Free universal preschool childcare and more funding for after-school clubs could increase government revenues and save a family with young children between £620 and £6,175 a year, a joint report welcomed by the Labour party has revealed.
The Institute for Public Policy Research (IPPR) and the charity Save the Children have called for a universal childcare guarantee for all families until the end of primary school to allow more women to get back into work and reduce the attainment gap between rich and poor children in their early years.
Parents have been pushed out of work as they cannot afford to pay for rising childcare costs as many schools do not have the funds or staff to hold breakfast or after-school clubs.
The IPPR has previously argued that higher childcare costs as parents increase their hours creates a tax on workers. But ensuring households can access affordable childcare could slash nearly £2.8bn from government social security spending as more families could move into work or increase their hours.
Rebecca, 37, from Norfolk lost a job because she couldn’t afford to work full-time and pay for childcare. She cannot claim universal credit to cover her babysitter costs because of a shortage of Ofsted-registered babysitters in her area. “I do four jobs to fit in around my 10-year-old daughter. It’s really shocking. I tried to work full-time for five months but it got to the summer holidays and I couldn’t come in full-time. The full-time wage was less than the cost of full-time childcare.”
“If breakfast and after-school clubs were properly funded and were reliable, I could get a real job working nine to five every day and earn real money. It would be amazing. Yes, it might be expensive, but it costs them so much money having people out of work and costs them so much having people sick from overworking,” she added.
The report sets out steps for the government to adopt that will eventually boost economic growth, starting with increasing funding for free hours of childcare and extending an offer of 30 hours to all three- and four-year-olds. Other steps include:
Extending 15 free hours to all two-year-olds, with eligibility beginning from the end of paid parental leave.
Increasing funded hours for two-year-olds and under two-year-olds.
Extending wraparound care from 8am to 6pm to more schools and offering a variety of after-school activities through term time.
The Labour party has previously adopted policies from the thinktank. Bridget Phillipson, the shadow education secretary, endorsed the report and said: “This detailed and thorough report is further evidence that the time has come for a new, modern childcare system – which would improve lives for every family.
“Labour will deliver a new system to give children the best start in life and parents choices, enabling them to get back into work or to increase their hours and give our economy the growth we need.”
Becca Lyon, head of child poverty at Save the Children, said: “Parents we speak to, regardless of their income, are crying out for the childcare system to change.
“If made a reality, a universal childcare guarantee would be life-changing for families – creating an easy-to-use childcare payment system for all, dramatically cutting childcare costs, ensuring the nurseries their children love are properly funded, and providing free breakfast and after-school clubs when children are older.”
A government spokesperson said: “We know many households and childcare providers are facing pressures from recession and high inflation. Improving the cost, choice and availability of high-quality childcare for working parents is important for this government.
“We have spent more than £20bn over the past five years to support families with the cost of childcare and the number of places available in England has remained stable since 2015, with thousands of parents benefiting from this support. We’re investing millions in better training for staff working with preschool children and have set out plans to help providers in England run their businesses more flexibly.”
