We have the third most expensive childcare globally in the UK, and we are all losing because of it. High childcare costs is a detriment to the economy, society, and parents.
Now society has returned to normality, and most of us have returned to our offices, so too have our children returned to nurseries. Childcare is imperative for working parents. Having childcare systems in place is a huge benefit to society. Children benefit from the educational and social value it brings to their early development and early-years education. Women benefit as it allows them to return to the labour market, which is valuable economically and emotionally. They can return to their careers, incomes, and themselves. Going back to work returns them slightly to the life they lead before having children. Parents can benefit from the dual income when both partners are in work. As a result, society benefits, the national economic productivity increases, and our labour market flourishes. So why are more children not in full-time childcare? The answer is because of childcare costs.
The reality is that the childcare system within the UK is extortionate. The UK has the world’s third most expensive childcare; even though we know how beneficial childcare is, many people simply cannot afford it. In the UK, full-time childcare accounts on average for almost 24% of earnings in a two-parent household. This breaks down to around £11,237 spent on childcare annually, and the average annual income in the UK is £23,583. Two-thirds of parents now spend more on childcare than mortgages or rent. Even if you are lucky enough to afford full-time childcare, there are shortages of nursery places. What then happens if families cannot afford full-time childcare and do not live near relatives who can help relieve the childcare burden.
The calculations aren’t adding up
Many women are being forced into waiting to return to work until their child qualifies for government subsidised childcare. When a child turns two, depending on the family’s income, they are entitled to 15 hours of free childcare a week. This then increases to 30 hours when the child turns three. However, what are parents meant to do when the paid maternity leave ends at nine months, but the free childcare entitlement does not begin for over a year.
Of course, it is solely women forced to put their careers on hold to be a stay-at-home parent. Many fathers are also affected by the cost of childcare and must stay off work as a result. However, it is still commonplace for women to take maternity leave and, consequently, sacrifice their careers to save money on childcare. In 2018, Save the Children estimated that more than 870,000 stay-at-home mums in England would prefer to return to work if they had access to childcare that was affordable, convenient, and reliable. Additionally, a survey by the charity Pregnant Then Screwed and Mumsnet found that 40% of mothers had had to work fewer hours than they would like because of childcare costs. These costs both isolating children from the socialisation beneficial for them and simultaneously pushing parents out of work.
Saving money now is costing women later
The decisions women make to stay at home rather than pay for childcare will have lasting consequences. Women’s pensions will suffer due to prolonged periods of not working. Currently, the gender pension gap stands at 38%. The government must do more to enable women to return to work without their income suffering the consequences.
When questioned about the childcare crisis, our soon-to-be former Prime Minister Boris Johnson gave a less than satisfactory response. Speaking to Justine Roberts, co-founder of Mumsnet, Johnson said: ‘You know, things like Tumble Tots or Dancearound or Little Kickers or whatever these things are that you can do, that currently, you can’t use childcare funding for, but maybe you should be able to do in the future’. Unfortunately, this insight does little to solve to lack of childcare funding from birth to two years. It just sidesteps parents into being able to use the limited hours on a different kind of childcare.
The Conservative party has also recently suggested a new ratio of one adult to 5 two-year-olds in childcare settings. A one child increase from the current regulations governing childcare settings of one adult not looking after more than 4 two-year-olds. By doing this, they are hoping to cheapen childcare; in actuality, it will put increasing pressure on an already tight sector that is seeing more childcare practitioners leaving the field.
We are hoping our next Prime Minister will prioritise fixing a broken childcare system to allow parents to return to their careers if they wish. In turn, helping to rebuild our economy amidst this post-pandemic society plagued with a cost-of-living crisis.