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Full Monty to Humpty Dumpty - the New Deal and childcare

Susan Finding
p. 223-239


With the inauguration of the Childcare Strategy in 1998, concomitant with the New Deal, the New Labour government typically tackled both the phenomena or symptoms and the causes of social problems. In the realm of employment, childcare or the lack of it has been both a cause of difficulty in returning to work, and an area in which job creation has occurred. This ‘push-me pull-you’, double-sided approach to social questions endeavoured to combine what the New Labour government would call a ‘social contract’ between society and parents, between employers and future workers, and state semi-intervention, or semi-state intervention in the labour market, creating new jobs by proxy in the private childcare sector with a wave of the social policy wand. This paper examines, firstly those well-known but oft-ignored obstacles to paid employment outside the home namely children, secondly the expanding labour market in the area of childcare and finally the way in which the New Deal was used to bridge the gap between both labour force and labour market in the childcare sector in the first six years from 1997 to 2003, period which was to set the pattern for intervention in this area.

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Obstacles to entering the workforce

1 Policies which promote an active labour market may be construed as intended to ‘activate’ both the labour force and the market. In order to achieve those two aims the labour force must benefit not just from financial support during periods of inactivity when those out of paid work may receive benefits, but it must also receive help towards becoming economically active by means of training, experience and with job seeking. The labour market similarly needs to be encouraged to accept workers through incentives such as guarantees and bonuses which extend or deflect employers’ economic priorities, to diversify its requirements, to be flexible in its demands and to find means to overcome the obstacles to recruitment.

The childcare gap

2 Childcare provision is the first obstacle parents have to overcome to increase their employability. The reliance on informal or semi-formal arrangements previously remained dominant over any formal type. In 1996-1997, 82 % of pre-school age children were looked after by their mother. Only 3 % went to nursery or crèche, private or run by employer, and 1 % were minded by someone at home full-time. (Office of National Statistics, 1998 : Table 3.22) It was thus predominantly women who bore the brunt of the ‘childcare gap’. This was progressively reduced owing to increased parental demand, with parents putting their children into the growing private or voluntary childcare sector. By 1997 it was found that, despite popular misconceptions about the lack of childcare, 91 % of three year olds, and 98 % of four year olds attended some form of nursery provision one or two mornings a week. (Dex, 1999 : 43 quoting Prior, Courtney, Charkin, 1999) Although the number of places appears sufficient, the type of places available left a lot to be desired. With only one registered childcare place for every six children under 8 in 1996, (ONS, 1998 : 39) parents were forced to adapt their working patterns to the availability of childcare. In 1997 66 % of mothers with school age children, and 40 % of those with pre-school children stated they did not ‘need’ other childcare as their employment was adjusted to fit the children’s hours (ibid). However in 2002 one quarter of non-working mothers said lack of provision or the high cost of childcare prevented them from taking regular work, and one in ten mothers working part-time said they would work longer hours if they had suitable childcare (Institute for Fiscal Studies, 2002 ; Ward, 2002) suggesting a shift in attitudes among parents.

The childcare trap

3 The difficulties are greatest for parents of small children (under 5s) and lone parents. Statistics reveal the jump in employment rates once children reach school age. This particularly affects women, who are more likely to be obliged to forego employment to look after their children. Whether due to opportunity or necessity, there has been a steady increase in employment rates of mothers of under-5s since 1985 but these still remain lower than that of mothers of older children. The economic activity of mothers increases as their children grow older.(ONS, 1998 : Table 3.20) Whereas the employment rate of married fathers remains stable at around 90 % whatever the age of their children that of married mothers increases from 58 % for mothers of under 5s to 73 % for mothers of primary school age children and increases as children grow older, reaching 79 % for mothers of older teenagers (16-18). Variants occur for cohabiting parents but the pattern is similar. However for lone parents the problem is exacerbated, particularly for women. Only 28 % of lone mothers of under-5s worked. This figure rose to 47 % for mothers of primary school age children, 60 % for mothers of young teenagers (10-15) and 71 % for mothers of older teenagers. While lone fathers’ employment (53 % for fathers of the youngest children) is higher than the equivalent mother’s employment rate, the employment rate of lone fathers of children at school is surprisingly lower than that of lone mothers. (Holtermann et al, 1999 ; Dex, 1997 : Table 4.1 30) The New Labour government Childcare Review in November 2002 announced a target of a 70 % lone parent labour market participation in 2010, up from 51 % in 2002, noting that this required a ‘substantial increase in childcare places [which] the market alone will not deliver’. (DfES, DWP, HM Treasury, Women and Equality Unit, Strategy Unit, 2002 : 60).

