and Parental Employment Inquiry

The next item is an evidence session with a panel of employers as part of our inquiry into addressing child poverty through parental employment. Last week, we started looking into the need for flexible and family-friendly working, with a panel focusing on policy and a panel of business representatives. Today, we will hear from employers. I welcome our panel. Helen Herd is head of human resources for Highlands and Islands Enterprise; Rachel Hunter is director of enterprise support for Highlands and Islands Enterprise; Heather Melville-Hume is senior HR manager for Independent Living Fund Scotland; and Harvey Tilley is the chief operating officer for Independent Living Fund Scotland. They join us in the room, and Andy Wood, who is people services lead for the Wheatley Group, joins us remotely. Thank you all for accepting our invitation.

There are a few points to mention about the format of the meeting before we start. We have approximately one hour in which we will ask you some questions. Please wait until I say, or the member asking the question says your name before speaking. Andy, and members who join us online, please allow our broadcasting colleagues a few seconds to turn your microphone on before you start to speak, and you can indicate with an R in the dialogue box in BlueJeans if you wish to come in on a question. Do not feel that you all have to answer every single question; if you have nothing new to add to what has been said by others, that is okay. I ask everyone to keep questions and answers as concise as possible.

I invite members to ask questions in turn. First, I introduce Miles Briggs.

Good morning. Thank you for joining us. I will start with a question about the challenges for businesses, because we have been hearing about flexibility and potential flexibility in business. I want to find out what you believe the current challenges are for employers and how they might impact on efforts to provide a more fair, flexible and family-friendly working environment. I do not know who wants to kick off. Maybe we could start at one end of the panel, with Rachel Hunter.

Thanks. The feedback that we are getting from employers across the Highlands and Islands is that the big challenge at the moment is the cost of doing business: the cost of materials and other inputs. Due to inflationary pressures, there are significant increases in costs. There are also associated supply chain disruptions being caused by the war in Ukraine.

The other key area that comes across is recruitment. The labour market in the Highlands and Islands is particularly tight in some sectors, particularly construction, tourism and hospitality. Employers are finding it hard to get permanent staff and seasonal staff for this time of year. One of the recent business panel surveys also suggested that employers were concerned about their staff’s wellbeing post-Covid and about burn-out because of the amount of change that they are going through.

A range of issues are challenging employers, and it is difficult for them to focus on the long term because of those immediate challenges.

From the point of view of Highlands and Islands Enterprise as an employer, recruitment and the ability to attract and retain talent are key. We are quite lucky in that sense. We have done a lot of work on the type of offering that we can give to our employees. However, it is a constant challenge, and people expect a lot more flexibility in the kind of work that they can do, where they can do it from and the level of work that they want to do. Being able to respond to that is key for us.

Our organisation is very similar to Highlands and Islands Enterprise, which has a very flexible working posture. In our organisation, we call it “life-friendly” working rather than “family-friendly” working because there is equity in the offer to every individual, no matter whether they are single, own pets or have caring responsibilities. We have extensive policies, copies of which we have included in members’ briefing packs. I argue that we are at the forefront of that.

As you said, however, there are some barriers for us. We work with more than 8,000 disabled people—it says 5,000 here—across Scotland and Northern Ireland. Certainly, what we see is that the equity in what we offer our staff, many of whom are disabled or have long-term health conditions, is not the same for the individuals to whom we provide funding to live independently with choice, control and dignity.

We pay the Scottish living wage to all our recipients so that they can fund their own support and care. Obviously, however, there are recruitment issues, which we have already talked about and which you will be familiar with in health and social care. Often, there is very little money for those individuals and—I am not being critical—it is relatively low-paid work, and they have to procure childcare alongside that. When we moved up to Scotland, my wife and I were both working and our childcare cost over £2,000 a month. I was working in London, and my wife’s job took her all over Scotland, so it was very expensive. That expense, the cost of living and all the things that we have talked about are a real problem.

