Reimagining early years through a childcare guarantee

Eighty years ago, the Beveridge report imagined the UK welfare state in the image of a different world: aspiring towards a state that protected a full-time minimum wage that would enable a male breadwinner to support a wife and one child. Women were assumed to be economically dependent, and to play the role of full-time carers. Now, the UK’s female employment rate stands at 72 % – with nearly two-thirds of women in full-time work (Irvine et al 2022).

Children born today arrive into a very different world to that imagined by Beveridge. Changes to our labour market and wider lives have reshaped how we care, how we make and shape our families, and how we live together. Most modern families no longer fit Beveridge’s model, but our public services and collective institutions have failed to keep pace. Since 2020, the most common working arrangement for UK families with children has shifted to be two parents working full-time (Irvine et al 2022; ONS 2021).

We live in a society that pushes at the limits of work and care, demanding ever more from parents at work and at home. Where formal childcare is needed, it comes with rising costs. A majority of families now rely on formal care (ONS 2022), yet childcare support is patchy and unreliable. This constant juggle puts huge mental, emotional, and financial strain on parents – the brunt of which is still borne by mothers, in their families and working lives.  

Quality childcare is key to good outcomes – but not everyone is afforded it

In the intervening decades, we have also learned far more about the critical role children’s early years can play in shaping the trajectory of their lives. Despite the growing evidence in support of the social, education and economic benefits of investing in high-quality early years education and care, a thin patchwork of service offers leaves children and their families largely out on their own through this crucial life stage. The impact of this underinvestment plays out across depressingly predictable lines: children growing up on a low income are less likely than their more affluent peers to take up their funded nursery place, or to access the high-quality care that is linked to improved attainment at school (Sutton Trust, 2021). This, in turn, sets the scene for widening educational inequalities, and presents an increasingly acute challenge for our primary school education system to pick up: almost half of children entering primary school this year were deemed not to be school-ready by their own teachers (Kindred Squared, 2023).

Quality is crucial in early years education, and high-quality care is key to providing the best possible start for every child. But quality indicators across our early years sector are headed in the wrong direction (Sutton Trust, 2021). Early years provision in England has been chronically underfunded, and staffed by a workforce that is underpaid and undervalued – research suggests 44 % of early years workers are claiming in-work social security (Bonetti, 2019). This feeds into challenges retaining staff, and a cycle of limited training and progression opportunities which fails to ensure decent work for providers, or quality care for children across the country.

A childcare guarantee

What can be done? Any government serious about transforming outcomes for children and easing the mounting pressure on families will need to recognise and invest in early years education and care as a key public service, on a par with primary education. This will require a step change from our current approach, not small-scale reform. 

UK government should work to deliver a childcare guarantee for every child aged 0-11 – stretching from the end of parental leave to the start of primary school (see Statham et al, 2022). This investment would offer each child the best start in their education, relieve some of the immense pressure on new parents, and pay dividends through increased parental employment (with its subsequent tax returns to the public purse).

It’s clear that improving outcomes will rely on stepping up funding where it currently falls short – but this investment should come with measures to reshape our dysfunctional childcare market, which is currently failing to deliver on quality or access. An underfunded system that relies on cross-subsidising costs and charging parents high ‘top-up’ fees will remain skewed towards more affluent families. A childcare guarantee would need to be realised through high-quality childcare settings in every neighbourhood across the UK, linking parents to providers that suit their lives and needs. Realising different outcomes across childcare markets will rely on shifting incentives across our early years system.

Giving regions the power to shape local childcare markets

To do this, we must reimagine the infrastructure that supports the delivery of early years education and care. Restoring local authority capacity through re-establishing early years teams will be key, but we will need to go further to create a better-connected system that can manage supply and drive-up quality over the long-term. Right now, local authority duties to report on local childcare supply create a valuable base of evidence for our supply problems, but the resource and incentive to tackle these gaps is lacking. England’s current local government settlement, and the varied size and capacity of local authorities across the country, limits consistency across care services: some local authorities have no maintained sector nurseries, for example, despite their proven role in tackling pre-school educational inequalities. Long-term transformation will require new structures that are capable of withstanding political transitions, and are not at the behest of local government funding negotiations.   

To get the best out of early years’ investment, we make the case for establishing Regional Care Co-operatives (RCCs). This idea was originally proposed through Josh McAllister’s independent review of children’s care services, in which he argues that care co-ops could take on responsibility for running new public-sector care, and for commissioning not-for-profit and private-sector services. Local authorities would in turn have direct involvement in running RCCs. McAlister points to regional care co-ops as a means of addressing the chronic shortage in supply of foster places across England – detailing its costly knock-on effects.

We face a parallel challenge in our childcare sector, whereby a lack of sufficient supply of affordable, available, high-quality places in neighbourhoods across the country prevents children and their families from thriving. Regional care co-ops could be tasked with managing the supply of places across their region – collaborating with new, local authority-led nursery trusts to oversee the acquisition of failing providers, to establish or commission new not-for-profit services where supply is falling short.

A key weakness of our current childcare system is a lack of capacity to shape local childcare markets. The recent proliferation of private for-profit provision alongside the contraction of the local authority-maintained sector appears to be contributing to widening inequalities in early education, as profit-seeking providers underserve low-income families who have historically gained the most from the high-quality offer realised in maintained settings (see Simon et al, 2022). RCCs would seek to minimise profiteering across the sector by enforcing new quality standards and conditions on government funding, including by setting limits on acceptable levels of indebtedness for care providers.

Boosting quality and availability through better monitoring and integration

RCCs would be directly funded by the Department for Education and would play a coordinating role, offering strategic capacity to shape childcare supply and ensure consistent quality of education and care. This could involve working with local and combined authorities to integrate childcare infrastructure into local planning and development, monitoring the supply and take-up of places and the mix of providers in local markets, and identifying and plugging gaps by directly creating or commissioning services. They could also play a key role in upholding new care quality standards across the sector through inspection and improvement – bridging the gap that currently exists between local realities and national inspection programmes.

Staff are the key to quality in early years settings, and delivering a childcare guarantee would also require a significant expansion of the early years’ workforce – we estimate to the tune of 130,000 additional early years practitioners. To drive quality up, regional care co-ops could also be tasked with supporting workforce recruitment, development, and retention across local authority boundaries. This would involve creating local skills pipelines that support talented people into early years roles, facilitating training to support providers and their staff, and sharing best practice across providers through early years leadership programmes.

Supporting more equitable forms of childcare provision

Childcare settings are a key site of social connection, providing the backdrop against which children can form their earliest friendships, and new parents can find connection. These places shape the patterns of family life, and the neighbourhoods we live in. Delivering a childcare guarantee would rely on a pluralistic provision model: supporting the growth of not-for-profit multi-site providers, the re-expansion of local authority-maintained settings, and innovation through co-operative models and expanded childminder agencies.

As Beveridge wrote 80 years ago, it is a time ‘for revolutions, not for patching’. By investing in early years education and care, and the supportive infrastructure needed to secure high-quality delivery, we can improve child development, support more parents to get into and get on in work, and unlock economic growth by creating good quality jobs in early years – investing in services that enable families to thrive.

Rachel Statham is Associate Director for work and welfare state at IPPR, the progressive policy think tank. She authored Delivering a Childcare guarantee, with Sam Freedman and Henry Parkes, and Towards a Childcare guarantee, with Henry Parkes and Shreya Nanda.