  • 1  £135 a week for one child or £200 for two or more children of two parents, or the lone parent  wor (...)
  • 2  £26.50 a week for first child in families with income under £50.000 p.a. (85% of families) and £54 (...)

4 In order to cope with the high cost of childcare, up to 70 % of childcare expenses1 were paid through the Working Families’ Tax Credit (WFTC) and the Disabled Person’s Tax Credit (DPTC) introduced in 1999. The take-up of this scheme totalled 160,200 people in 2002 with an average £39.22 being paid as extra WFTC for childcare. In April 2003 the Child Tax Credit replaced the above and other provisions including Child Benefit (but not the Family Allowance)2. The average of £40 a week was not sufficient to pay for a childcare place, with a full day session costing an average £11 (Pre-School Facts and Figures 2002 : 10) and parents had to make up the difference. This was notably more difficult for those on low pay than those with comfortable earnings. It was estimated that lone parents spend a quarter of their earnings on childcare. (Ford, Marsh, McKay, 1995 ; Dex, 1999 : 43) In October 2003 free childcare for lone parents was announced following the Interdepartmental Review target for lone parent employment, a recognition of the childcare difficulty such parents faced when seeking employment. However the Government continued to rely on the market to respond to the increased demand for childcare and refused to provide supply-led places.

The childcare labour force

5 The official job description for work as ‘someone to look up to’ in childcare lists the qualities needed and advantages offered : enthusiastic, energetic, resourceful, responsible, patient, liking children, opportunities for return to work, long or short-term positions, flexible job, experience or qualifications not necessary, qualifications & training provided. (DfEE, 2000) It is hardly surprising that this description matches that of parenthood generally as parenthood is childcare and the recruitment drive for the childcare sector reminded parents that they were eminently qualified to apply for jobs, although it was also at pains to point out that not being a parent does not disqualify others. However there are drawbacks to that parent-childcare worker association. ‘For many, childcare is still seen as a low-status, low-paid female-dominated profession’. (Childcare Commission, 2001 : 92) The status, pay and gender-balance obstacles in the sector would appear to be a consequence of the fact that traditionally mothers fulfilled the role of unpaid childcare worker for the family. The ‘childcare trap’ was circular. With lack of formal childcare provision mothers provided informal care, which led to low esteem for formal childcare. There was therefore no motivation, no apparent need for formal childcare.

  • 3  An independent body founded in 2000 by the Kids’ Clubs Network for a one-year period.

6 In 2001 the Childcare Commission3 identified what it considered to be the key issues concerning the Childcare Workforce. These were quality [formal] childcare, low pay and low status in the field, the need for large numbers of new childcare workers in view of the planned expansion of over 300,000 childcare places between 2001-2005, the limited & expensive training available, the need for more men, and more black and ethnic workers to work in childcare and finally, the fact that childminders at home (nannies, caring for over-8s, informal arrangements) were unregulated. (Childcare Commission, 2001 : 91) Each of these questions was addressed as the childcare strategy unfolded and an attempt was made to integrate them into the employment strategies involved.