We provide a very good set of supports for our staff and an extensive set of policies, which we have publicised widely. For me, there is a bit around equity of offer, certainly to carers, family members, disabled people who employ personal assistants, and personal assistants themselves, to provide that same level of support. That is something that we would like to explore further.

The other thing is about providing information to individuals. We work very closely with Flexibility Works and with Working Families, which is based in London. Often, people do not have the right information easily accessible to them at the right time, so that they can ask their employers about the right to work flexibly and all of those things.

Interestingly, one of the plus sides of Covid was that we were allowed to step much further forward into the flexible working space. We are hearing quite a lot of rhetoric on that, but the reality, if you read the wider press, is that companies are retrenching into a pre-Covid posture. That is absolutely their right but, ultimately, the whole balance is something that fits the employee and the employer.

Thank you for inviting us today. I will reiterate what other witnesses have said. What is needed is a combination of affordable care, not just childcare, with flexible working options. The only thing that I would add is the need for a collaborative approach to ensure that the employer and the employee are able to make informed choices. There needs to be education and signposting. Making the right information available is really helpful in enabling conversations about flexible working options to happen. It is not just about a four-day week or compressed hours. Life ebbs and flows, and so should flexible working options. I feel very fortunate that we are able to do that in ILF—as, I am sure, other employers do.

I would echo the two main points that the other witnesses have made. Our challenges are the same. It is about how to best support our employees through the cost of living crisis. Aside from affordable pay rises, what other avenues are there to support people with regular costs that they may have? We do a lot of our work through our WE benefit scheme and our health plan, which provides employees with contributions to dental and optician costs and driving lessons. Those are practical measures to help to alleviate some of the other financial constraints or pressures that they may be under. One of our subsidiaries is Wheatley Care. The recruitment challenge in that is not new; it is on-going. One of the other witnesses spoke to that. It is unfortunately not the best-funded sector. It is a challenge for us, as an employer, to make an attractive employment proposition for applicants.

Good morning, panel. You have touched on my first question. If you have workers whose jobs require them to be physically present at a specific workplace, how do you support them to balance work and family life?

Very few of our workers need to be in a particular location at a particular time. It is the case for some reception and facilities management staff but, pretty much, we can offer options for hybrid working and a whole range of flexibility locally and informally around start and finish times. There is flexibility around well-resourced special leave provision to deal with domestic situations and family commitments, as well as caring commitments. In our organisation, a number of staff are slightly elderly, in that they are 45-plus, and different types of caring issues come into play.

We can take a whole range of approaches that reflect the different positions that people can be in at different times in their career—the whole employee life cycle from when you start with an organisation, through what might happen to you during your time there, until you leave the organisation. It is about being tailored and responsive, recognising that there will be different needs at different times and working around that.

We need a number of employees in the office in Livingston, which is essentially our central point of contact. Heather Melville-Hume will talk about some of the provision that we put in place to enable them to be flexible, but the reason why we need them to go in is that some of the disabled people we interact with are not online and do not like that medium of communicating. They also like hard copy. Often, when they come to reviews and discussions, having the hard-copy paperwork in front of them makes that discussion much easier.

Through Covid, we thought about whether we should just not be in the office at all. The reality is that we get mail coming in and out each day—and there are mechanisms to do that—but, also, we find that there is mutual support in having colleagues in the office. There is loads of flexibility around the days that they come into the office. For us, a core thing is to have people in the office to enable our service to function to support disabled people.

The focus of ILF has always been on the inclusive culture of bringing yourself to work. We want to offer to our staff the same dignity and respect that we offer to our recipients. We talk a lot about no conversation being off the table. Helen Herd talked about people’s needs. It is about ensuring that our managers feel comfortable and capable but also that our staff feel enabled to have open conversations and to say, “This is what I am looking for.” In our policy, we offer staff flexibility for life events. That policy is not just a document; it is living and breathing. It is about working with the individual and ensuring that that supports the team and the service, just as we do with our disabled recipients, because we are all individuals.

