Rachel Reeves’ Budget ‘a recipe for total disaster’ for nurseries, Tories claim

Rachel Reeves’ Budget is “a recipe for total disaster” with up to four in 10 early years providers expected to close as a result, the Conservatives have claimed.

Shadow education minister Neil O’Brien has called on the Government to publish the impact of the increase to employers’ national insurance contributions on nurseries and sixth form colleges.

Education Secretary Bridget Phillipson said funding rates and the Government’s plan for early years providers would be set out “in due course”.

“They say the Budget will be a recipe for total disaster with up to four in 10 early years providers closing unless drastic action is taken.

“So as a first step to averting that disaster, will the minister now agree to publish estimates of how much that increase will cost early years providers? And if she won’t publish it, why not? Doesn’t this House deserve to have this information?”

Ms Phillipson replied: “I take the concerns of early years providers very seriously indeed, and we will set out in due course the funding rates and the approach that we are taking.

“However, what I would say to (Mr O’Brien) is that they are very keen to complain about and criticise measures that we set out in the Budget, yet the leader of the Opposition herself said she would refuse to reverse it.

“They want all of the benefits, the teachers, the breakfast clubs, the rising standards, they are just not prepared to take the tough decisions necessary.”

Mr O’Brien also said that post-16 education providers were worried about how much the increase, announced in the Budget in October, would cost them.

“Now it’s understood the sum of money is available for post-16 education, but colleges have been left completely unclear as to whether this sum of money will be enough to offset the national insurance increase or whether they’ll find, like universities, that it’s entirely eaten up by the national insurance increase.

“So will the minister now agree to publish how much national insurance increase will cost sixth form colleges, and if she won’t publish it, why on earth not?”

Education minister Janet Daby replied: “I find it absolutely shocking that the opposition minister has taken no responsibility for the many situations in which we find ourselves, where this Government has had to make decisions that are in the best interest of students and colleges, and we are doing various reviews to try to make sure we put right the mess that we inherited.”

Elsewhere in education questions, Conservative former minister Sir Oliver Dowden accused the Government of depriving Jewish children of a Jewish education, after a private school in his constituency said it was closing because of the Government’s plan to charge VAT on fees.

The MP for Hertsmere said: “Over the weekend Immanuel Prep in my constituency announced that it was closing, citing VAT on school fees and other damaging Labour policies.

Education minister Stephen Morgan replied: “The Government’s fiscal inheritance is so dire that we have to take tough decisions, but necessary decisions and take them quickly. Removing VAT exemption from January is the right thing to do to deliver for every child across our country.”

Earlier in the session, shadow education secretary Laura Trott called for the Freedom of Speech Act to be implemented – legislation which was brought forward by the Tories but has since been paused by the Labour Government.

Ms Trott said: “Since the Secretary of State decided to pause this legislation, gender-critical women, among others, have racked up enormous legal fees that have caused some to re-mortgage their houses.”

She added: “Inaction has consequences, this delay is causing harm. Will the Secretary of State accept this and get on with implementing the legislation?”

Ms Phillipson replied: “I do accept that academics should be free to express a wide range of views, and they will be views that sometimes people will find challenging, but what also matters is to have workable legislation.

“The legislation that her party set out, I’m afraid, just didn’t do that.”