The report challenges the perception that childcare market failure in London, such as a shortage of places, prevents parents from working and children from being lifted out of poverty.
The London Development Agency commissioned the University of East London, with Laing & Buisson and Roger Tym & Partners, to investigate barriers to the availability and affordability of childcare in the capital.
Eva Lloyd, reader in Early Childhood at UEL and co-author of the report, said there was 'a mismatch' between the 60 per cent of mothers who work atypical hours - that is before 9am and after 5pm - and the availability of childcare outside these times.
Employers such as Transport for London and the NHS 'work round the clock', she said. 'London is special, with higher levels of unemployment and higher levels of poverty. The picture is complex. If the aim is for equitable and equal access, the Government has a problem.'
She said that, as the report points out, there is an economic argument for Government to intervene in the market if the aim is for all children to have access.
The London childcare market is worth £1 billion and represents 18 per cent of childcare spending in England. The number of childcare places in the capital grew by a third between the end of March 2003 and August 2008. While full daycare grew at the slowest rate, the number of childcare places has not fallen as much as elsewhere.
The supply of childcare and early years provision in London is relatively low, at 13 percentage points below the national average. But the report says that while parents appear to think there is a shortage of places in London, 'vacancy rates in nurseries do not suggest evidence of frustrated demand', and there is little hard evidence of an overall childcare supply shortage.
Childcare fees are 25 to 35 per cent higher in the capital but this is a result of market outcome, not market failure.
Around a quarter of London parents find paying for childcare difficult, particularly lone parents, those on low incomes and those with large families.
Report co-author, (pictured), Professor Helen Penn said, 'This research, carried out by economists and childcare experts, indicated that the childcare market does not work in London, and is probably worse in London than in other places. Fewer mothers use childcare in London because they simply cannot afford childcare at the prices offered, and entrepreneurs are unwilling or unable to lower their prices. Access to childcare in London is not because of lack of availability of places, but because of their cost. This is bad news.'
- To attend a free seminar on 3 March with the authors of The London Childcare Report, e-mail e.lloyd@uel.ac.uk.