09:15  

It is important to note that, although some staff are more centred around the office location—two thirds are home based or hybrid—100 per cent of staff have flexible working.

A significant part of our workforce is site based or office based because of the nature of the roles in the group, primarily within our environmental and care settings. To echo what some other witnesses have said, it is important to give people who are working in those roles as much advance notice as possible of when they are required to work, so that they can plan their external non-work activities around that. We normally have a seven-week lead-in time for shift patterns. We also have a range of policies that allow for time off for a variety of scenarios, such as for carers, emergencies or dependency leave. Over and above that, there is a culture in the organisation that staff can approach managers and be very comfortable in asking for time off, assistance or support outwith what may be stated in the policy. With the best will in the world, the policy cannot cover every eventuality so, over and above that, we have a culture in which staff are comfortable approaching managers and asking for time off or support, as and when required.

We would be keen to see a bit more research on that and the outcome of the pilots that will run. It is certainly something that we would consider, but it is one element of flexibility among a range of other elements. You will not get something that suits everybody. It has to reflect the nature of your business as well.

We have quite a range of flexible options. A lot of our staff work compressed hours; effectively, they may work a four-day week or a four-and-a-half-day fortnight. There are indications that it certainly does not have a negative impact on productivity and that it could well be beneficial. There has been positive feedback from individuals who have had the opportunity to do that. It is about taking all that into account and being open to seeing what will work.

I think that the four-day working week is a bit of a red herring. I do not think that there is a binary question about going from a five-day to a four-day working week. We have looked at this extensively over the past four or five years. We have put in various submissions looking at how we pilot those thoughts. Essentially, it is about looking at reduced hours. For me, flexible working is about working, ultimately, when it suits the business but also when it suits the individual. It may be that they take those reduced hours over three days, or they may take them over six days because that works better for them. It is not about a binary question on a four-day working week, although I absolutely agree that lots of research is being done in that space.

We are looking at moving down to 35 hours. At the moment, we work 37 hours. However, following the pay policy, we have an hour for health and wellbeing, so, essentially, it is 36 hours, but we are looking at going down to a 35-hour week. We have done lots of consultation work with staff. The major theme from staff is that we have very high workloads because we are in a fiscal environment where resources are scarce, so how do we balance that? Reducing hours when our workload is ever increasing is almost a contradiction. However, there are efficiencies that can be made. Ultimately, happy staff are productive staff. It is not rocket science.

We are a small organisation, but we are hugely effective and efficient in what we do. Since we started in 2015, we have had more than 100 working patterns. For a staff of just under 70, 100 working patterns have been looked at and worked. That tells you what flexibility looks and feels like. It is not just about having a four-day week; it is about what suits the individual and delivery, and having such conversations from recruitment. We talk about flexible working and have those conversations straight from the advert, because we want to create the best environment for the individual to deliver for us and our disabled recipients. Enabling other small employers to do the same would be a real step change for many organisations.

Thank you for those helpful comments.

Andy, do you want to come in before I hand back to the convener?

No, thanks.

As a mum, I know that, when you have a child in childcare, it is challenging to get a phone call from the nursery to say that your child is not well and you have to pick them up. More often than not, women have to do that. It is a struggle to have to make up the time up or take annual leave. Women are disproportionately impacted. What are your thoughts on having more flexibility in that regard?

During Covid, there was very much a balance in ILF between caring responsibilities and work. Although I was not with ILF at the time, one thing that was shared was that it was about what a person could do and saying, “You can only do what you can do, and life comes first.” Because our staff are committed to and engaged in what they do, it is not necessarily about making up time; it is about recognising that they need to balance that and the manager then being able to flex that workload. I think that, in Scotland, 42 per cent of women are responsible in that way, so you are right that there is a disproportionate impact. We assess the impact of every policy or practice that we look at. It is essential that employers can look at the wider picture and tap into advice and guidance to do that.