7 Work in the childcare sector was promoted as an avenue which was above all ‘accessible to many’ and seen as ‘a first step into further training and education and formal employment’. (Childcare Commission, 2001 : 93) An easy route back to work, it offered jobs needing little qualification and informal experience that many had already gained. Emphasis was also placed on the skills parents acquired : time and budget management, negotiation skills and flexibility4. Childcare work also offered formal experience and first qualifications in a job that had career prospects, contrary to many catering or shop floor jobs, helping people get their first foot (back) on the ladder to helping themselves. This was an explicit aim of the New Deal and, at the same time, an ideological standpoint, reemphasizing the self-help ideals present in much of New Labour rhetoric.

  • 5  Islington Council, What Training Courses are Available in Islington,  CIS, February 2002.
  • 6  See for example the PreSchool Learning Alliance, Guide to Training 2002-2003 prospectus; and its P (...)

8 The range of jobs available in the sector demonstrated the ‘accessibility’ of the jobs, many requiring little or no formal qualifications. Nursery assistants and nurses, pre-school leaders, to teaching assistants, and play workers, needed National Vocational Qualifications varying from level 2 to level 3, or even none at all. (Early Years National Training Organisation, n. d.) On the flip side, the status of jobs in the sector was affected by these very same low entry qualifications. The British childcare workforce has a notably lower level of training than other European countries. For reasons of standards and status in the profession and employability of the workforce, great emphasis was placed on the qualifications drive. According to the Childcare Commission there was ‘a need to develop a robust system of childcare training and qualifications that is, nonetheless, accessible to people who don’t possess academic qualifications’ (§6.3.2). A target 50 % of the employees in each childcare unit with qualifications for childcare and play work (NVQs) was set. Public funds were made available for training since many potential candidates could not afford to pay to follow recognised training courses. Facilities concerning enrolment, funding and attendance for childcare training courses were extended by many local authorities. Islington Council provided free sponsored NVQ courses for those with one year’s experience working with children. Local boroughs also agreed to reduced-rate course fees at local colleges for such courses.5 The burgeoning market in training courses and publications in the sector catering for those wishing to gain some formal qualification in childcare was a sign of real career prospects motivating workers and further evidence of indirect employment possibilities in the sector.6

9 Training also posed the problem of childcare for parents with young children who wish to attend full-time courses. Centres such as Riverside Early Years Training Centre in North Tyneside offered both childcare and training in order to help them overcome the hurdle. (Childcare Commission, 2001 : 100) However, despite the growth in training provision, the target training level of 50 % of childcare workers had not been met by 2002, with under 25 % of those who are required by their jobs to obtain the NVQ in Caring for Children and Young People having obtained it. (Woolf, 2002) The qualifications policy is once more a multiple solution to a complex problem. It is firstly an answer to the issue of workforce employability, using pro-active measures to give the labour pool greater opportunities ; secondly, a response to the need for quality formal childcare, freeing labour from family commitments and informal, unpaid and unrecognised work and finally, a means to improve the status and attractiveness of work in the sector. It is also indirectly a further source of employment in the childcare sector.

  • 7  Tax year 1999-2000. In 2001 childcare pay varied from £13.60 to £295 per week, compared to £291.17 (...)

10 Qualifications cannot overcome low status alone. The poor rates of pay are a further barrier to recruitment. The introduction of a minimum wage did nothing to improve the pay situation in the childcare sector. Childcare work was among the ten lowest paid jobs for women.7 (Childcare Commission, 2001 : 6.2.2-3) Pay naturally determines ease or difficulty of recruitment and retention of staff. In 2002 the average pay for pre-school leaders was £6.50 per hour for full-day care (Pre-School Facts and Figures 2002 : 11) while that of a childminder the previous year was £103 for a 34-hour week, or £3 per hour, with no holiday and variable incomes according to parents’ needs. (Duckworth, 2001) This could be compared with an assured, regular £4 an hour available stacking shelves in supermarkets. Help with raising pay levels by breaking the link between pay in the childcare sector and what parents were charged was attempted. It was recognised that lower income families should not have to pay for increased wages in the sector and the government tried to bridge the gap between what those parents could afford and the real cost of childcare places using the mechanisms of the Childcare Tax Credit and Working Families Tax Credit subsequently to become the Child Tax Credit and the Working Tax Credit. (Trouvé-Finding, 2006) The issue of pay in the childcare sector was compounded by fact that these employees are not strictly speaking ‘public sector’ workers, many are self-employed or employees in small private concerns and there are no national pay scales. The recourse to the use of private nursery schools to provide public sector facilities in a universal childcare service is at the root of this particular conundrum. (Trouvé, 2004)

