All streams of funding for childcare should be put into one online account so parents can pay their choice of provider easily, according to a proposal from the National Day Nurseries Association (NDNA).
The membership organisation, which represents nurseries across the UK, is recommending its Childcare Passport idea as a way of providing affordable, high-quality and flexible childcare for everyone.
NDNA says that current funding is inadequate and that the system is inefficient and very complicated for parents. There are four main funding streams – employer-supported childcare vouchers, Tax-Free Childcare being introduced this year, free early years entitlement and any help via tax credits or universal credit.
NDNA Chief Executive Purnima Tanuku says: “Developing this new, family-centred system, building on the planned Tax-Free Childcare accounts, will sweep away layers of bureaucracy.
“If parents hold the purse strings they can choose and pay for their childcare directly, making things much simpler for them and allowing more money to reach nursery frontlines.”
NDNA believes that, with the right investment to cover the true cost of high-quality childcare, the Childcare Passport could help to offset longstanding underfunding of nursery places by successive governments which has not kept pace with inflation and rising wages.
Tanuku adds: “The Childcare Passport would involve a change of mindset to a family-centred system rather than the traditional approach that requires families to fit in with the Government’s initiatives. It would be a special account that could only be spent on childcare.
“A cross-departmental taskforce with representation from Scotland and Wales including HMRC, DWP and the Department for Education should be established to deliver the passport.”