A family stimulus: Supporting children, families and the economy through the pandemic by the Institute for Public Policy Research (IPPR) think tank in a joint project with the Trades Union Congress (TUC) also claims that the needs of children and families have been forgotten in the crisis response to the Covid-19 pandemic.
The paper notes that the childcare sector has already lost an estimated £228 million (13 per cent of its income) through parents withdrawing their children. Providers also face a ‘cliff edge’ at the end of January, when Government support for free places unused during the pandemic is due to end – meaning an estimated £400 million cut in support.
The two organisations jointly call on the Government to:
- Continue funding the pre-pandemic number of free childcare places until their take-up has returned to normal, at a cost of £400 million.
- Provide at least £88 million transitional funding, for early years education providers, like that provided to schools, to protect jobs and save settings from closure.
- Invest further to create good quality childcare jobs with improved pay and conditions, so creating new opportunities in social infrastructure.
The report notes that other countries recognise the social and economic importance of childcare investment and have injected cash directly – including an additional €1 billion (£911 million) in Germany, and a Canadian Federal Government investment of $625 million (£365 million) to protect access to childcare.
Family support
It also highlights that an ‘urgent cash boost’ to struggling families is vital to improve the lives of millions of children and spare up to 700,000 from living below the poverty line as the pandemic continues.
As well as improving outcomes for children, the ‘family stimulus’ package would help to boost the economy through higher household spending, the report says – adding up to £19 billion to GDP, equivalent to more than half a per cent of national output.
IPPR and the TUC say this should be in addition to improvements to the Government’s new Job Support Scheme, training schemes for workers who lose their jobs, investment in job creation and a wider boost to social security - including ending the benefit cap and the two-child limit on benefit payments.
The paper also examines options for getting more cash into families’ pockets in the face of the expected doubling of unemployment from its pre-Covid levels to 9.1 per cent next year, meaning millions more people likely to be out of work.
Referring to Marcus Rashford’s campaign for free school meals during holidays, IPPR executive director Carys Roberts said that it should not be left to the footballer and restaurants, that are already struggling with the pandemic, to support vulnerable families.
‘That’s why IPPR and the TUC are calling today to put cash in families’ pockets, helping families across the country who are in dire financial straits. Doing so would also give a much-needed boost to the economy, preventing even more jobs being lost,’ she said.
‘Even with the Chancellor’s latest revisions to his job protection measures, his winter economy plan is missing a crucial piece of support. We have one of the least generous social security systems of any developed country. The higher payments we’re calling for with the TUC today will mean fewer families forced to rely on foodbanks to feed their children or otherwise scrambling keep themselves afloat as the pandemic continues.
‘Not only will this family stimulus spare hundreds of thousands of children from the scarring effects of poverty over the next 18 months, but it will also mean an economic stimulus – helping to keep the economy going as we push through the pandemic, and preventing even more jobs being lost.’
Frances O’Grady, General Secretary of the TUC, said that it is also vital to support childcare services.
‘When a childcare provider goes out of business, the knock-on effects a dreadful for working parents, employers and the economy. Without childcare, many parents would have to reduce their hours, or may not be able to work at all. And that will hold back our economic recovery,’ she said.
‘It’s more often mums than dads who do the larger share of childcare. So the impact is likely to be much worse for women workers. It could reverse years of progress on employment equality.
‘We need government to recognise that the long-term cost of a collapse in childcare supply will be much greater than stepping in to protect it now, before it’s too late.’
Responding to the report, Neil Leitch, chief executive of the Early Years Alliance, urged the Government to ensure that greater investment into the early years is a central part of the upcoming Spending Review.
‘The TUC and IPPR are completely right to highlight the patchy and inconsistent support that has been given to early years providers in England to date, and we fully support their call on government to make the significant investment needed to protect the future of the sector throughout the pandemic and beyond,’ he added.
‘With report after report and organisation after organisation calling for greater support for the sector, it's long past time for the government to recognise the scale of the crisis facing early years providers and commit to taking urgent action to safeguard the thousands of settings at risk of closure.’
