UK Election 2019: What the Parties say on Parental Leave and Childcare

Professor Emma Tominey investigates the election promises currently being made on family policies.

Both Labour and the Liberal Democrat parties have put forward policies to help new parents. They go further than the current Conservative system, but would leave the UK lagging behind many of its international peers when it comes to supporting new parents.

When people have children, they (predominantly mothers) must decide if and when to return to work, and for how many hours. Their decisions are influenced by many factors, including household income, education and social norms. Policy plays a role too. It affects the affordability of taking leave, by setting maternity and paternity leave policies, and influences the availability and quality of childcare.

Developed countries have seen huge rises in standards of living since the 1970s. Around 40% of this increase is down to the increase in women working. So it’s good for the whole economy if women work and produce, or innovate, earn taxes and spend their wages. And research shows that providing high-quality, subsidised childcare leads to better outcomes for children in the long run, such as more education and less dependency on welfare.

If parents want to work in the years before their child starts school, the important policies are paid leave and subsidised childcare.

Existing policies

While the UK is relatively generous in offering pregnant employees the right to 52 weeks of maternity leave, it falls short on the provision of paid leave. The country comes second last out of OECD countries (loosely defined as developed or richer countries) when it comes to paying women on maternity leave. And fathers receive just two weeks of paid leave, below the OECD average of eight weeks.

chart1

This means that households are forced to trade the benefit of income against time spent with young children. It also means the uptake of leave by dads is very low. Only 1% of eligible parents use “shared parental leave” which allows partners to take some of the 52 weeks from the mother.

chart2

The UK has seen large increases in childcare subsidies for children before school starting age. The current system pays for 15 hours of childcare a week for all three- and four-year-olds, with an extra 15 hours for three- and four-year-olds of working parents (subject to a maximum earnings threshold), and 15 free hours for two-year-olds in low-income families.

But a big problem with UK policy is that a number of childcare centres are currently underfunded. Childcare charity Early Years Alliance reports that many providers, predominantly in disadvantaged areas, face closure and 43% have cut back on learning resources.

So when looking at political parties’ pre-school policies, it’s important to understand whether they will close the current funding gap.

How they stack up

The Liberal Democrat party promises:

* 35 hours a week free childcare from nine months to school starting age. The party says: “This will close the gap between the end of paid parental leave and the start of free childcare provision.”
* An increase in funding for childcare providers to £7.22 per hour for two-year-olds and £5.36 per hour for three- and four-year-olds.
* Nothing new in the way of parental leave policies.

Labour promises:

* 30 hours a week free childcare for every child from the age of two for all parents, not just those on low income.
* Paid parental leave for a full year for mothers or partners instead of the current nine months, paid at the statutory rate (currently £148.68 a week or 90% of earnings, whichever is lower).
* All employees able to work flexibly.
* Increasing the minimum wage, which ensures a higher wage for childcare workers.
* A Sure Start children’s centre in every community, an increase of 1,000.

Both parties suggest they will work to close the gap in childcare provision funding, but the details are unclear here.

Despite these promises, no parties suggest the UK follows trends in countries like Norway, Sweden and others that offer parental leave at full pay. Yet there is evidence that families are vulnerable to unexpected events when mothers are on unpaid leave.

Expanding paid leave from the current offer, which equates to about 12 weeks of average full-time pay, to more like 20 weeks would raise the income and career prospects of mothers. But there is very little evidence that it would improve child outcomes.

Kids Playing On Floor With Educational Toys. Toys For Preschool

Get dads involved

Paid paternity leave has not yet been mentioned by any party even though it could help families and reduce the gender pay gap. A big difference in wages for women versus men is due to women not reaching senior positions, which is due in part to the fact that children are predominantly cared for by mothers, both immediately after having children and in the years that follow.

Very few fathers take more than the statutory two weeks of paid leave in the UK. This is because, with mothers on average younger and earning less than fathers, it makes financial sense for the mothers to take more leave. So giving fathers leave at full pay is crucial to encouraging more of them to take time off. Other countries have created other incentives, such as Norway’s successful policy of paid leave that can only be taken by dads.

There is some good news. Big firms in the UK are increasingly announcing generous paid parental leave to be taken by either parent of a new born. In some cases, up to six months on full pay is offered. For men working in these firms, this essentially offers a use it or lose it policy similar to Norway’s and may have an impact. If the political parties won’t offer it, at least companies are starting to realise the benefits of looking after their employees.

 

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