Content

1. Two approaches to improving access to affordable high-quality childcareKayte Lawton, 27th February 2013Children England Annual Conference

2. Content • The problems with childcare in the UK • Explanations • Market-based solutions • Public service-based solutions • Lessons for the UK

3. The problem with childcare in the UK • Relatively expensive – for parents and the state • Relatively under-qualified and low-paid workforce – impact on quality • Relatively weak profits / surpluses

4. What explains these weaknesses? • Regulation? Ratios, childminders etc. • More centralised but not uniformly more burdensome • Typically focused on a narrow set of issues • Slightly more restrictive ratios in some cases • Reliance on cash benefits rather than services • Public funding not spread evenly across families • Complexity of funding arrangements

5. Cash vs services in family spending

6. Market-based solutions • ‘Demand-side’ funding – tax relief, vouchers, tax credits • Deregulation – less restrictive ratios, less regulation of childminders • Most OECD countries opt mostly to directly fund providers • Except the US, Canada, the Netherlands and Australia

7. Government’s proposals • Workforce status and quality • More places in high-quality settings • Childminding agencies • Changes to regulatory framework • Plus - tax relief or vouchers, more support through Universal Credit?

8. Market solutions in the Netherlands • Large growth in places, esp. childminders • Low costs to parents – employers pay one third of fees • Massive deadweight costs • Bureaucratic funding system • Quality appears to have fallen in some settings • Provision falled in less densely population and more disadvantaged areas

9. Key questions for the UK Would market-based solutions and deregulation: • Reduce costs to parents? • Improve quality? • Improve choice and the number of places? • Affect parents’ confidence in the system?

10. An alternative model: Denmark The offer to parents • National entitlement to full-time childcare from 6 months to six • Municipalities ensure availability of places • Cost to parents is capped at 25% of unit cost • Very high take-up

11. Governance and quality • National objectives rather than strictregulation • Local governance and accountability • Provider autonomy • Strong parental involvement • Highly skilled workforce

12. Wider welfare state and labour market • Generous parental leave • Universal child benefit, but frontloaded • High replacement rates for out-of-work benefits • Strong conditionality • No equivalent of tax credits • Widespread collective bargaining • High levels of public sector employment

13. Lessons for the UK Affordability: national, comprehensive entitlement / single system of supply-side funding / capped parental fees Quality: high-quality workforce over statutory regulation / decentralised organisation and governance / parental involvement Broader package: services not benefits / parental leave / flexible working / political consensus / broad alliances

14. What next? • We know roughly where we want to get to – how do we start making progress? • How to achieve the right balance of quality, affordability, gender equality – with limited public money • What governance reforms are needed? • Where do we have to make trade-offs, both within childcare and in other spending areas?