Current childcare system is not working and must change
By Anand Shukla
Former Chief Executive Family and Childcare Trust
Our annual Family and Childcare Trust childcare costs report contains few surprises but delivers the same forceful message the data has been telling us for years: the current childcare system is not working and must change.
While the survey measures changes in childcare costs, its purpose has always been to allow us to see the true cost of childcare for parents. The figures remain striking: a single parent working full-time and earning £24,500 with one child aged three, faces an annual childcare bill of more than £4,000. This is despite being eligible for both the 15 hour free childcare offer AND the childcare element of working tax credits. For many working parents childcare costs more than food, more than transport and even more than a typical mortgage payment.
This means that many families face a stark choice between paying the equivalent of a second mortgage bill in childcare costs or for one parent, usually the mother, to sharply reduce their working hours or give up work altogether.
The other ongoing problem the survey highlights is the large gaps in childcare provision. Half of local authorities say they do not have sufficient childcare for children under two. And almost two thirds do not have enough childcare for primary school children before and after the school day. For disabled children and children in rural areas the gaps are even more acute.
Collectively these issues mean that whatever work and family choices parents with young children hope to make, too many find their decisions shaped by the limitations of the childcare system.
This year we also looked closely at the implementation of the free childcare offer for the 20% most disadvantaged two-year-olds. From September this year this will be extended to 40%. We found that most local authorities are making steady progress, but it also illuminated sharp variations, with take-up rates varying from 74 to 91%. London performed particularly poorly- only delivering this key support to 51% of the eligible 2 year-olds.
Local authorities and government must redouble efforts to reach all families that are entitled to this support and ensure there is a place available for all children who need it. From 2015, the extra funding to local authorities to help them roll out the offer will stop and they will only get money for the places they provide. Many risk locking in low take-up in their area leading to local families missing out.
More generally, if the data tells us relatively little that is new, what can we learn from the survey? The simple lesson is that the proposals on the table for childcare reform are not ambitious enough.
The government’s tax-free childcare scheme – covering 20% of childcare costs up to £1,200 per child per year - is welcome support but pales in comparison to the bills parents face. Extensions of the free offer, would help with affordability, but are not the whole solution.
In the current economic climate, immediate large-scale investment in childcare is unrealistic. This is why the next government must prioritise a long term childcare strategy. The last childcare strategy, published in 2004, achieved a huge amount from meagre beginnings: a large increase in childcare places, the number of qualified staff and a significant increase in financial support for parents. This shows that by setting out a vision and the steps to realise it, government can achieve transformational change.
That brings me to a simple message on childcare for government and for each party: think beyond the next political cycle and think big. We’ll be setting out our own proposals for reform later in the year – watch this space.
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