Back to basics: what is childcare policy for?

Towards a childcare system based on choice

Ellen Pasternack and George Cook, April 2024

Childcare is a larger political priority in the UK than it ever has been before, and the target of unprecedented, and growing, levels of public spending. Despite this, there is little clarity on what the purpose of childcare policy is.

Politicians and policymakers often talk as though childcare policy is a labour market intervention, designed to increase the employment rate of mothers, or an educational one, designed to improve educational outcomes for children. However, if this is truly what childcare policy is for, then it is highly inefficient: both of these outcomes could likely be achieved more effectively by other means.

Current childcare policy is also not effective at achieving what we believe it should be aiming for, which is supporting parents with the cost of raising children in the early years. This is a goal that seems to have been lost sight of, but it is an important one. Parents often face very high financial costs in the years between the end of parental leave and when their children start school, because those children have to be provided with full-time adult supervision. Whether parents achieve this by paying for childcare or doing it themselves at the expense of paid work, these costs for some may be prohibitively high.

This report makes several suggestions for reforms that would re-orient childcare policy towards the objective of supporting parents, including cash support, tax reform, and streamlining childcare regulation.