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What do you do if grandma goes on strike? Or when the crèche calls to say your child is sick? Working parents with young children grit their teeth, promise their employer they will make up the hours, and brace themselves for even less sleep. With childcare costs now surpassing mortgage payments for some families — especially those with two kids under the age of five — it’s no surprise the government has seen a political opportunity in the mess.
The Conservative party is making childcare the fastest-growing branch of the welfare state. Over the next couple of years, it will offer extended packages of free hours for two, three and four-year-olds to families where both parents are in paid work, and neither parent earns more than £100,000 a year.
These new entitlements will see Treasury spending on this issue double over the next three years, having quadrupled over the past 25. The Institute for Fiscal Studies says that by 2027, around four in five pre-school childcare hours in England will be government-funded. This is a welcome shift from the party’s traditional focus on pensioners but this particular policy may not be the wisest use of government money.
The issue is already fraught. Hard-pressed taxpayers, including parents who earn just above the Treasury limit, complain that this is a stealth tax. Mothers who have chosen to stay home wonder why their time is valued at zero. Providers complain the government funding rate is too low for them to create enough extra capacity.
The Labour party fudges, reluctant to commit itself to the gargantuan sums involved, but not wanting to fall into the Tory trap of refusing to back overstretched families.
The Treasury aims to liberate parents to work more hours, so that the tight labour market eases and tax revenues increase. But this was not the reason free childcare entitlements were first introduced in the 1990s. Back then, it was all about childhood development. With some five-year-olds arriving at primary school with limited vocabulary and few social skills, there was cross-party agreement that a high standard early years education could reduce inequalities that might otherwise persist for life.
Confusion between these two objectives perhaps explains why the past decades of policy haven’t achieved much on either. There is little evidence that the early years childcare entitlements have had much impact on childhood development by age five, with one detailed study even finding that too much time spent in formal settings can negatively affect behaviour.
Nor do previous entitlements seem to have had much impact on working patterns. This may be because the 15 free hours provided weren’t enough to tip the financial scales. But it might also be because many parents have mixed feelings about leaving their toddlers in nurseries.
Employment of mothers does increase when their youngest child starts primary school but that doesn’t necessarily mean they will want to leave a two-year-old for 30 hours a week, as will become possible from September next year. The IFS estimates that as few as one in six children whose parents claim the new entitlements will see that parent move into paid work as a consequence: not a great return on investment for the Treasury.
By targeting families where both parents are in paid work, the new entitlements also tend to favour the middle-class, rather than the most disadvantaged. There’s nothing wrong with that, except that it’s disadvantaged children who could benefit most in the long term from early years help.
An Oxford university study suggests that formal childcare significantly helps children from the most disadvantaged families if they start no later than age two and attend continuously for at least 20 hours a week.
As the number of unskilled jobs shrinks, the whole of society has a stake in maximising the potential of the next generation. Early childhood lays the foundations of cognitive, social and emotional functioning. It makes sense to invest in those years, and reduce the vastly unequal levels at which children currently enter school.
The problem is that the affordable, flexible crèches that working parents need are different from an ideal model of pre-school education. The fastest way to help more parents take jobs is to offer all-year-round day care, sometimes for long hours.
But the best way to maximise children’s learning and social skills is to pay staff a professional wage and operate for limited hours. For a toddler, a full day is exhausting.
Quality childcare doesn’t mean staff must have a degree. Most pre-school education is about play, not formal learning. But it does mean investing in high quality training, career progression and pay at a level that can end the high staff turnover that currently subjects children to a revolving cast of characters.
Parenthood is hard but immensely rewarding. It is, after all, the only job we are each uniquely qualified to do. Society should applaud those who devote themselves to it; and the state should pitch in. But helping parents and the taxman in the short term does little to help children in the long term. We would all benefit if the government got serious about maximising potential from the start.
camilla.cavendish@ft.com