Spring Budget 2022: Childcare and gender

High quality, accessible and affordable early childhood education and care is an investment in essential social infrastructure, with the potential to deliver significant levelling up benefits. High-quality childcare in the early years helps to close the attainment gap between low-income children and their more advantaged peers, reducing inequalities and creating benefits that last throughout a child’s time in school and beyond.

Even before the onset of the Covid pandemic, the childcare system in England was failing to meet the needs of children, parents and the economy. Covid disrupted access to childcare and early years education, impacting children in deprived areas more and widening development gaps.

“Covid disruption impacted children in deprived areas more and widened development gaps.”

The commitment in the 2021 Spending Review for a further £500m for early years services does not go far enough to meet the scale of the challenge in the sector. The UK spends less than 0.1% of GDP on childcare, the second lowest investment in the OECD. Before Covid hit, just over half of local authorities in England reported that they had enough childcare for the children of parents who work full-time, and less than a fifth had sufficient childcare for the children of parents who work atypical hours.

The cost and unavailability of childcare puts household budgets under strain and for many women ‘it doesn’t pay to work’. An estimated 1.7 million women are prevented from taking on more hours of paid work due to childcare issues.

“The cost and unavailability of childcare is putting household budgets under strain, and an estimated 1.7 million women are prevented from taking on more hours of paid work due to childcare issues.”

One third of parents using childcare say their childcare payments are bigger than their rent or mortgage. This rises to 47% of those with a Black ethnic background and 42% of those receiving Universal Credit.

In the short term the Women’s Budget Group is calling for: funding for the ‘free hours’ hourly rate that reflects the true cost of care provision, including paying staff the Real Living Wage and providing plenty of places for children with SEND and 2-year-olds that qualify for the free hours; an independent review into the childcare system we want and need, including how it is funded, and a workforce strategy to develop the practitioners needed to deliver it; and, in the medium term, a supply-side funding model, a better rewarded workforce and increased targeted support for the most disadvantaged children, who benefit the most from high-quality childcare.

 In the longer term the Women’s Budget Group is calling for: the government to invest in a universal and free system, delivered as a public infrastructure service on an equal footing with school education. Investment in such a system will largely pay for itself due to the big returns on maternal employment.

Please note that this briefing applies only to England. Policy in other regions may vary.

Read and download the full briefing here