I am a working parent, as is my wife. My wife works away quite a lot, and my job enables her to do her senior role elsewhere. I get calls such as you mentioned, and I often have to pick up a child, although I recognise that the burden of that falls on women. There is an increasing number of men in the school playground, but the vast majority of the people who pick up children are women. That means that they get called and that the onus is on them to pick up children.

ILF does not request that anybody make up time if they have family emergencies. We find that there are swings and roundabouts. We do not monitor anyone; we trust people to do their job, and we do not monitor their hours. Although I might do only 20 hours this week, in subsequent weeks I will make up the time. We have never had to monitor or enforce anything. We have found that the return on that is loyalty from highly productive and happy staff who can deal not just with children but with other caring responsibilities.

That is really reassuring.

I could not have said it better. Flexibility is essential. It needs to be recognised that there will be immediate situations that need to be dealt with. The safety net of knowing that they can be dealt with while having the support of your employer is very reassuring. In a give-and-take culture, there will be different requirements at different times. Employers are paid back in spades for that type of approach, which all comes down to trust. We do not monitor, but we know when things are not working. It is therefore necessary to keep an eye on that. The overwhelming response that we get from our staff is that they appreciate the approach.

At Wheatley Housing Group, we have enshrined in our policies emergency leave that covers exactly the scenario that you have described, where childcare has been withdrawn or is not possible or where the child is ill. We provide paid leave for unforeseen circumstances, and there is no requirement for the individual to pay back any time that has been given. As a result of Covid—this was the one plus that came out of it—45 per cent of our roles have moved to home-working contracts. In their contracts, employees have the flexibility to choose when they work, so there is in-built flexibility if they need to pick up a child from school or nursery. Doing that does not impact on their contractual obligation.

Part of my question has been answered in the previous responses. Andy Wood touched on the great amount of home working that you offer and the flexibility that workers have, but how do you ensure that an employee with, for example, additional caring responsibilities for a disabled child is supported by more than just flexible working arrangements?

We have a number of ways in which we support staff in such situations. In a recent survey, 47 per cent of our staff stated that they had some sort of caring responsibility, whether for a child, an adult or a partner. First and foremost, we have a number of staff groups, one of which is our very active carers group. It is sponsored by a member of our executive team and comprises colleagues across all levels of the business sharing their experiences and their support.

As part of that, we have brought in speakers from external organisations to signpost staff who have caring responsibilities to support. For example, they can receive grants. We have internal knowledge through our welfare benefits and money adviser roles. Again, those can be used to signpost our staff to grant support and to where they can get adaptations to their house. We also provide six paid days of carers leave for staff. Where staff are based on site or at a working location, we have a commitment to try, where possible, to ensure that that is as close as possible to their home or the caring location so that their travel time is minimised as far as possible. Those are the main supportive measures that we have in place.

What advice would you give to other employers who are seeking to be more flexible and family friendly? I will come back to the rest of the panel on that.

We need to realise that what might be considered flexibility for one is not flexibility for another; everybody has their own needs. You have to ask the question, you have to listen to the responses and you have to be open to trying new approaches. Some flexible-working requests may come up that you have not tried to meet before. For example, Wheatley group introduced term-time working several years ago. We had not looked at that before, and it proved to be very popular. Now that we have moved to home working, we do not get as many requests for term-time working as we previously did, so that was something new for us. Other witnesses have talked about buy-in and motivation—you want a contented workforce. We got a very positive response to that measure, because we listened—it was put in place following requests from staff and feedback on what we were not providing that would suit their work-life balance.

09:30  

ILF has a suite of policies. More important is that it is not just about what is on paper; it is about practice and enabling that. It comes down to culture, with employers enabling and encouraging those conversations and gathering feedback from staff and colleagues. We do much more; we go above and beyond when it comes to our policies. We have a bereavement policy, and we have signed up to a bereavement charter that recognises the impact of bereavement. We also have monthly health and wellbeing sessions. There is a need to have difficult conversations on some challenging subjects, given their financial impacts. We ran a financial wellbeing seminar, which was about enabling and signposting people.

