Onward has published First Steps: Fixing childcare which analysed the UK childcare system

Currently, the UK is struggling through a cost of living crises with prices and wages not meeting inflation levels. This had played a direct role in harming the UK’s childcare system even further and made access to services even more difficult.

The report found that the childcare system in the UK is ‘unfit for purpose’, expensive and inflexible.

“Childcare is too expensive, inflexible and complex. This is contributing to our national challenges with economic inactivity, as parents can’t afford to go back into work. It is also placing strain on families during the cost of living crisis, with 92% of parents saying that childcare costs impact their standard of living.”

Polling of 1,037 parents with children under 5 and found that:

• Half of parents (50%) say that childcare costs have risen in the last year, but just 9% of parents have been able to cut back on childcare
• Nearly a third of families say that childcare is one of their most expensive costs (32%), behind only housing costs (74%), energy bills (75%) and food and drink (66%)
• Fewer than half of parents agreed that “the amount of support I receive each month makes the costs of childcare manageable” (47%)
• 30% of parents say that the costs of childcare have forced them or their partner to consider leaving work to care for their children
• 65% of parents not in work agreed with the statement: “The main reason I do not work is because the demands of childcare are too great” versus 16% who disagreed
• The only reform with net negative support among parents is relaxing staff to child ratios: 52% oppose the idea that “childcare professionals should be able to look after more children at the same time, as they do in other countries” with only 27% supporting.

Purnima Tanuku OBE, chief exec of National Day Nurseries Association (NDNA), said: “Policy around early education and childcare is in desperate need of reform and investment. It is clear that government underfunding of childcare places is the root cause of the current crisis in early years that impacts children, families and our economy.

“This report clearly sets out the impact on parents with a third of working mums considering leaving work due to childcare issues. It also shows that simply tinkering with ratios as a cost-cutting plan is the least popular option for parents.

“In the UK our government invests less per child than Estonia, Lithuania and Slovenia. We know how much the first five years count for our children so this is the stage where we should be investing in their futures.

“We have supported the idea of streamlining all forms of childcare support into one childcare account since 2017. As well as simplifying the system for parents and providers, it would remove the layer of administration which has resulted in millions of pounds in early years funding left unspent by local authorities.

“Exempting private nurseries from paying business rates, that add an average of £13,250 to their running costs, would mean childcare settings could invest  in staffing, training and limiting cost increases to parents.”

Commenting, Neil Leitch, chief exec of the Early Years Alliance, said:  

“While Onward is right to argue that that the current early years system is both underfunded and overly-complex, we are far from convinced that their proposed ‘Childcare Credits’ policy is the solution to the challenges facing both providers and families.  

“We strongly believe that all children, regardless of background, should be able to access a high-quality education and this applies to the early years as much as it does to primary and secondary education. On the face of it, however, the proposed policy put forward by the thinktank would only provide families with a marginal subsidy towards their early years costs meaning that, even with the proposed means-tested ‘Additional Childcare Credit’ those on lower incomes would have much more limited flexibility and choice when it came to accessing care and education for their children.

“While we recognise that such an approach would require less spending from government, early years policy should be developed based on what is best for the child, and not just the government’s balance sheet.  

“Focusing on trying to deliver ‘childcare on the cheap’ is not, and has never been, the answer to the problems our sector is facing. Indeed, it is the very reason we are facing such a crisis.  The fact that Onward’s research showed that relaxing ratios was the only policy explored by the thinktank that had net opposition shows just how much parents value quality, as well as affordability, when it comes to early years provision.  

“The sooner we start looking at early years policy through the lens of what is best for young children, the better for everyone.”