11 Low qualifications and low pay are reinforced by gender stereotypes, the lower the age of the children, the smaller the proportion of men in the childcare sector. In 2002 men made up 17 % of primary teachers, dropping to 3 % of nursery teachers, but only 1.5 % of playgroup leaders and 0.9 % of nursery nurses. Women moved into more traditionally male professions while men did not move into those dominated by women. The reasons are linked to the low profile of the jobs, low pay, lack of confidence and skills in handling small children and a negative social perception of the job and its status. There was no kudos in nappy-changing according to the Childcare Commission Report. (§6.4.1) Accusations of being a ‘pansy’, doing ‘women’s work’ or being a paedophile abound and were adduced by the Childcare Commission to explain male reluctance to enter the sector.

12 In an attempt to try and reverse perceptions of men in childcare, the June 2003 National Childcare Week leading up to Fathers’ Day focused attention on men’s participation in childcare. The slogan ‘He who cares wins’ linked the men and motto of the SAS, ‘Who dares wins’, with the idea of childcare, a similarly multi-facetted and hazardous profession involving rapid intervention in difficult conditions. Further strategies to raise public awareness and acceptance of male child carers were promoted. Profiles of male childcare workers were highlighted. Men faced with redundancy were becoming self-employed childminders. (Gibson, 2003 ; Hinsliff, 2003) At the Sheffield Children’s Centre former steelworkers were employed and, uniquely in Britain, men made up half the workforce. What is striking was the apparent change in employment strategies and social attitudes. Women were looking to more varied job possibilities, turning away from the area they traditionally were corralled into, whereas men, facing the loss of traditional employment in manufacturing were turning towards this field despite long-standing social convention. As Peter Moss, Professor of Early Childhood Provision at University of London and author of the earliest authoritative studies on childcare provision in the 1970s, put it ‘Women’s position in society has been revolutionised so if they will no longer do the caring for peanuts, who will ?’ (Roberts, 2003)

13 Men are not the only population group to be targeted. Significantly, male and/or ethnic origin child-workers are portrayed heavily in recruitment campaign literature (Sure Start, 2003 : 11) in an attempt to redress the imbalance in ethnic representation in the childcare workforce pinpointed by the Childcare Commission Report. It was regretted that whereas 10 % of the population aged 0-14 were from the ethnic minorities only 3 % of childcare workers were from ethnic groups, with 3.9 %, black and minority ethnic managers and supervisors, 5.7 % childcare staff, and 1.6 % black childminders. (§6.5)

14 Many obstacles to returning work thus revolved round the question of childcare. These could be divided into two categories. The first, those affecting parents concerned the phenomena that can be termed the ‘childcare gap’ and the ‘childcare trap’. The second, those affecting the future childcare workforce concerned employability (accessibility, training, family composition, age, gender and race) and recruitment (pay, status). The labour market had to respond to all of these issues.

The expanding labour market in childcare

DfES Strategic Target 10 : To boost recruitment at national and local level so as to expand significantly the workforce for Early years, childcare and play workers to meet the demand of expanding services.

