Welfare: only a radical childcare strategy will meet our needs
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Version 0 of 1. In 1997, according to the charity, Daycare Trust, there was one childcare place for every nine children under the age of eight. The "childcare gap" was a chasm. Good quality childcare matters for children's development; it tackles some of the damage inflicted by deprivation and it allows women to enter the workforce. It is to Labour's credit that the national childcare strategy it launched began to provide what is known as "wraparound care", from breakfast clubs to extended schools including an expansion of voluntary, private and maintained nurseries, childminders and nannies. Improvement has been significant but childcare is still patchy, it is appallingly expensive and employers, in the main, fail to pay a fair contribution. In much of Europe, in contrast, bosses meet up to a third of childcare costs. On Wednesday, the thinktank the Resolution Foundation publishes the final report of its commission on living standards. In a section on childcare, it points out how the combination of benefits, tax credits, tax and childcare costs batters both middle- and low-income families. In Europe, on average, a family pays 13% of its income on childcare. In Britain, the childcare burden can rise to 27%, making it economically unviable for a second wage-earner in the family to work. At the same time, the childcare workforce is disgracefully low paid and many nurseries can barely break even. Only 15% of nurseries are part of chains. The impact of unemployment and the growth of part-time work mean that they run with an average occupancy rate of 74%. At 71%, they lose money. Average profit is a low £13,600 a year. Why childcare is so costly in Britain is a mystery that urgently requires unravelling. Fifteen years after Labour first tackled the issue, there is a pressing need for another childcare revolution. So what should it involve? Beverley Hughes, children's minister under Labour and now in the Lords, has issued an admirable "mea culpa". She says that Labour got it wrong when it focused on putting money into the hands of parents via, for instance, tax credits rather than investing in the supply side and ensuring the stability and sustainability of providers while working to improve the qualifications of the childcare workforce. She advocates a universal free childcare offer for every child aged one to five. The <em>Observer</em> supports her view. However, that will require difficult political decisions to be made about who will foot the bill. Politicians are reluctant to risk the vote of older people by suggesting, for instance, a change to pension tax relief or an asset tax. Both Labour and the coalition have established a childcare commission. In advance of its findings, Labour says it favours the Swedish co-operative model of nurseries. Parents have a share in the profits and costs comes down. The coalition's childcare commission is due to report shortly. It, too, continues to be focused on the supply side of childcare and deregulation. What is required to meet the scale of the need isn't timid incremental steps but a bold and radical strategy. One that ensures quality; reduces childcare costs for families and significantly improves workforce qualifications and wages. Action is needed now. |