In a report, Universal childcare provision in the UK - Towards a cost-benefit analysis, economists at PriceWaterhouseCoopers, the world's largest professional services organisation, said such universal provision would require the creation of about 1.5 million new full-time places in day nurseries or with childminders or other care providers. The report said the immediate economic benefit would be to create around 700,000 new jobs for women, with around half of these jobs in the childcare sector, and extend provision to the levels in Sweden and Denmark.
The economists estimated that the initial net cost to the Government of establishing universal childcare provision would be just under 3bn a year at current prices, after taking account of the increased tax revenues and reductions in social security benefits as more mothers of young children went to work. 'These additional jobs would generate additional tax revenues for the Government, offsetting around 60 per cent of the cost to the Exchequer of the additional childcare provision,' the report said.
The report also noted that moving closer to universal provision in the long term would involve focusing Government policy on children aged one and over, in contrast to its current position focusing on three- and four-year-olds. It would mean extending nursery provision beyond the current two-and-a-half hours a day five days a week for three- and four-year-olds to around eight hours a day of full-time care.
Early years organisations welcomed the report. Daycare Trust director Stephen Burke said, 'The report provides a childcare challenge for the Government. The report endorses the recent call by the Work and Pensions Select Committee for much more investment by Government in affordable childcare in every community.'
But Rosemary Murphy, chief executive of the National Day Nurseries Association, said she thought the most telling aspect of the report was who had produced it. 'The fact that PriceWaterhouseCoopers is interested in the childcare market and is looking at childcare from an economic point of view is very significant.'
However, Mrs Murphy described universal provision for nought- to four-year-olds as a 'quantum leap' she did not think the Government would be prepared to make. 'Childcare has never been the be-all and end-all of Government policy, which has been about getting people back to work as a means of eradicating child poverty.'
Report co-author David Armstrong, senior economist at the PwC Belfast office, said there had been 'surprisingly little quantitative research on the economic costs and benefits of universal childcare provision' compared with studies on primary and secondary education. He said, 'It may be that the benefits of investing in childcare and pre-school learning could be greater than investment in education at later ages, given that a significant part of cognitive and non-cognitive skills development occurs before children start school.'
A spokeswoman for the DfES said the Government's vision 'is that every parent should be able to access good-quality, affordable childcare'. She said, 'Financial support for childcare is targeted on the families in greatest need. Levels of provision are much lower in disadvantaged areas than elsewhere, and it is in these areas that market failures are most acute. Evidence also shows that early intervention is particularly beneficial for children from disadvantaged backgrounds.'
The report is available on www.pwglobal.com
