Siobhan Baillie is MP for Stroud.
My main message to the Chancellor of the Exchequer as the Budget looms is he cannot dodge the issue of childcare. Saying nothing is not an option. This is a daily kitchen table issue for millions of frustrated parents, grandparents, childcare providers and employers. And a growing group of Conservative MPs are saying the same thing
Women are now in the workplace in greater numbers than ever before. Men are increasingly taking time out to share care of their children. This is marvellous in terms of progress, and it is right that women have ever increasing job opportunities alongside men. But it is also indicative of modern circumstances. It usually takes two working adults to have a fighting chance of buying a home and paying the mortgage.
Childcare costs are at second mortgage levels or higher.
I asked the fabulous thinktank Onward to investigate what is going on. Our report First Steps: fixing childcare has been well received by parents, childcare providers and politicians from all wings of Parliament.
The facts are stark. Today, parents pay £1,330 more per year on childcare than they did just five years ago. The average price for a part-time nursery place of 25 hours a week for a child under two is a shocking £140 per week – double what people pay for their weekly shop.
Full-time childcare is simply unaffordable for most families. Mums, in particular, report being unable to work at full tilt. Six in ten parents who are out of work cite childcare as the reason they are not working at all.
Recruitment. Productivity. Growing the economy. Post pandemic recovery. The childcare road leads to all of them. We are also now completely out of step with other countries: 26 per cent of parents’ joint income in the UK goes toward childcare costs, roughly three times higher than the OECD average.
Prices for parents have been driven up by a combination of low public subsidy and an inefficient market. The UK spends less on early years support than other countries, at about 0.5 per cent of GDP compared to 0.7 per cent across the OECD. Sweden spends two times more on 0-2 year-olds than 3-5 year olds, but the UK spends six times more on 3-5 year-olds than 0-2 year-olds. The Princess of Wales is campaigning to highlight that the 1001 days of a child’s life are the most important. She is spot on.
Existing childcare schemes are not working as efficiently as they should, in part because of complexity. The Government operates at least eight schemes across three departments to subsidise childcare. Confusion around eligibility has led to major problems, too: of the 1.3 million families eligible for Tax-Free Childcare, only 316,000 take up the support. Of the families eligible for the childcare element of Universal Credit, only 13 per cent take it up. Chancellor, we need simplification of this mess.
The wider market is struggling too. Since 2015/16, the number of childcare providers has fallen by around a quarter. In the last ten years, the number of childminders has halved. Providers are also facing severe staff shortages and, as older workers drop out of the workforce, it is becoming less qualified overall.
I want to get to the point where we have a simplified system that unifies the current schemes into a single childcare credit system, provides more choice for parents and starts support after maternity leave.
However, with the Government facing a difficult fiscal situation, it is unlikely that the Treasury will be able to invest in greater subsidies in the short term. Any big bang changes should be done carefully in partnership with the childcare sector too. Previous top down, government-knows-best has not been a success.
So, for and around the Spring Budget, the Government must be clear that we are working towards an overhaul of the childcare system. Ministers must ensure the £5 billion that the Exchequer already spends provides greater value for money and we need to stimulate sleeping aspects of the market. Some of the provider side proposals include:
- Childminder numbers being boosted by expanding childminding agencies.
- Increasing funding for the 15-30 hour offer to support workforce growth.
- Unlocking new premises and reforming business rate eligibility for private providers.
- Reviewing all regulations and requirements to assess barriers to participating in the childcare sector.
- Exploring greater recognition of early years’ childcare options, including flexible care like Home Child Carers for wrap-around support.
- Enhancing in-job training opportunities to incentivise graduates to enter the profession.
- Stripping out unnecessary bureaucracy from existing schemes.
My note of caution is that if the Government changes the rules on ratios now, the noise about that will drown every other positive thing we try to do on childcare. Further, I have not seen sufficient evidence that changing to the Scotland model will significantly bring down costs and England’s stricter requirements are also necessitated by a less qualified workforce than other countries.
Onward’s polling showed parents still have no appetite for reduced childcare ratios: 52 per cent oppose, with only 27 per cent supporting. The childcare sector nearly unanimously hates the idea, and has told MPs such a shift would compromise the safety of children.