There has never been a better time to work in early years, childcare and playwork. The National Childcare Strategy aims to provide good quality, affordable and accessible childcare for up to 1.6 million children by 2004. Thousands of people will be needed nationally to help achieve this aim. (DfEE, 2000)

15 50, 000 jobs were created in formal childcare over three years, between 1998 and 2001, essentially in nurseries. (Table 1) Given the burgeoning demand for people to enter or return to work in the childcare sector, the available labour pool had to be taken into account. As a result of high levels of male unemployment in some areas and large numbers of women seeking to enter some form of employment compatible with family responsibilities, the childcare sector was seen as a new field of opportunity which would allow both men and women currently without work to find a possible solution to the problems which compounded their difficulties : lack of job opportunities in a particular area (for example old industrial basins with an imploded manufacturing employment sector), lack of qualifications for jobs demanding technological skills such as information technology, lack of flexibility in traditional forms of employment notably in hours worked daily, weekly, or annually. But though offering new opportunities the new economy of childcare was also only fuelling the low-qualified, unsociable hours and low paid sector.

Table 1: Expansion of the childcare workforce 1998 – 2001



 Compound Annual Growth Rate 1998-2001 




+29.8 %




+ 1.3 %

Out of school



+29.1 %




-  81.0 %




+ 6.6 %

Source: Childcare Workforce Surveys2001: Overview, DfES, 2002: 12 in DfES, DWP, et al., 2002: 21.

  • 8 House of Commons, Hansard, Written Answers for 8 February 2001: Column 693W.

16 Although the New Labour spokeswoman Margaret Hodge credited its Childcare Strategy with ‘producing opportunities for work as well as opportunities for children’ and having created 122 000 new jobs in the sector since 1997, making it the second fastest-growing occupational group in the labour market,8 the expansion of the childcare workforce was uneven. The overall average growth rate of 8 % hid marked differences in types and indeed a sharp regression in the oldest form of childcare outside the family, childminding. Recruitment may have increased, but it was not necessarily a smooth process. While jobs available in nurseries and out of school groups doubled (rising from 56,000 to 123,000) from 1998 to 2001, individual childminders lost out to institutional childcare. (Table 1) Whether the childminders themselves moved into jobs as employees of nurseries, playgroups or out of school clubs is a moot question. As the most adaptable, flexible form of both childcare and employment, concern at this overall loss in the number of registered childminders was expressed.

17 Recruitment to other forms of formal childcare was not necessarily easy either. Nurseries and out of school clubs reported difficulties finding staff in 2000/2001. This was hardly surprising given the expansion rate in this sector. In spring 2001 there were unfilled vacancies in 23 % of nurseries and 16 % of out of school clubs, particularly in the North West, Midlands, London and the South East. Childcare employment suffered from comparison with both more qualified, better paid and better status work (nurse or teacher) and less qualified but better or equally well-paid work which was more attractive in terms of kudos (bartender, shop assistant). The Childcare Commission Report identified competition from other sectors such as nursing and teaching as preventing workers being drawn into the field. ‘Childcare needs to be seen as attractive if it is not going to lose out in such a tight and competitive labour market’. (§6.1.2) The retail and catering industries were also singled out as unfavourable comparisons for childcare which was admittedly ‘lower paid, more demanding and appeals less to the image-conscious’ (§6.2.1) than shop or bar work for young people. This fear was reiterated one year later in the Interdepartmental Review on Childcare. (DfEE, DWP et al., 2002 : 22)

  • 9  Waltham Forest EYDCP, Early Years Development and Childcare Plan, DfES Strategic Target 10, Sectio (...)

18 Early Years Development and Childcare Partnerships striving to meet government objectives to expand the workforce in childcare therefore acted both as co-ordinator for the provision of childcare and recruitment facilitator. Waltham Forest EYDCP for example held quarterly recruitment fairs, ‘advertises aggressively’ locally, and acted as a ‘clearing-house’ for enquiries and vacancies, creating a Childcare Job Bank. With a need to recruit 150 workers every year to cover a workforce turnover of 20 %,9 it created its own recruitment office becoming in all but name an annex to the job centre. It was no longer merely the Department of Work and Pensions and its employment services alone, nor the New Deal advisors working jointly for the benefits offices and Jobcentres, who were actively promoting employment. Semi-public agencies such as the EYDCPs were also active in the labour market under the new arrangements.

