Joeli Brearley
Sat, 4 March 2023
The Budget is coming, and parents across the UK are clamouring to find out if Rishi Sunak really meant it when he committed to making childcare more affordable, flexible and accessible. Today, new data from my campaign group Pregnant Then Screwed reveals that for three-quarters of mothers who pay for childcare, it no longer makes financial sense for them to work.
So, let’s talk about our childcare sector – why it’s in crisis, what this means, and why we should all care.
First, to be clear, this is not a new problem. For years, campaigners and providers have been warning that the sector will collapse without proper investment and care. Between March 2015 and March 2022, 20,000 early-years providers in England closed.
Unlike other countries, UK childcare has never been properly funded. In 2017, the government introduced 30 hours of free childcare a week for three- and four-year-olds during school term time. But through a freedom of information request, the Early Years Alliance found that the government purposely underfunded the scheme by almost £3 per child per hour. Shockingly, the minutes from the government meetings also reveal that they were aware this would increase costs for younger children forcing more parents out of the labour market.
Though it may not sound like a lot, £3 per child per hour is a massive financial shortfall, and over the years, that gap has grown wider as care costs more to deliver; but the subsidy isn’t keeping up with those rising costs. Inevitably this means that costs keep rising for parents. In 2017 costs had risen seven times faster than inflation. More recently, OECD data has shown we have either the most expensive childcare in the world or the third most expensive childcare in the world (depending on how you cut the data).
Our research with over 20,000 parents found that two-thirds pay the same or more for childcare as they do for their housing. One in five women who had an abortion in the last five years said that childcare costs were the reason they terminated a wanted pregnancy. And our latest figures show that more than half (54 per cent) of parents who use either formal or informal childcare say they have had to reduce the number of hours they work due to childcare costs or availability.
What’s particularly galling is how childcare is constantly ignored. Private schools receive an 80 per cent discount on business rates, but the struggling childcare sector pays full price. If you’re self-employed, you can claim for a game of golf, but you can’t claim your childcare costs – go figure.
The government keeps talking about helping those who are ‘’economically inactive’’ back into work, without ever making the obvious link that parents may not work due to childcare issues. They talk about the need to “bonk for Britain” as the birth rate slows, but fail to acknowledge that mothers are currently terminating wanted pregnancies because of the cost of childcare.
The increasing cost of childcare has meant that many people cannot afford to work. A shocking 84 per cent of the more than 1.7 million people who have given up work to care for their family are women. Forty-three thousand women have dropped out of the workforce to look after their family in the last year – a 3 per cent increase on the previous year.
Why might that be? Could it be because childcare costs are increasing faster than wages? While securing a childcare place can feel like digging for gold on Blackpool pier?
The Centre for Progressive Policy estimated that 1.7 million women are prevented from taking on more hours of paid work due to childcare issues, resulting in up to £28.2bn economic output lost every year.
According to journalist Lewis Goodall, the Norwegian government recently valued the contribution of working mothers to the country’s GDP, and found it equivalent to the value added by its oil reserves during the same period.
But childcare isn’t just about ensuring parents can financially contribute to their family and to the economy. It’s an investment in children. Report after report shows the first five years of a child’s life are the most critical to their future.
Good quality childcare that can be accessed by all children reduces the attainment gap between the richest and poorest kids, improves wellbeing, advances social skills, and improves life chances for all. And by good quality childcare, we mean the kind provided by early-years educators who are paid a decent wage, are given progression and training opportunities, are highly qualified, and have tight staff-to-children ratios. Not the system we currently have, where you are paid inadequately and treated like a babysitter.
This government has failed when it comes to the early-years education of our children. Their decisions (or lack of them) have led to a sector in crisis, pushing mothers out of work and families into poverty while fewer and fewer child can access a critical facet of their education.
And we are all poorer for it.
Unless we see a significant investment in childcare during the Budget on 15 March, we will lose thousands more providers, costs will increase even further, tens of thousands of parents (predominantly women) will leave the labour market, and child poverty will increase.
The question isn’t whether we can afford to invest in childcare; the question is whether we can afford not to.
Joeli Brearley is the founder of campaign group Pregnant Then Screwed
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