In a relatively short period of time, United Kingdom policy has come a long way in its efforts to tackle child poverty and enhance child development. The United Kingdom has more than doubled spending on childcare since the late 1990s, to 0.4% of GDP in 2003/4. Financial support for childcare is now given to more families – it was extended from 180,000 low and middle-income working families in 2002 to 317,000 in 2004, and the Working Tax Credit covers up to 70% of childcare costs (to be extended to 80%) for low-income families.
Even so, families still find it hard to reconcile work and family life, and further efforts are needed if British parents are to have the same opportunities as those in the best-performing countries such as Sweden and Finland. Access to affordable care remains a problem, with out-of-pocket costs high enough to be a barrier to work. Estimates of average parental fees in the UK range from 45 to 75% of the cost of childcare – 2 to 4 times more than in Finland and Québec in Canada, and 4 to 8 times more than in Sweden. Thus, it often does not pay for both parents to hold down full-time jobs. As a result one parent working full-time and the other part-time is the norm in the UK.
The offer of free early education for 2.5 hours/day for 3 – 4 year olds in nursery schools is aimed at strengthening child development and reducing the parental share of the cost of childcare. The government is promising to extend free early education to 15 hours/week for 38 weeks/year. This will still leave many parents resorting to private day care and taking time off to transport children from one care source to another - an organisational challenge which could force many more out of full-time employment. Babies and Bosses suggests that childcare support needs to be provided in a more coherent way.
The quality, cost, and opening hours of childcare facilities in the UK are also thorny issues for parents. Only 40% of day-care providers are inspected under quality-assurance schemes. In keeping with UK government plans, Babies and Bosses recommends that the government apply quality control systems to more childcare facilities to ensure that day-care workers meet stringent qualifications and give home-based childminders access to support services provided by local Children’s Centres.
New UK policy will provide supervision to older children whose parents work full-time so they don’t become latch-key kids at risk of behaviour problems. Through studying other countries, Babies and Bosses has seen that out-of-school-hours care services can help parents combine their family and working commitments, at about one-third the cost of regular day-care services.
It is in the interest of all families, including sole parents, to have paid work to reduce the risk of poverty and long-term benefit dependency, and to help their children develop. In many countries, sole parents and women have about the same employment rate. In the UK, however, only 54% of sole parents have paid jobs, half of them part-time. To rectify this, the government has mandatory Work-Focused interviews, the New Deal for Lone Parents, and fully integrated benefit and employment support services through Jobcentre Plus to encourage sole parents to enter the work force.
However, unlike most countries, the UK does not have a work test in the income support system for sole parents and job search and childcare assistance through the New Deal for Lone Parents is based on voluntary participation. Babies and Bosses suggests that when effective employment and childcare support are available to sole parents on income support, some form of compulsory work-related activity (including skills upgrading) could be introduced in order to ensure that they look for a job more actively.
Based on its review, the OECD’s Babies and Bosses report suggests the following policy recommendations to improve the balance of work and family like in the United Kingdom:
Ensure that integrated family support, including childcare delivered through children’s centres, is accessible to all low-income families, and further increase public support on childcare, including reviewing, and when required, increasing the generosity of the childcare element of the Working Tax Credit so as to help more working low-income families buy quality childcare.
In line with government commitments, extend free nursery school services (e.g. to three hours per day) to reduce the cost of work to all parents, and ensure with local authorities that nursery schools are better integrated with different sources of care, e.g. day care, playgroups, etc, on a local basis. Extend investment in out-of-school-hours care as planned, also by exploring options to make better use of existing education facilities for the provision of such care.
To reduce the risk of long term benefit dependency and poverty among sole parents and their children, a comprehensive strategy of active and early interventions to foster labour market re-integration is needed. To build such a system takes time, and the UK support strategy of mandatory Work-Focussed Interviews (WFI), the New Deal for Lone Parents (NDLP), and integrated employment and benefit support (Jobcentre Plus) is still being rolled-out. Once employment and childcare support is available on a comprehensive basis, it would be reasonable to oblige sole parents on income support to make use of it. Further down the line, some form of compulsory work-related activity, beyond the Work-Focussed Interview, could be introduced.
Ensure more flexible delivery of childcare support through the Working Tax Credit for parents moving between jobs or when parents have been forced to reduce working hours to below 16 hours per week.
Extend existing initiatives that provide workplaces with tailored advice on family-friendly policy both in duration and the number of participating firms to build long-term enterprise commitment to family-friendly policies through regular re-assessment of a greater number of workplaces.
Give parents greater choice in their return-to-work decision, by allowing greater flexibility in taking leave payments, e.g. allow a parent to return to work after four months, possibly on a part-time basis, without loss of the overall entitlement. In line with announced plans, reform “maternity leave” into “parental leave” and give fathers the opportunity to share in the use of entitlements. This need not require additional spending.
For employees who extend maternity leave to 12 months, increase the notice period to approximately two months.
How to obtain this publication:
Press Release & other country notes - Canada, Finland, Sweden
Babies and Bosses - Selection of Tables and Charts
Babies and Bosses - Reconciling Work and Family Life (Vol. 4): Canada, Finland, Sweden and the United Kingdom