19 The labour market therefore appeared to need to respond to the pool of labour available. If difficulties recruiting were apparent, then new opportunities, new qualifications and a new flexibility were needed to help ease parent-employees and non-parents (back) into work in the field. The expansion of the childcare workforce was uneven due to geographical and social factors. How did the New Deal in association with the Childcare Strategy deal with the obstacles to employment and the above labour market difficulties ?

The New Deal - bridging the gap?

  • 10  New improved Jobcentres set up in targeted areas.

20 The metalworkers from Sheffield and Bradford who exemplified the new non-sexist approach to childcare, were also prime examples of long-term unemployed finding employment thanks to the growth in the childcare sector in the absence of industrial opportunities locally. They typified a new breed of employee obliged to retrain from manufacturing professions to the service industry, with the added difficulties of entering the ‘care’ branch and gender considerations. Rather than relocate, they accepted a transformation of their identity and their attitudes, accepting employment which appeared to bring them job satisfaction in addition to self-esteem and financial security. In addition to recruiting into the childcare sector, the New Deal offered help to all parents by facilitating finding and funding of childcare. Every Jobcentre Plus10 was provided with a childcare co-ordinator whose remit was to help those who were taking up or trying to take up jobs under the New Deal find places for their children, thus freeing them to attend interviews, and eventually take up employment.

21 The New Deal for Young People, aimed at under-25 year olds who had been unemployed for more than 6 months, offered intensive help to find work targeting them as possible recruits to the childcare sector. The programme was not specifically intended for parents, indeed, a large proportion of parents seeking to return to work would be above that age range. Special qualifications in Early Years Care and Education or Playwork were created, specifically for young or ‘new’ people considering childcare under the New Deal. These enabled them to go on to a full NVQ 2, acting as an equivalent to other qualifications such as GCSEs which they might not have obtained. (Early Years National Training Organisation, n.d.) Young people employed under the New Deal had to be given the equivalent of one-day per week to study for an approved qualification. Employers could receive a subsidy of £60 per week towards wages and £750 for training for the first six months of employment. Overall statistics for young people returning to work via the New Deal gave a 40 % success rate for sustainable employment (over 13 months) achieved from 1998 to 2002. (Office of National Statistics, 2002) Young people on 26 week-work placements through the New Deal gained a qualification and practical experience while continuing to draw benefit money but no wages. Employers received a cash bonus for a permanent recruitment resulting from such placements (sweetener) and further funds to continue the training programme to enable the young people to gain fully recognised qualification in childcare. (DfEE, 1999 :11)

22 The New Deal for Lone Parents, available automatically to lone parents receiving Income Support whose youngest child is under five, and on a volunteer basis for other lone parents, provides help not only with job seeking or placement on training programmes but also with childcare and childcare costs. The high cost of childcare, estimated at an average £128 per week for a nursery place, and £118 for a childminder (Quarmby, 2003) and difficulties parents on low incomes encountered overcoming this led to a progressive re-evaluation of the Childcare Subsidy from its introduction in 1997 at £60 a week for one child and £100 for two. For these to be paid the training had to fulfil certain criteria. Lone parents receiving Income Support got a financial contribution to their training course, which had to be crucial to finding a job, last no more than 1 year and not exceed NVQ level 2. The maximum length of training, the low level of qualifications for which help was available and the meagre contribution were evidence of the New Deal philosophy. It was intended as a minimum safety net not an ideal maximum. The conditions applied reinforce the idea that this was to help the put the first foot on the “‘climbing frame’ of qualifications for working with children” (DfES, DWP, et al. 2002 : 22) not to help people the rest of the way up. (Carve, 2003) That was left to personal initiative.

