Chamber and committees

Thank you very much for that opening statement. I will start with some questions, most of which will be based, as you would expect, on the evidence that we received last week.

One of the issues that I raised is the absence of a single standard funding formula, which will brought in this financial year, apparently. Why has it taken so long to develop that? I ask that question because an issue that was raised is that funding for ELC is in different budget lines. You have talked about transparency but, clearly, that is an issue. That aspect seems to have developed further—that is more the case since the 1,140 hours provision came forward than it was with the 600 hours provision. Will you touch on that first, please?

Is there any idea of what that bureaucracy costs and the impact across Scotland? Is there any measure of that?

One of the issues about ensuring that the funding is transparent and easy to audit is the fact that some of it sits in education and some of it sits in social work, so there is an issue about how the funding is traced. I realise that there is a local financial return in which the direct costs are accounted for; however, that is not always specific or easy to follow, given that different councils have different methodologies. What improvement will be made to that situation?

While we are talking about that issue, is there space in local authority budgets for some key areas to be worked on? It has been said that the current allocation of funding is not flexible enough. For example, last week, we were advised by COSLA that a lot of children require speech and language support but that it feels that the money cannot be used for that and that the ELC grants are not flexible enough to take into account the number of children in specific areas who have such issues.

The Scottish Private Nursery Association made a significant submission when the committee asked for evidence, on which I want to touch briefly. It gave us a series of recommendations. One of them is that the Scottish Government should either

“Directly set the rate which all children will receive for their 1,140 hours”,

or

“Provide funding ... direct to parents through either a voucher scheme or ... an online portal which allows nurseries to be funded directly.”

Could you comment on that?

There have been a number of comments about whether there should be a standard rate, which, as I said at the start of the meeting, would have to take into account things such as rurality, additional needs and so on. I raise that point because we got a table that shows what local authority spending on early learning and childcare would be if all children were funded at the private, voluntary and independent sector rate, and the picture is quite stark.

The SPNA compared how much local authorities would spend in their area if everyone were funded at the same rate as the PVI sector in that area. The result is astonishing. I will give you two examples of the variance. Both East Renfrewshire Council and Comhairle Nan Eilean Siar give £5.31 an hour to the private sector, but if they both gave the same amount of money to the public sector—that is, the local authority—that would cost 45 per cent less in Eilean Siar and 22.5 per cent more in East Renfrewshire. Basically, that shows that East Renfrewshire appears to get more for the private sector per child than for the public sector, but the Western Isles appears to get significantly less. Do those colossal variances—more than 20 per cent higher in one local authority and minus 40 per cent in another—not show that more work has to be done on rates, as you suggested earlier? How do we go about ensuring that we do not have such huge disparities between the sectors?

When you say “streamlining”, what does that mean? Is it a 5 per cent or a 50 per cent reduction in bureaucracy? I am trying to get a feel for the impact not only on the childminders but—given that this is the Finance and Public Administration Committee—on the finance and public administration aspects of the system.

Okay. I hope that evolution will continue in that area in the months and years ahead.

I thank Alison Cumming for attending. That concludes the evidence gathering in our post-legislative scrutiny of the early learning and childcare aspects of the financial memorandum for the Children and Young People (Scotland) Bill. We will consider a draft letter or a report on our findings after the summer recess.

That concludes the public part of today’s meeting. Members will not be able to escape for some considerable time yet, as the next item, which will be discussed in private, is consideration of a proposed contingent liability. However, the public and our witness can leave.

Obviously, you are aware of the evidence that we took from organisations such as the Scottish Childminding Association. Over the past few years, since the policy started to come in, childminding has reduced significantly and there are now 26 per cent fewer childminders in Scotland. Some have obviously decided that they want to work in nurseries, but others have left for other reasons. Last week, the committee was advised that

“the main reason why childminders had been leaving or were planning to leave the workforce in the next five years was the significant increase in bureaucracy and paperwork and the duplicative quality assurance at national and local levels, which has quite simply become unsustainable.”

Graeme McAlister, who gave that evidence, went on to say:

“In my submission, I itemise 10 or 12 different frameworks and standards, each of which comes with different outcomes reporting”

and that, although quality assurance is obviously important,

“it has to be proportionate, joined up and light touch”.

To many people, including me, that duplication seems to be a bit like using a sledgehammer to crack a nut.

Mr McAlister went on to talk about local authorities planning

“twice-yearly inspections and twice-yearly self-evaluations.”—[Official Report, Finance and Public Administration Committee, 21 June 2022; c 28, 30.]

That is obviously putting off a lot of childminders; it also has policy implications. In addition, from a financial perspective, all that bureaucracy being imposed on childminders must cost a huge amount of resource. Are there any plans to have a one-stop shop, so that there is not that overlap and duplication of effort?

The figures show that there has been considerable overfunding, but COSLA has pointed out that, if 98 per cent of the anticipated number of children in an area take up the offer, you cannot, for obvious reasons, reduce staffing. You still need the same staff ratios and so on.

In any case, it looks like there has been, right from the start, an overestimation of the number of children requiring 1,140 hours of ELC. I understand that only 85 per cent of the 98 per cent who have taken up the offer of 1,140 hours have done so exclusively; that might be part of the reason, but surely, with nursery provision, you can look a couple of years ahead and see which children will require it, because they will be turning three. There is the exception of the vulnerable two-year-olds, but you will still have two or three years to plan ahead. However, there still seems to have been a significant overestimation of the number of children requiring the provision. Why is that the case?

Name and shame it!

Sorry, just to interject that no one considers that the Western Isles, with far-flung island communities, can possibly be the same as East Renfrewshire, which is a suburban authority. However, they both pay £5.31 an hour.