The Sunday Times, Uncategorized

November 14th, 2004

There is an alternative to the chaos of childcare

‘It’s the kiddies, stupid.” That seems to be the exciting new election strategy of both the Conservatives and the government. Last week the leader of the opposition and the prime minister were both energetically chasing the mummy and daddy vote. They spoke deferentially of “hard-working families” and announced lots of complicated new policies. How the heart sinks.

Certainly there is a lot that could be done, or perhaps undone, to help parents with the many and various difficulties of bringing up children.

However, there was something deeply depressing about Tony Blair in his triumphalist daddyness, surrounded by breakfasting kiddies at an early-morning club last week, explaining how schools are going to be open longer now, for all ages, all year round, for the benefit of “hard-working families”.

There was something equally dismal about Michael Howard on his knees in his suit among even younger kiddies, his hands covered in blue paint, to display the Conservatives’ determination to do more too for “hard-working families”.

It would be cheering if, for once, a politician could come up with a vote-catching policy without feeling the need to go through a patronising little pantomime, a sort of ghastly electoral beauty contest with children as unwitting extras.

However, I suppose we must all try to rise above the posturings of politicians and attempt to work out what they are really saying. That is difficult, because both sides’ proposals are complicated, Labour’s much more so.

My own view is that an enormous amount could be achieved for parents of all kinds — rich or poor, working part-time or full-time, in or out of the home — with some radical simplicity instead. That would never interest Labour.

Its future is nailed to the mast of complexity, bureaucracy and state intrusion, and more state-sector jobs. It should interest the Conservatives, but I don’t think they’re really feeling radical enough.

Labour has done a lot for — or at least about — parents during its time in office. It has established the Sure Start scheme to deal with children from conception to the age of 14, providing nursery-school places for all three and four-year-olds and more than 1m childcare places, new children’s centres and the tax credit scheme to help lower earners pay for childcare.

A few weeks ago the education secretary promised schools open from 8am to 6pm, both primary and secondary, with breakfast clubs and after-school clubs as well — the hugely ambitious and much derided “wraparound educare”. And last week, not to be outdone by Howard’s childcare initiatives, Blair announced the same thing all over again.

As Margaret Hodge, Labour’s minister for children, once wrote — with evident regret — “for too long the early years of a child’s life have been seen as the private concern of the parents”.

The Conservatives for once take the opposite approach. The first thing Howard said last week was that families, not government, should decide how to run their lives and bring up their children.

He is proposing less regulation, less red tape, more flexibility, more use of school buildings by the taxpayers who own them, more support for informal carers such as grandparents, and for childminders, and more cash in hand to pay directly for childcare for parents entitled to working tax credit.

Parents are to be in the driving seat, he said. They will choose how to spend this money on the childcare they want — such as family or friends — not the childcare ministers think best.

For those who think, like me, that family life and family responsibilities ought to be de-nationalised as soon as possible, this sounds like a step in the right direction.

It even looks like a toe in some clear blue water. But it still looks uncertain whether the Conservatives will be prepared to be even braver and take a real plunge.

The problem with childcare is that it is prohibitively expensive. Obviously enough, if one woman has to pay another woman to look after her young children or her teenagers, it will cost a large part of what she earns elsewhere (net of tax). It cannot be otherwise, except in the relatively unusual cases where the mother is earning hugely more than a childminder or nanny can command.

So as things are today, unless the mother can get care that is in effect subsidised in one way or another — whether by granny or friends or the taxpayer — she won’t really be able to afford it. If childcare were not in fact subsidised most women could not afford to work.

I’ve never quite understood how all this adds up in the economy as a whole, but there it is. Most parents either are forced to work, or want to work, or both, and that is the reality.

The political question is not who subsidises. The question is how the subsidy works. At the moment the state taxes us all quite highly — if you include all new Labour’s new taxes we pay close to German rates of total tax. And then the state hands it back in dribs and drabs for this, that and the other scheme to parents who didn’t choose any of it and may not like it.

It is complicated and confusing and extremely expensive and bureaucratic to run. According to Anne Longfield, the chief executive of the charity 4Children, Labour’s new childcare plans are likely to cost £85 billion over the next 10 years, which would mean spending about 1% of the UK’s gross domestic product on childcare and early years education.

The obvious alternative would be to stop parents paying so much tax. Working parents ought to have extremely generous tax exemptions, transferable if necessary. Parents looking after their own children at home ought to get extremely generous tax credits.

This makes perfect economic sense. We all need children to grow up and pay taxes, after all. It would no doubt at first produce a huge drop in income to the exchequer. But it ought rapidly to become clear that the simplicity of this scheme would mean vast savings in administration. It would also, I believe, make parents and children much happier.

No longer would a working mother (part-time or full-time, low-paid or well-paid) have to be tracked by the men from various ministries to check on her entitlements, problems, options and underpayments.

No longer would armies of schools and minders and outreach workers and health and education apparatchiks have to keep propping up complex care systems and schemes, along with armies of staff and all their demands in flexitime and pensions. Families could simply use their own money to pay for their own solutions.

The taxpayer would still be subsidising families, indirectly, but with much greater simplicity, efficiency and choice. The Tories are thinking about it; Howard mentioned something rather like it, very cautiously, in his speech.

Given the current fortunes of the Conservative party, I should have thought this was a time not for caution, but for conviction.