The Institute for Public Policy Research (IPPR) has called for universal government-funded early childhood care that starts immediately after parental leave to replace an “unfinished patchwork” of childcare provision. The move will improve tax revenues, upgrade the workforce and improve childhood outcomes, the IPPR argues. In a damning report examining current childcare provision, the IPPR said England’s childcare market is on the brink of collapse as government funding for free hours fails to cover rising costs for providers. The report states that:
Children in low-income households receive worse care than those in wealthier households Workers leave workforce due to gap in childcare funding after parental leave ends Upfront childcare costs for parents on Universal Credit, even if paid back later, prevent low-income earners from returning to work Lack of affordable ‘wraparound’ care pushes family budgets to ‘tipping point’
The UK has the second highest childcare costs in the developed world, with fees rising by £2,000 a year and nearly doubling for parents with a child under two since 2010, according to TUC research. The IPPR found that people on low incomes face “extremely high” effective tax rates of up to 130% if they work more than 25 hours a week: as they pay income tax, universal credits and childcare costs rise. This would mean that a manager earning £10.50 an hour with a partner earning a similar amount would effectively pay £3.51 for every hour they worked over 25 hours. “The current childcare system has now created an environment that discourages parents from working,” said Henry Parkes, IPPR senior economist and co-author of the report. “You shouldn’t be worse off than working more. The system needs change.” England’s childcare market has changed dramatically over the past decade, according to the IPPR report. The number of government providers – who “have historically provided the highest quality of care and […] which serve disproportionately disadvantaged children’ – has shrunk while for-profit provision has expanded, particularly in privately owned nursery chains. According to the report “this has contributed to widening access and quality gaps by children’s socio-economic backgrounds”. The IPPR calls for a ‘childcare guarantee’ of 15 hours of free childcare for all pre-school children for 48 weeks a year. Extending 30 free hours for three and four-year-olds to cover school holidays, extending care and a new funding arrangement for providers. The IPPR estimates that making the current 15-hour provision universal to some two-year-olds would cost around £0.9 billion a year, while a 30-hour universal provision would cost £1.8 billion, or £2.1 billion for 48 weeks of coverage . In 2021/2022 the government spent £0.88 billion on street lighting. Rachel Statham, co-author of the report, said that while there was public support for universal childcare, the plight of parents was being ignored by the government. “We see a series of promised tax cuts, but no serious investment in families. This would immediately help people struggling with their bills, but it is also an investment in children, the childcare workforce and the long-term careers of parents.” Archie Bland and Nimo Omer take you to the top stories and what they mean, free every weekday morning Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply.
Fight to save municipal nurseries
A group of west London parents launched a campaign – including a petition and a rally outside Uxbridge Civic Center on Thursday night – after Hillingdon council said it intended to close all three of the village’s pre-schools permanently in December. Parents from the group Save Hillingdon Nurseries claim that private nurseries in the area are between 25 and 100% more expensive than council nurseries and will leave many parents with no choice but to stop working. They also claim that some parents with children who have special educational needs – who were catered for in council nurseries – have been told their child cannot get a place in local private nurseries because of their requirements. Orest Bakhovski, from the group, said the council had made the decision under rules of “special urgency”, which meant it was made quickly without scrutiny or consultation with parents and the local community. “For many people these nurseries are a lifeline and mean both parents can work,” he said. “We don’t think anyone has really tried to keep these nurseries alive and that’s because it’s not a compulsory service. As far as the council is concerned, they can close the services relatively easily and sell the land.” Hillingdon Council said the three centers cost borough council tax payers more than £532,000 a year in subsidy and represent just 1% of capacity in Hillingdon. Ian Edwards, Leader of Hillingdon Council, said: “With inflation rates rising, the council needs to review the way it operates and explore where efficiencies can be found.”
