The UK childcare crisis explained

Yesterday, Rishi Sunak said he wants to improve the affordability,?availability and flexibility of childcare. 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 (like us) 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 gov introduced 30 hours of free childcare a week for 3 & 4 year-olds during school term time. But through an FOI the EYA proved the gov purposely underfunded the scheme by almost ￡3 per child per hour. That’s 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 rise for parents. In 2017 costs had risen 7 times faster than inflation. In 2023, OECD data shows we have either the most expensive childcare in the world or the 3rd 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 more for childcare than their housing. 7 in 10 women who had an abortion in the last 5 years said that childcare costs were a factor in their decision to terminate a wanted pregnancy.

What’s particularly galling is how childcare is constantly ignored. Private schools receive an 80% discount on business rates, but the struggling childcare sector pays full price. If you’re self employed then you can claim for a game of golf, but you can’t claim for your childcare costs - go figure. During the recent budget, the chancellor waxed lyrical about the importance of education, but early years education was completely ignored. The Gov keep talking about helping those who are economically inactive back into work - without ever considering that parents may not work due to childcare issues.

The increasing cost of childcare has meant that many people cannot afford to work. 84% of the 1.75 million people who have given up work to care for their family are women.

43,000 women have dropped out of the workforce to look after family in the last year, a 3% increase on the previous year.. and why might that be? Hmmm, let me think - could it be because childcare costs are increasing far faster than wages? Whilst securing a childcare place can feel like digging for gold on Blackpool pier.

According to the centre for progressive policy an estimated 1.7 million women are prevented from taking on more hours of paid work due to childcare issues, resulting in up to ￡28.2 bn economic output lost every year.

According to Lewis Goodall the Norwegian Governors 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 5 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 & poorest kids, it improves wellbeing, advances social skills & improves the life chances for all.

And by good quality we mean early years educators who are paid a decent wage, are given progression & training opportunities; are highly qualified & tight staff to children ratios. Not the system we currently have where you are paid more for stacking shelves in Asda.

This Government has failed when it comes to the early years education of our children. Their decisions (or distinct lack of decisions) has lead to a sector in crisis, pushing mothers out of work & families into poverty whilst fewer and fewer kids can access this type of critical education.?And we are all poorer for it.