There are some really challenging subjects, so signposting is required, because one size does not fit all. We need to enable people to make informed choices, to take that time and to work flexibly to support themselves and get that work-life balance.

We have used a staff survey as a useful way of co-creating our suite of supports for individuals. I remember a colleague saying to me, “I haven’t got children, but I’ve got two pets, and they’re everything to me. They are my life.” One of their pets was really poorly, so they had to take it to the vet. There was that side of things to deal with. We were worried about the consequences for their work—we had only just started ILF—so we created a pet-leave policy as part of our suite.

We have talked about the idea of allowing people time off for dependants—ours is two or three weeks. There is also carers leave and all the other things. It sounds excessive, but the return that we get from that is that we are a highly productive public body that delivers the best support for disabled people on behalf of the Scottish and Northern Ireland Governments. For me, it is just not rocket science.

That is good to know. As a dog owner, I am delighted to hear that, because I know the challenges that I face in trying to get dog care. That is a really good policy to bring in.

Generally, we need to promote the significant business benefits of a family-friendly working policy. Increased motivation and productivity have been mentioned. We have seen that, and studies by the Fraser of Allander Institute have shown it to be the case. Staff are also less likely to be off ill—there are reduced sickness rates—and are happy to go the extra mile. It is also good for customers, because people want to buy products and services from good ethical employers. It enhances brands and reputations if employers look after their staff and have a range of policies to support them.

Business reputation and recognition are really important as well, and such policies enhance that reputation and recognition. I always think that, when you speak to employers about fair work, you should ask what your staff say about you behind your back, because that is what they will say to prospective employees of your organisation. Do they say good things about you? Are you a supportive employer? If you are, they will say that to other people whom you may want to recruit in the future. We have already spoken about the challenges around recruitment: having a good reputation as a family-friendly employer will help with recruitment in the long term.

There was a question about the kind of advice that we would give. Flexible working is but one part of a whole approach to fair work. Having engaged employees who have an effective voice, and who have opportunities, security, fulfilment and respect are parts of that one thing. Line managers are the key interface between the organisation and its staff, and they will influence the experience that individuals have. As has been said, you can have a suite of wonderful policies, but if they are not reflected in the discussions that take place and the support from line managers, that is where it can fall down.

It is necessary to be up front in recruitment. We say in our adverts that we are happy to talk about flexible working; there is a recognition of the need to have an open discussion, up front at the recruitment stage, and to build trust. That makes for a better relationship. All those things working together will support family-friendly flexible working, but a holistic approach is needed.

Do not underestimate the value of having such conversations and offering flexibility. I have had conversations with individuals about the positive impact on their mental wellbeing. It goes back to having a positive, contented and happy workforce. A number of people across the industry and practitioners whom I have worked with have said, that flexible working has literally kept them employed and has enabled them to live a life and support their families, whatever the make-up of the flexible working is. The positive impact on mental wellbeing and resilience, particularly in today’s climate, cannot be overstated. Small employers and other employers that are looking for advice need to see the value in that.

That leads neatly to my line of questioning. We have heard about how best practice and flexibility helps to retain staff and so on. If we are going to help parents out of poverty, the other aspect is encouraging employers to pay the real living wage. My question is about support for businesses. How do we improve engagement with businesses in order to provide practical advice so that the benefits that you guys have witnessed of having flexible working and paying at least the real living wage can be rolled out to the 85,000 micro and small businesses in Scotland? How do we improve that engagement and promote what you guys have spoken about?

I do not underestimate the fact that we are in the fortunate position of being fully funded. We act on Government policy that is forward thinking—rightly so—and progressively positive. We run an efficient organisation, but considerations of profit and loss or rising energy costs are not as much to the front of our thinking when it comes to paying the Scottish living wage. I am confident that all our employees get more than the Scottish living wage, but I do not underestimate the challenge.

