PARENTS are busy people, new parents especially so.
There’s always a nose to wipe, a baby to change or a mountain of laundry to wash and fold. So it is particularly impressive that so many took part in the recent March of the Mummies protests across the UK, including Glasgow.
They marched to demand better rights for working parents and for more affordable childcare. And they have good reason. The UK has the second most expensive childcare costs in the world. In fact, nursery fees cost around two-thirds of families the same amount as their mortgage or rent, that’s according to the Organisation for Economic Co-operation and Development.
If you’re childfree or if it’s been a while since you had a young child then let me stagger you with some alarming numbers. A full-time nursery place for a child under two costs a little over £14,000 a year or £269.86 a week – that’s according to the website DayNurseries.co.uk. Let me remind you that the latest data from the Office for National Statistics shows the average weekly pay was £578 in September. If you put your child in nursery full time, almost half your total pay will go on childcare. Almost half of everything you earn.
I recently spoke to a friend who is a qualified early years educator, working in a nursery. She receives 50% off her own childcare fees as a perk of the job and yet she is still worried about going back to work because her own pay barely stretches to the half-price cost. If workers like her are priced out of childcare then our shortage of nursery places will get worse and the entire economy suffers.
But whenever parents bring up the painful cost of childcare, someone always makes the same tiresome argument: “Don’t have them if you don’t want to pay for them.” This is unbelievably frustrating and short-sighted, for a number of reasons.
Perhaps the most simple point is that in a society, there are all sorts of things we need that we don’t necessarily have the money to pay for as individuals. Healthcare. Old age care. Working age benefits. Policing, firefighting services, the list goes on and on.
Then, if we want to ensure that women can compete fairly in the workplace, we need to ensure that parents can afford childcare. The evidence shows that when they can’t, in heterosexual relationships it is overwhelmingly mothers who stop working. This increases the gap between men and women’s wages, it traps some women in dangerous relationships because they are financially dependent and it is a key reason why women’s pension savings are typically lower than men’s. In the longer term, if mothers are priced out of work and can’t save into pensions then the state will eventually pick up the bill in the form of increased financial support in their old age.
Setting aside the issue of what is fair, equal and benefits society in the longer term, what about the more immediate situation? After all, we are currently in a recession (it’s not official yet the fact is accepted by the Office for Budget Responsibility, the Bank of England and Westminster’s Jeremy Hunt) and one of the many issues besetting businesses and driving down growth is a lack of labour.
In fact, so serious is this issue that the chancellor has ordered a review of the problem, using part of the Autumn Statement to question why the number of working age people who are ‘economically inactive’ is 600,000 higher than it was before the pandemic. Now, there are many, many reasons for that. We’ve seen a significant number of the over-50s appear to use the pandemic and the lockdowns to decide they want something different and to retire earlier than expected. We have seen considerable numbers of people suffering from long Covid and finding themselves suddenly, unexpectedly living with life-changing fatigue and ill health.
We have also seen a significant number of overseas workers returning home, and you can argue all day about whether that has been caused by Brexit or by the pandemic – I won’t be trying to address that in this particular column. But I will point out that there are parents, mostly mothers, priced out of the workforce by the high cost of childcare. If it could be made possible for these parents to get back to work then that would be an injection of homegrown labour that would decrease the benefits bill, increase the financial security of those parents and provide the workforce that will help businesses across the country improve their productivity.
That could reduce the length and the severity of the recession and help struggling parents afford to work, afford to eat and afford heat their homes in a very tight economic situation.
Ultimately, “You shouldn’t have had them if you don’t want to pay for them,” is like arguing that you shouldn’t have cars if you don’t want to pay for your own roads. Childcare is infrastructure: it gets the workforce working and has societal benefits that go far, far beyond the individual. If you price parents out of being able to earn a living, you don’t just deny them and their family a good quality of life, you deny all of us the chance to live in a functioning economy where you can get an appointment, catch a bus or see a health professional. Childcare is like roads; it gets us to work.
The trick that could save you thousands
I believe firmly that childcare is an essential for parents, for children and for society at large and I know that the cost is a problem for many parents.
But hundreds of thousands of parents are actually missing out on what help is available, because they haven’t signed up for Tax-Free Childcare. This is the system that replaced Childcare Vouchers and it can mean you save up to £2,000 a year per child. It’s simple to use, you open an account and then for every £8 you add, the government tops it up with £2.
You can then use that cash to pay for childcare like nurseries, child minders, holiday clubs and wraparound care. The latest numbers from HMRC show that in September, 401,300 families used this help. However, 1.3 MILLION families are eligible. It may not be enough to make childcare affordable for every family but it would go a long way towards helping.
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