The road to universal “free hours” provision of childcare for all children above 9 months old is an ambitious goal for Westminster, paved with good intentions. All major parties appear committed to the package and it is arguably, a much grander political priority across the parties than it ever has been before, combined with unprecedented levels of public spending.  

But dig deeper, and we find various commitments to multiple and confusing policy objectives, offering little clarity on what the purpose of childcare policy is. Is it a labour market intervention, designed to increase the employment rate of mothers? Is it an educational tool, designed to improve educational outcomes for children? Both these potentially desirable outcomes could be better achieved by other means than the system we currently have in place.

At the bottom of all these concerns, as shown in a new report from the think-tank Civitas, of which I am CEO, childcare policy is becoming least effective at the one thing it should be aiming towards most: supporting parents with the cost of raising children in the early years. In an age of luxury beliefs, we are providing extensive subsidy for childcare programmes which have effectively lost sight of the very high financial costs faced by ordinary parents in the years between the end of parental leave and when their children start school. If parents are to alleviate these costs by paying for childcare or doing it themselves at the expense of paid work, these costs can be prohibitively high. So the point is to give them “choice”.

Westminster often has a natural instinct to build bigger, more expensive and gargantuan in ambition, but without direction, clarity, or laser-eyed focus on delivery. HS2 was a case in point. What we should be arguing for is something a whole lot more flexible and choice-based for parents: something along the lines of cash support for parents which would be more helpful than the system of childcare subsidies we currently have in place, which is expensive and unpopular with parents.

Why not replace the flawed “free hours” model – which seems likely to continue to generate inordinate costs for those it is supposed to serve – with a cash upfront model? We should replace the government’s “free hours” offer with a voucher model of cash-in-hand childcare support.

There are other serious reforms we could complement that move with, such as allowing parents to claim a larger amount of their total Child Benefit entitlement while their children are very young – a policy known as “frontloading”. We could also minimise regulation, making the learning requirements in the Early Years Foundation Stage (EYFS) optional for childminders. EYFS is the standard that school and childcare providers are required to meet for the learning, development and care of children from birth to the age of five. Additionally, on tax breaks, we should be raising tax thresholds for parents of early years children. There are also options for making childcare expenses tax-deductible.

We could certainly do a lot better through reforms by recognising and rewarding grandparent carers. We should have already developed a streamlined childminder-equivalent status for grandparents or other named adults known to parents.

There is a growing wariness as to how we currently approach the cost of raising children in the early years and how this can be made more affordable. Ultimately, some deep and careful rethinking is needed. Our peculiarity in how government looks at childcare is captured by the categorisation of those caring for dependents as “economically inactive” in official statistics. Time to think again. Parents should be left free to choose what is best for them and their family budgets.

Jim McConalogue is the CEO of the think-tank Civitas