You asked what we could do. There is a lot more advice, and there is the need to promote the benefits that we have talked about, but there is, ultimately, a financial issue for organisations that are already on a tightrope in relation to being solvent or insolvent, so offering the nirvana of the Scottish living wage or higher pay is sometimes very difficult. Could tax breaks be given or could other things be done at system or Government level to ensure that the benefits are spread across micro and small businesses? It is a very difficult question to resolve.

You are right that it is a difficult question, but surely it is about promoting the benefits. If you pay the real living wage, you reduce your recruitment costs because you do not have staff turnover, and your training costs do not increase because you retain staff.

I am 100 per cent in vehement agreement with you about that, but my friends who have businesses say to me, “That is all well and good, but I am fighting for the financial survival of my business.” Some things take longer to bed in, and the next things to consider are rent rates and the rising cost of materials. All the things that you have said make absolute business sense to me; if I had a small business, I would want to do that. However, although I am not a business owner, I recognise the challenges in that regard for people I know.

Highlands and Islands Enterprise has spent a lot of time promoting business benefits and has various case studies involving micro and small businesses from across the region, including in remote and rural areas. Wages are rising and, as has been said, we have a tight labour market. The deputy convener is right that, when we speak with businesses, we have to look at the longer term. Businesses want to retain their staff, and we have to think about the additional recruitment costs of constant staff churn. Staff can just go elsewhere and find a better-paid job, so there are additional costs involved in retraining and readvertising jobs successively. Some employers find it a challenge to keep up with annual wage rises.

Small businesses engage with business intermediaries such as banks, accountants, other advisers, trade bodies and membership organisations, and we need to make sure that those organisations understand the benefits of flexible family-friendly working policies, because they are the people with whom small businesses interact from day to day. They, too, need to be genned up on what the benefits are. It is not just about Government agencies providing case studies and so on.

Highlands and Islands Enterprise has a programme of specialist HR support that small businesses can use to help them to develop a fair work action plan. That allows them to understand the benefits and the longer-term financial impacts of paying the real living wage.

We will probably speak about fair work conditionality, but Highlands and Islands Enterprise has always taken the carrot approach by promoting the benefits of fair work and considering how we can get businesses on the journey before thinking about using the stick of conditionality.

I will add to that. I recognise that a lot of micro, small and medium-sized businesses do not have the access to HR resources that other organisations have; they do not have subject matter experts. In relation to how we influence and manage policy, we need to give them access to that and recognise that the people from whom they are getting that advice at the moment are under huge pressure. From some of the voluntary work that I do—I have capacity to do that because of the organisation that I work for—I know that people tap into such resources all the time. They say, “I didn’t know about that” or, “Where can I get signposted to that?” A lot of bodies are able to promote and support such work, but we also need to give business enterprises and other agencies more funding to support small and medium-sized businesses, to enable them to tap into experience and up-to-date knowledge and to support the conversations that need to be had.

On that point, we heard last week that new legislation is coming in across the United Kingdom to introduce a day 1 right to flexible working, but that 49 per cent of businesses are unaware of that.

I know.

Is there a need for a business mentoring system to be introduced? If so, who would run it? Would it be the likes of Highlands and Islands Enterprise?

09:45  

Again, we need to promote such things through intermediaries, especially banks. We have to think about the organisations that businesses interact with. Enterprise agencies probably deal with only a certain section of businesses in particular regions. Business Gateway and local authorities could help to promote the new policy. It is challenging for very small businesses to keep up with the latest legislation, so we need to make sure that those who support small businesses are aware of the changes. Enterprise agencies run mentoring schemes, so those schemes and whatever else could be built in. However, it is more about promoting such things through business intermediaries.

