Are families getting the kind of childcare they need?

There is a clear demand for care before age three and school-age wraparound services, with many parents wanting it to be as flexible as possible

The Programme for Government announced this week by First Minister Humza Yousaf promises big changes to childcare. But how should parents, staff and the childcare sector react?

Much of it is a good start. There is a promise to raise the pay of private and voluntary childcare staff, up to £12 an hour. This tackles an existential challenge for the private sector. Since the expansion of childcare from 2016, they have seen hot competition for staff from the public sector.

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Private nurseries in particular matter because they tend to open all year round, when council nurseries are term-time only. They should now be more secure – as long as the detail matches the promise.

Then there’s the idea of a “digital tool” for parents to navigate childcare choices. We don’t really know what this means. It sounds nice. It could be rubbish.

But it’s intriguing, too, because it’s part of a package. It comes alongside a pilot to look at offering childcare from nine months up to the end of primary school. Elsewhere, there is cash for 1000 more childminders. This is good news. It’s also an admission of failure.

Childcare funding in Scotland is heavily skewed towards three and four year olds, who get 1140 hours of free childcare. Expanded provision for those hours was mostly through nurseries.

We shouldn’t downplay how significant that support is. It’s worth about £5000 per child. Nurseries are, on the whole, high-quality in Scotland.

But this approach has obvious blind spots. For many families, there is a clear need for care before age three. For others, the glaring absence is school-age wraparound childcare.

Many want the most flexible, personalised forms of care. But these types of childcare have rapidly contracted: since 2014, the number of childminders by 35 per cent, playgroups by 55 per cent and creches by 61 per cent.

Economists talk about the “opportunity cost” of policy for a reason. You have to think about what else you could have achieved for the same cash. In Scotland, we chose to expand care for all three and four year olds instead of more targeted support blended across different ages. We chose to boost nursery places instead of a more diverse sector.

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These pilots feel like the start of a rethink. That’s welcome. But the course correction should go much further.

Take the really basic design of the 1140 hours policy. Parents have an entitlement. Parents fill out a form at their childcare provider to claim them. The provider is then reimbursed by the council.

Without ever meaning to, that system muddies accountability. Councils are supposed to vet providers for quality, and have developed a range of mini-inspections, training requirements or procurement processes. Except we already have a set of regulators and inspectors for just that purpose.

Not only are councils a quality overseer. They are a funder of private services. They also run their own.

They are under enormous financial pressure across the board and are tasked with implementing a massive, complex capital programme for childcare.

Private providers have long complained that, under this pressure, councils are naturally likely to prioritise their own services.

The promise of extra cash for private staff is going to ease that burden. But it doesn’t actually change the conflict of interest built into the system. There’s still nothing to stop councils prioritising their own services.

Or even embark on an arms race – responding to the news by redoubling their efforts to recruit and retain staff.

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In fact, by promising to expand free hours to more under twos, it’s likely the Scottish Government has locked itself into an upward price spiral. It’s given a nod to the private sector, but energy, admin and food cost rises aren’t going away. Many private providers make up shortfalls by charging more for under twos. If that wriggle room goes – because those children are now covered by government price-setting – then they are even more dependent on state funding.

So it’s fine to extend free hours to under twos. Just as long as the Scottish Government doesn’t expect this to be the last time it has to cough up.

This is the big idea we need to grasp in childcare policy. It’s a complex system. You can’t just subsidise and forget. This week’s announcement is a partial recognition of this: that policy ended up focusing too much on some ages and some types of provider. But it doesn’t follow that through, and tackle the underlying problem of payments through councils.

So what might work instead?

Over the summer, Reform Scotland did some work looking again at the idea of parents receiving vouchers. This would see them receive a cashable voucher for the same amount, but with total freedom to use it where they want.

This would allow the Scottish Government to achieve many of the things it wanted to today – better support for childminders, more equal treatment for private nurseries, genuine choice for parents. But it would also clarify accountability. It would strip out complexity. It would make for a much more resilient sector. It would do so without spending any more money.

Perhaps the most attractive idea is that it starts to change who calls the shots.

The plan is a government responding to itself – working out how to undo some of the unintended consequences of its own well-intentioned policy.

A better approach might be to put parents in charge in the first place. Childcare, after all, is a game of trade-offs. The many choices and balances between different options and purposes, between flexibility, affordability, and quality.

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Who best to make those choices – councils, ministers, providers – or parents?

Gordon Hector is Head of Policy and Strategy at Urban Foresight, an innovation and

policy practice based in Dundee. He was previously a senior adviser for Ruth Davidson

MSP and Jackson Carlaw MSP in the Scottish Parliament. He has written a report on childcare for the Reform Scotland think tank.



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