23 Childcare work and provision were also of prime importance to other target groups under the New Deal. Older long-term unemployed workers were encouraged to come into childcare under New Deal 50+, with the additional advantage of being paid to act as surrogate grandparents. The New Deal for Disabled People introduced locally with pilot schemes in 2000 and extended nationally in 2001, covered people receiving health-related benefits and was voluntary. The Sure Start web site gave the example of a 31-year old play leader with cerebral palsy. The recent New Deal for Partners of Unemployed People was intended to help them to find work, enable them to update their skills or train for a new career, in line with local employment prospects. Research also showed that the main priority for this group was once more the need for good quality, accessible, childcare. (Stone et al., 2000) 

24 The New Deal for Communities singled out regeneration areas where packages were set up, a form of Social Action Zone. The example of the Thresholds Centre (the name announces its intentions) in Lambeth’s Clapham Park Estate, set up by the Peabody Trust was spotlighted by the government, with the high-profile visit of a successful former single mother Dawn Primarola, Paymaster General in July 2002. The virtuous circle of childcare facilities as ‘Mothers come for company and are drawn into training’ (Toynbee, 2002) was illustrated by the fact that the Centre provided the base for fifty people returning to work in its first year, two hundred qualifications gained and ninety-six new childcare places. The New Deals for Communities were seen to be working as catalysts (akin to the EYDCPs working as facilitators) in bringing community and town hall together, rekindling confidence and co-ordination. (Dvelly, 2001)

25 However the attitudes of the unemployed to the New Deal and to working in childcare sometimes reflected time-honoured wariness of measures to help people back to work According to the New Deal magazine for employers Catalyst, anxious to give the lie to the idea, ‘a lot of people think there’s some sort of ‘con’ with the dole’. Going from unemployment to employment as an employee was one thing, becoming a fully-fledged self-employed worker or employer was another. The same publication highlighted the case of two women who had become managing-owners of a childcare service which had the monopoly of childcare at Skelmersdale in Lancashire and had been set up following their own successful insertion into the labour market via the New Deal. (Jones, 2001)

26 While the New Deal had the praiseworthy ambition of helping people with either little experience and few prospects return to work or get a foothold on the first rung of the apparatus, the question must be raised as to whether it was not a way of procuring a cheap labour force for an ambitious social programme, the Childcare Strategy. Some will admire the efficiency and neatness of the practical solution, making people accept placements and do a full-time job while on benefit, receiving little more than the minimum wage when and if they were taken on at the end of the six months, with none of the hindrances of ideological reservations about state intervention in job creation, left to the private sector (albeit with public money funding the childcare places via parents, but not the jobs). Others may see here yet another example of the whole Welfare to Work perspective generating low-paid jobs. (Whitton, 2000) The 1999 Minimum Wage was set at a rate which would guarantee minimum social protection (high enough to be better than not working) with the maximum economic efficiency (low enough for employers not to balk at taking on workers). It could be argued that the childcare tax credits were a form of subsidised wages in the childcare sector, enabling employers to charge more ‘realistic’ and ‘sustainable’ rates for their places as was recommended officially (DfEE, DWP, et al., 2002: 18) and thus able to recruit and retain staff at attractive wages.

  • 11  House of Commons, Hansard, Written Answers for 11 March 2002 : Column 760W.

27 Criticism of the New Deal for making people artificially and temporarily active when no real jobs awaited them at the end of their 6 month placement was muted in the realm of childcare since there had been a real increase in jobs in the childcare sector. Pump-priming funding had created jobs. However it was admitted that market failure had not necessarily been remedied either in childcare provision or job creation in the field, especially in the most disadvantaged areas where the inverse-care law appeared to operate in childcare facilities as in other fields. Such areas had an average 6-8 places (per 1,000 children aged 0-14) compared to a national average of 12-14 places. Geographical variations were wide. Some Local Authorities had eight times as many playgroup places (per 1,000 children) as those with the lowest provision. (DfEE, DWP, et al., 2002 : 16-17) This was hardly surprising, since the creation of new childcare places had been centred on wealthy areas where parents could afford to pay for the places irrespective of government tax credits to working families. Pilot schemes introduced from April 2004 offering free childcare to lone parents in Bradford, Haringey and Lewisham were a belated admission that publicly subsidised but privately provided childcare was not a perfect solution either for childcare provision or for the creation of jobs. £4 million was reserved for this new initiative for removing barriers to work among this group via the National Childcare Recruitment Campaign. It was also recognised that there might be difficulties inherent in expanding the workforce. As an indication of the importance of this issue, three campaigns (out of a total 35) on which over £500,000 were spent in the years 1998 to 2002 concerned childcare : the Childcare Link in 1999-2000, and Childcare Recruitment. (2000-2001 and 2001-2)11.