I will reiterate what the other witnesses have said. Some small organisations might be willing and keen to try flexible working because it might bring them added benefits. However, the issue with putting in place flexible working arrangements is getting them off the ground through having knowledge and access to support, and understanding the legal, practical and financial implications. A central body or team of advisers who could assist businesses to do that could only be beneficial in driving uptake of flexible working practices.

As was stated, we need to raise awareness of the changes that are coming down the track quite soon in order to ensure compliance. It was also mentioned that it could be useful to have case studies of small organisations for which such practices have worked. Those could be warts-and-all studies that describe the challenges and the potholes in the road on the journey, but they could also set out the benefits of embracing flexible working.

I often think about practical solutions and what can be achieved. We work with thousands of disabled people and, through them, thousands of PAs. The Scottish Government has done a lot in recent years to promote things such as the Scottish living wage, and it is investing in the health and social care environment, but procurement is a real issue. We could lead the way by requiring that all tenders that go out for health and social care contracts have fair work at their core, and by providing funding to ensure that that is given over to the staff and employees at those organisations.

We provide a quarter of all the direct payments to disabled people in Scotland. We make some provision for firms to be good employers, but we are limited in the amount of money that we can provide because of the wider environment. However, direct payments are a direct way of influencing things. We can make sure that those disabled people are able to become even better employees than they already are. We should use procurement frameworks to invest and to articulate the requirements of funding bodies in relation to things such as fair work. That is a really practical way forward, and it could be achieved relatively quickly. We have a good set of suggestions.

My final point is on the issue that you have just raised. You are right that procurement law can be used to promote the real living wage and flexibility. Last week, the Scottish Trades Union Congress called for employment law to be devolved. Would not it be easier if we had the powers to do something about these issues, rather than playing about with procurement regulations?

That is an interesting question. I am not quite sure how to answer it.

Devolved legislation has absolutely benefited Scottish citizens. The problem with procurement is that it often looks for the lowest cost. To answer your specific question, I do not disagree that it would benefit the citizens of Scotland if some of those issues could be devolved. I am not a constitutional lawyer, so it is a bit hard for me to think through that, but it certainly makes sense for citizens of Scotland to have devolved powers over employment law. On a broader practical level, let us not look for the employer or the bid with the lowest cost, which is how everything is configured under procurement frameworks; instead, let us ensure that fair work comes right through that process.

That is helpful.

I will bring in Jeremy Balfour before I bring in Paul O’Kane, because Jeremy has to leave us at 10 o’clock.

Good morning, panel, and thank you very much for the evidence that you have given so far.

The committee is a wee bit central-Scotland based and, from previous sessions, we are aware that people who live in rural Scotland may have extra issues compared with us city slickers. For low-income working parents in particular, what can businesses and employers do to address issues such as transport, childcare and affordable housing, particularly in rural areas? I will start with Helen Herd.

It is clear that there are different issues in rural areas, where there might not be a critical mass of available services and provision. We hear from working parents that childcare needs to be affordable and accessible, and that there are issues with the times and locations at which it is provided. So much can be provided by private providers, but there is probably a case for some kind of subsidy or support to fill the gap because, if you are trying to have a viable business providing childcare, a whole lot of issues come into sharper focus when you look at more sparsely populated rural areas.

The regulations and the ratios for childcare are very much skewed towards urban settings. In childcare provision in rural areas, particularly in very small islands, you just cannot get economies of scale.

Childminding is seen as a really good flexible option in very remote and rural areas. However, one of the challenges is that it is usually a parent—usually a mother—who sets up a childminding business. They have their own children, but they do not get any payments for them, which compounds the financial burden of setting up the business.

HIE has been working with the Scottish Childminding Association. We have seen around 30 new childminding organisations being set up across the region, but there are still pockets in particular areas in island communities in which there is currently no provision. That is a real challenge.

One of the big challenges—I am from Shetland, so I have been through all this—is that people might have to move their children throughout the working day. They might have to put them in a breakfast club, then have to get them to school, then they might then have to get them to a childminder after school. We hear lots of stories of stressed-out parents who have to move their children around through the working day.

