13 June 2016
The following statement has been released by the Education Minister, Deputy Rod Bryans:
"Since the announcement in March of plans to means-test the Nursery Education Fund, I have met with and listened to members of the public and representatives of private sector nursery businesses. I have also received a draft report from the Scrutiny Panel.
"It has always been my ambition to take into account as many opinions as I could and respond accordingly. I am now in a position to explain a revised proposal.
"The proposal to end the subsidy for families with a household income of over £75,000 was part of the plan to refocus available funds into priority areas and to focus on those who most need support. Education is one of the priority areas identified by the Council of Ministers in the States Strategic Plan, and is receiving additional annual investment in specific areas.
"However, we are all seeking savings through sustainable efficiencies, service redesign and cost reductions.
Targeted assistance
"Changing the subsidy as proposed means some higher-earning parents no longer receiving 20 hours a week of nursery education for their child during 38 weeks of term time in a private nursery. The States subsidy, of £3,914 per child for the pre-school year, would be targeted to those who need it most.
"Based on income information from the Statistics Unit and patterns of States and private nursery use, we estimated this would affect about 100 families a year.
"Various parties I spoke to recognised that the principle of means-testing is right, especially when we are targeting our available funds into priority areas. However, many people expressed concern that the income level had been set too low at £75,000.
"When speaking to couples, what concerned me most was that they felt not enough consideration had been given to the cost of a mortgage on top of their earnings. This would particularly affect professionals such as nurses and teachers whose household income might be just above the threshold.
After contemplation we have decided to move the income level back to £85,000 and from that point have a sliding scale of hours available as follows:
- 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
"This would retain the principle of means-testing. It would allow a greater percentage of people to receive the full 20 hours. The sliding scale creates a buffer giving parents an element of free nursery and, ultimately, it reduces the number of families affected. Discounts will also be in place for families with twins.
"In view of the confusion since the initial announcement, it is worth repeating how we reached this decision.
"Firstly, as Members know, our Strategic Plan highlighted investment in priority areas while balancing the books by 2019. All departments are seeking to deliver services to Islanders in the most efficient and effective way possible, and services should always be under review to ensure value for money. In Education we have rising pupil numbers, increasing special educational needs and a new island-wide Pupil Premium, an initiative widely accepted as the most effective way to raise standards for our vulnerable children and those most likely to under-achieve. This work is overdue.
Private sector nurseries
"Secondly, the Nursery Education Fund in its current form is not sustainable. More private nurseries want to join but we cannot meet the rising cost. We have already had to freeze the hourly rate for two years in order for the scheme to continue because the expenditure of £1.9 million already exceeds the NEF budget.
"I believe early years education is vital, and the private sector nurseries have an important role to play, however we must focus our available funds on the areas of most need.
"Parental choice – also vital – must be protected if possible. To achieve this we are adding extra capacity States school nurseries and they will remain free for all children, irrespective of their background. This is in line with the rest of the education system, where parents can apply for a free place or a fee-paying place for their child at primary or secondary school without being means-tested.
"As I have mentioned previously, I regret the confusion caused by the timing of the initial announcement. We decided to announce it well ahead of the formal lodging of the MTFP Addition on 30 June simply to give parents as much notice as possible.
"To clarify, in the revised proposals announced today we are moving ahead with means testing the NEF because we believe this is the right thing to do at this time. We are raising the bar to take account of parents’ concerns about the threshold and we are introducing a sliding scale that will reduce the number of families affected. I hope members recognise that we have responded, reacted and revised and that we now have more clarity for the forthcoming MTFP debate."
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