The government should learn from the childcare policies of other countries

In Norway, state support for childcare goes to providers who have to meet quality criteria in order to receive any money.

Today’s trailing of the Budget’s childcare announcement will be good news to hard-pressed parents, struggling to balance family life, work and huge childcare bills.

But it does little to solve other inherent problems in this country’s childcare system and may not be an effective use of public money. In the long-term, radical reform of childcare support is needed and a shift to funding providers and not parents.

Childcare is high on the political agenda and today’s announcements are the latest in a string of commitments from all the main parties. Late last year the Liberal Democrats proposed increasing the number of hours of free early education, with one year olds qualifying for ten hours and extra free hours for two, three and four year olds.

With an eye on the Referendum, the Scottish government has also proposed to extend the hours of free early education. If the Scottish Nationalists win the Referendum they propose to offer 600 hours of free early education every year to the 50 per cent most deprived two year olds and increase the hours of free nursery education for three and four year olds to 30 hours per week, in line with the primary school day.

Labour has promised a guarantee of a place in an after-school club for children of primary school age. It also proposes to increase the hours of free early education for three and four year olds to 25 hours every week, up from 15 hours (570 hours over the year) today. This would only be available to working parents, a criteria which may be hard to implement in a school nursery.

In contrast, the government’s proposals channel funding to parents. Today’s trailing of the Budget announcement indicates that parents will receive a ‘voucher’ to cover £2,000 of their childcare costs, instead of the initial proposal of 2013 to give them £1,200.

Moreover, this money will be available to working parents with children under 12, instead of those with children under five, as initially proposed. It will be introduced next autumn, although parents who receive tax credits will be excluded from this support.

This latter group of parents will receive additional help in 2016, when the childcare support levels within Universal Credit will be increased to cover 85 per cent of costs, up from 70 per cent today.

It appears likely that the government has responded to criticism and made this extra help available to all parents getting Universal Credit, rather than excluding the lowest income parents not paying income tax, as initially planned.

This is very welcome, but the poorest parents – those receiving tax credits – will still have to wait longer for help than those on higher incomes.

Extra investment in childcare is welcome, but today’s announcements do little to address some of the chronic problems with childcare in the UK.

There are big gaps in provision with a recent survey suggesting that only 51 per cent of local authorities had enough childcare for working parents. There are legal obligations on local authorities to ensure sufficient childcare – the Childcare Act 2006 and the Scottish Early Years Framework – but local authorities are not delivering on this and Westminster and the governments are not holding them to account.

Too much early education is of poor quality in the UK and market mechanisms are not acting to lever up quality. This is because cost and location influence parents’ childcare decisions much more than quality. But it is only the best quality early education that improves children’s outcomes and narrows the development gaps between the most disadvantaged children and their peers.

Additionally, the present government has weakened quality improvement regimes for nurseries. In England, local authorities are no longer allowed to impose quality preconditions on nurseries as a criteria for receiving funding to deliver free early education for three and four year olds.

In order to address quality issues, the government needs to look at practices in other countries, using supply-side funding, channelled to providers to improve quality.

In Norway, state support for childcare goes to providers (nurseries and after-school clubs) who have to meet quality criteria in order to receive this money. Parents, in turn, are provided with low cost or free childcare by the provider.

Supply-side funding and proper regulation is a much more efficient way of delivering affordable and high quality childcare.

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