The existing infrastructure is one thing that we really need to look at. If kids have a breakfast club and an after-school club at school, for example, parents will not have to move them around during the working day.

We are also looking at a cradle-to-grave pilot, in which a care facility can be used for older people and for children. They can be in one facility. Let us use the infrastructure that we have a bit more creatively and wisely.

Obviously, the other challenge is in recruitment in childcare. We simply do not have enough people for the ratios in the Highlands and Islands. That is a big problem in rural Scotland. We are keen to work with the Scottish Government, and we are already working with some parts of it, including the islands team, to look at that problem and address the issues.

The issue is not solely childcare; it is care in general. It is about care for young disabled children, care for children and young people with additional needs, and care for disabled people across the country, particularly in rural areas. Key to that is using the existing infrastructure, but we must also be able to ensure that care is not focused purely on children.

That is really helpful.

At the beginning of the year, the committee visited Uist. It was really interesting to see the distances that have to be travelled to get care for older people or younger people. Rachel Hunter said that HIE is working with the Scottish Government.

Yes.

Can the Scottish Government do more to help rural island communities in particular with flexibility? The model of everything happening in school, rather than people having to move around during the day, is very interesting. Are there models out there? Can the Scottish Government do more to support that?

The Scottish Government can help. You are talking aboot a multifaceted issue in that you are talking about the school estate, childminders and local authority providers. It is about getting people in those areas joined up to work together and to think of the challenges from the parents’ point of view. People might be able to find childcare from 8 am to 6 pm, but they have to move kids around during the day or travel huge distances. We need to try to think from the customers’ point of view. I think that the Scottish Government could help to bring together the key organisations and different parts of Government.

I want to expand on the conversation about rural locations and ask about childcare more broadly. A lot of the conversations in the committee have been about the expansion of funded childcare to 1,140 hours a year. Discussions are on-going about how that might be widened to include one and two-year-olds. Does the panel have a view on whether further state-funded childcare would be beneficial? How can we ensure that flexibility?

I am not sure who wants to come in on that. Rachel Hunter was on a roll.

I would say that the answer to that is that it would absolutely be beneficial. There should be childcare from birth, or from the time when the parents want or the mother wants to move back into the workplace or do other things. They should absolutely have affordable childcare as pretty much a day 1 right, which means expanding the age range. I am in vehement agreement about having more hours and a wider range. That would have a significant impact on all the issues that the committee is trying to challenge.

I completely and vehemently agree. When we look at the returns on investment, we see that there are economic, wellbeing, education and development returns. That is key to everything.

Research has been done by Flexibility Works. It is almost about selling the benefits that can be achieved by having greater flexibility and such support; they include productivity, loyalty, retention, business costs, the impact on mental health and wellbeing, delivery, engagement and reduced sickness. An abundance of really important measures can be influenced by having that focus.

Childcare is a public good. We will not see our overall economy thrive without increasing support for childcare and more investment in it through funded places.

10:00  

In Scotland, we often compare ourselves with the Scandinavian countries. I have friends in Norway who get childcare from 8 o’clock in the morning until 6 o’clock at night, wherever they are. A daily stress is taken away. If we are modelling ourselves on those countries, or that type of economy, that is where we need to go.

Does Andy Wood want to come in at all? I see that he does not. Okay. Does Paul O’Kane have any further questions?

No, convener. In the interests of time, I am happy to hand back to you.

Okay. We have come to the end of our questions. I thank all our witnesses for taking part in the meeting and sharing their expertise. We will continue with the inquiry in September, as this is our last day before we go into recess—that is why you see lots of smiley faces here today. We will continue with the theme then—in particular, on transport and the challenges that it brings.

I briefly suspend the meeting to allow us to set up for the next item of business. Thank you very much for joining us.

10:01 Meeting suspended.  

10:10 On resuming—