EYU reviews a new report calling for increased government spending to bring about a childcare system that combines quality, affordability and appropriateness for all children

Changes to working patterns and family life have affected the way that we raise our children. Research has shown us that children’s life chances are affected by their early experiences. With these two factors in mind, this government has placed a great emphasis on the early years agenda, introducing policies and systems designed to improve the availability of childcare and early education opportunities. Equal Access? Appropriate and Affordable Childcare for Every Child, a new report from the Institute for Public Policy Research, argues that without a substantial increase in spending in the coming years the proposed improvements will not be attainable.

The report describes the current time as ‘critical’ for two reasons. 1. Current funding must be allocated in the best possible way, as it will be difficult and costly to undo any mistakes.

2. Resources designated for funding the 10-year strategy extend only as far as 2007/08, even though some of the major changes are planned to take place after this. The spring 2007 Comprehensive Spending Review will allocate spending for the following three years, and its decisions will be crucial to the success of the strategy.

It is likely that spending will remain below expectation given the many demands on public money. It is therefore important that those resources which are made available to the sector are spent in a way that will provide most benefit, and have the greatest impact.

The report identifies three challenges to the childcare agenda, which together demonstrate that we have ‘a process begun but far from complete’:

  • all families do not have genuine choice
  • interim evaluations of initiatives such as Sure Start show negative as well as positive impacts, which should be used to inform future policy, not deter further investment
  • childcare and early education needs to be kept high on the government agenda as political focus can be transitory.

The benefits of childcare

Chapter 2 sums up the findings of research into the benefits of childcare and early education, both positive and negative aspects, and their impact on the current agenda. Figures are given to show the impact of changing attitudes to childcare.

 This chapter summarises the government’s policies for this sector so far, from the National Childcare Strategy of 1998, Every Child Matters, the 10-year strategy to the current Childcare Bill, and then explores the different funds available to providers, ‘supply-side spending’, and to parents, ‘demand-side spending’.

Chapter 3 explores the two barriers to equal access, which the report identifies as being affordability and accessibility. Access to childcare and early education can be limited by the complexity of the Working Tax Credit system, which hampers take-up, as well as the eligibility factors that inhibit those looking for work.

The report identifies some groups for whom the current strategy is working least well: children who live in workless households or in large families, have lone parents or come from working families with low incomes; and families that face high childcare costs – perhaps because they live in high-cost areas, have children with special educational needs or disabilities, work atypical hours or live in rural communities. For each of these groups there are explicit details, backed by research and with government data to show the facts and figures.

Chapter 4 provides a debate on spending on childcare, looking in more detail at the ‘supply side’ versus ‘demand side’ funding issue. There has been much debate about the merits of greater provision direct to providers or an improvement to the tax credit system to give more money to parents. Internationally, those countries with advanced childcare and early years systems have direct investment in providers as their main source of funding. However, the broad government preference is to give more money to the parents to enable them to have purchasing power.

The report argues for a balance, suggesting that the majority of new spending should be channelled into supply-side spending, to ‘drive up quality, promote sustainability, and support childcare where the costs and barriers for particular groups of children are high’, whilst there should be changes to the tax credit systems, improving demand-side funding.

Chapter 5 offers some conclusions on the theme of equal access for every child. It sees the current challenge in terms of making the childcare and early education agenda ‘an enduring and unquestioned part of the modern welfare state’, in line with education and health. There are five key recommendations:

1. Entitlement should not be dependent on the employment status of the parents, and should be linked to the Child Tax Credit, not the Working Tax Credit. 2. There should be additional direct spending on provision and infrastructure to improve quality and support sustainability to ensure access for those facing higher costs. 3. Parents should have more information about local childcare services, child development issues and financial support. 4. There needs to be a rethink about the link between work and children’s welfare, providing help for parents making the transition back into the workplace.

5. There must be ongoing research, analysis and evaluation to make sure that future reforms and planned spending impact on high quality services for children.

Equal Access? Appropriate and Affordable Childcare for Every Child, a report by Kate Stanley, Kate Bellamy and Graeme Cooke for the Institute for Public Policy Research can be downloaded from www.ippr.org.uk/publicationsandreports