Free childcare ‘would pay for itself’

Childcare costs are a barrier to women returning to work and providing free childcare would pay for itself, according to think tank the IPPR.

Childcare costs are a barrier to women returning to work and providing free childcare would pay for itself, according to think tank the IPPR.

In a report published today it argues that providing universal childcare is crucial to improve the UK’s female employment rate. It shows that universal childcare pays for itself: each mother returning to work part time on an average wage after a year’s maternity leave would net the Treasury £4,860 over four years, in additional tax revenue. This rises to £20,050 if women work full-time.
 
The report shows that the employment rate of women with children in the UK is lower than most OECD countries – ranking 19th behind countries like Iceland, Sweden and Denmark, which have affordable, high-quality childcare provision.
 
IPPR analysis shows that female unemployment in the UK is likely to get worse, as the private sector is failing to fill the gaps left behind by public sector jobs cuts, especially in the north of England. The most recent figures show that the number of women out of work increased by 43,000 to 1.09 million, the highest level since February 1988. The North East and Yorkshire have seen particularly large increases to the number of women out of work. Over the last year female unemployment has increased by 23 per cent in the North East and 19 per cent in Yorkshire.
 
IPPR also argues that the government should extend the new ‘youth contract’ to ensure a ‘jobs guarantee’ for everyone unemployed for more than a year. IPPR says these jobs should be created in local government and the voluntary sector and be paid at the minimum wage. IPPR argues that if people unemployed for more than a year refuse to work they should lose their benefits.
 
Nick Pearce, IPPR Director, said:  "It is far better for our economy to have people in work and paying taxes than at home claiming benefits. Women will return to work if we can re-start growth and give families access to free and high quality childcare. At a time of severe fiscal constraint, it is vital for Britain to focus resources where they will make the most difference – in helping families with the cost of living and strengthening the public finances over the long term.”
 





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