28 Despite the publicity, research showed that improvements in subsidising childcare were without effect as, despite the increases in the previous few years, there was a continuing lack of places available in formal childcare. (Chevalier, Viitanen, 2003) For many parents, especially mothers, childcare remained a significant obstacle to employment. Help in finding and funding childcare places does not replace the creation of childcare options, notwithstanding the increased number of places or employment opportunities offered by the sector. Parents and employers were being offered ‘sweeteners’, those wishing to work offered training, experience and jobs in the private sector if and when private initiative was willing to take the risk of opening a childcare business. Childcare provision and jobs follow market laws and are present in the most favourable markets where the customer-parent is able to pay and the business sustainable. The New Deal was presented as a social contract between parents and society, the inactive and employers. State semi-intervention was considered better than state non-intervention in the childcare labour market. Working part-time on low pay rates was deemed better than not working and earning nothing. Childcare provision and the New Deal appeared to be a halfway-house, neither totally public nor completely private. All these factors reflect New Labour government policy towards an active labour market, creating meeting places, partnerships and catalysts but not substituting the state for private initiative in providing childcare jobs or places. The continued expansion of the childcare sector after 2003 modified neither the form nor the underlying philosophy of childcare provision that had been established, building on and extending policies first introduced from 1998 and precepts predating New Labour.

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Chevalier, A., Viitanen, T., ‘The Supply of Child-care in Britain: Do Mothers Queue for Child-care?’ Royal Economic Society’s 2003 Annual Conference, University of Warwick, 2003, .

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1  £135 a week for one child or £200 for two or more children of two parents, or the lone parent  working 16 or more hours a week.

2  £26.50 a week for first child in families with income under £50.000 p.a. (85% of families) and £54.25 a week for those in families with under £13.000 p.a. income (DfES, et al., 2002: 12-13).

3  An independent body founded in 2000 by the Kids’ Clubs Network for a one-year period.

4 Understanding Childcare, Becoming a Working Parent, consulted on 05.10.2003.

5  Islington Council, What Training Courses are Available in Islington,  CIS, February 2002.

6  See for example the PreSchool Learning Alliance, Guide to Training 2002-2003 prospectus; and its Publications and Teaching Resources, Spring/Summer 2002 catalogue.

7  Tax year 1999-2000. In 2001 childcare pay varied from £13.60 to £295 per week, compared to £291.17 to £460.73 per week for classroom teachers.

8 House of Commons, Hansard, Written Answers for 8 February 2001: Column 693W.

9  Waltham Forest EYDCP, Early Years Development and Childcare Plan, DfES Strategic Target 10, Section i. Related EYDCP 2001-2004 strategic target/goal.

10  New improved Jobcentres set up in targeted areas.

11  House of Commons, Hansard, Written Answers for 11 March 2002 : Column 760W.

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Susan Finding, « Full Monty to Humpty Dumpty - the New Deal and childcare », Observatoire de la société britannique, 2 | 2006, 223-239.

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Susan Finding, « Full Monty to Humpty Dumpty - the New Deal and childcare », Observatoire de la société britannique [En ligne], 2 | 2006, mis en ligne le 01 février 2011, consulté le 18 juillet 2018. URL : ; DOI : 10.4000/osb.196

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Susan Finding

Maître de Conférences à l'université de Poitiers

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