For Conservatives, reforming childcare presents a major opportunity to spread economic and social opportunity, particularly for those parents on low and middle incomes. It is a chance to demonstrate how we can grow the economy and support families at the same time. It must be a top priority for this Government.
Siobhan Baillie is MP for Stroud.
My main message to the Chancellor of the Exchequer as the Budget looms is he cannot dodge the issue of childcare. Saying nothing is not an option. This is a daily kitchen table issue for millions of frustrated parents, grandparents, childcare providers and employers. And a growing group of Conservative MPs are saying the same thing
Women are now in the workplace in greater numbers than ever before. Men are increasingly taking time out to share care of their children. This is marvellous in terms of progress, and it is right that women have ever increasing job opportunities alongside men. But it is also indicative of modern circumstances. It usually takes two working adults to have a fighting chance of buying a home and paying the mortgage.
Childcare costs are at second mortgage levels or higher.
I asked the fabulous thinktank Onward to investigate what is going on. Our report First Steps: fixing childcare has been well received by parents, childcare providers and politicians from all wings of Parliament.
The facts are stark. Today, parents pay £1,330 more per year on childcare than they did just five years ago. The average price for a part-time nursery place of 25 hours a week for a child under two is a shocking £140 per week – double what people pay for their weekly shop.
Full-time childcare is simply unaffordable for most families. Mums, in particular, report being unable to work at full tilt. Six in ten parents who are out of work cite childcare as the reason they are not working at all.
Recruitment. Productivity. Growing the economy. Post pandemic recovery. The childcare road leads to all of them. We are also now completely out of step with other countries: 26 per cent of parents’ joint income in the UK goes toward childcare costs, roughly three times higher than the OECD average.
Prices for parents have been driven up by a combination of low public subsidy and an inefficient market. The UK spends less on early years support than other countries, at about 0.5 per cent of GDP compared to 0.7 per cent across the OECD. Sweden spends two times more on 0-2 year-olds than 3-5 year olds, but the UK spends six times more on 3-5 year-olds than 0-2 year-olds. The Princess of Wales is campaigning to highlight that the 1001 days of a child’s life are the most important. She is spot on.
Existing childcare schemes are not working as efficiently as they should, in part because of complexity. The Government operates at least eight schemes across three departments to subsidise childcare. Confusion around eligibility has led to major problems, too: of the 1.3 million families eligible for Tax-Free Childcare, only 316,000 take up the support. Of the families eligible for the childcare element of Universal Credit, only 13 per cent take it up. Chancellor, we need simplification of this mess.
The wider market is struggling too. Since 2015/16, the number of childcare providers has fallen by around a quarter. In the last ten years, the number of childminders has halved. Providers are also facing severe staff shortages and, as older workers drop out of the workforce, it is becoming less qualified overall.
I want to get to the point where we have a simplified system that unifies the current schemes into a single childcare credit system, provides more choice for parents and starts support after maternity leave.
However, with the Government facing a difficult fiscal situation, it is unlikely that the Treasury will be able to invest in greater subsidies in the short term. Any big bang changes should be done carefully in partnership with the childcare sector too. Previous top down, government-knows-best has not been a success.
So, for and around the Spring Budget, the Government must be clear that we are working towards an overhaul of the childcare system. Ministers must ensure the £5 billion that the Exchequer already spends provides greater value for money and we need to stimulate sleeping aspects of the market. Some of the provider side proposals include:
My note of caution is that if the Government changes the rules on ratios now, the noise about that will drown every other positive thing we try to do on childcare. Further, I have not seen sufficient evidence that changing to the Scotland model will significantly bring down costs and England’s stricter requirements are also necessitated by a less qualified workforce than other countries.
Onward’s polling showed parents still have no appetite for reduced childcare ratios: 52 per cent oppose, with only 27 per cent supporting. The childcare sector nearly unanimously hates the idea, and has told MPs such a shift would compromise the safety of children.
For Conservatives, reforming childcare presents a major opportunity to spread economic and social opportunity, particularly for those parents on low and middle incomes. It is a chance to demonstrate how we can grow the economy and support families at the same time. It must be a top priority for this Government.