The political problem of parents priced out of work

The government is slowly waking up to the crisis in affordable childcare.

With the economic climate looking unremittingly bleak, government will have to focus on ways to ease the pain for people on low and middle incomes feeling the famous squeeze. One area that has grabbed ministers' attention is the rising cost of childcare. This is problematic not just because it is a drain on parents' income, but because it can even discourage them from going to work. Eleven per cent of full-time mothers say they stay at home because they can't afford the costs of childcare. Twenty-four per cent of those using childcare say they struggle to meet the cost.

Those statistics -- and plenty more that are equally interesting -- are contained in a new pamphlet by the Social Market Foundation thinktank. It catalogues in some detail the factors that have driven up the cost of childcare as a proportion of household income. Funding and benefits that were introduced at the end of the John Major government (the ability to discount childcare costs from income when applying for housing benefit, for example) and during the Labour government (childcare vouchers, free nursery hours and tax credits) have been frozen or cut, while costs have risen. Meawnhile, as general wages have stagnated, ever more households are relying on two incomes to make ends meet. I recommend the pamphlet -- it isn't too long and is full of useful data -- for a more detailed account of what has happened.

The bottom line is that government will have to step in and rebuild some of the lost subsidy or face more women -- and some men too -- dropping out of the labour market just to look after their children, which is bad for the economy and, in terms of developmental research cited in the report, bad for kids too.

This is an issue that poses a bit of a problem for Iain Duncan Smith, whose Universal Credit (UC) is supposed to make work a more lucrative and attractive option for people currently on benefits. As currently modelled, the UC contains a disincentive for second earners in households with children going back to work (their benefits will be withdrawn faster than would be the case when there is just one earner in a household.) This is either a mistake or, just possibly, the result of a small "c" conservative prejudice about what constitutes a healthy family set-up -- ie. reflecting a view that "second earners", usually mums, should be staying at home with their kids. Official government policy, of course, is to get as many people who can work into work as quickly as possible.

In any case, the government is desperately trying to work out ways to make childcare more affordable, which means finding ways to move money around within a limited pot. Then there is the secondary problem of who in the coalition gets the credit for helping families pay for nursery places. I've written before that this is an area where Nick Clegg and IDS compete for the right to sound compassionate. It is plainly within the DWP remit, but it is Clegg who has flagged up the problem and pushed it at "quad" level -- that is, the committee of four top ministers who coordinate coalition policy.

I understand that an announcement on more childcare support is ready, but that it has been delayed by arguments over who in the coalition should have the privilege of doling out goodies when there is so much doom and gloom dominating the rest of the news agenda.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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After Richmond Park, Labour MPs are haunted by a familiar ghost

Labour MPs in big cities fear the Liberal Democrats, while in the north, they fear Ukip. 

The Liberal Democrats’ victory in Richmond Park has Conservatives nervous, and rightly so. Not only did Sarah Olney take the votes of soft Conservatives who backed a Remain vote on 23 June, she also benefited from tactical voting from Labour voters.

Although Richmond Park is the fifth most pro-Remain constituency won by a Conservative at the 2015 election, the more significant number – for the Liberal Democrats at least – is 15: that’s the number of Tory-held seats they could win if they reduced the Labour vote by the same amount they managed in Richmond Park.

The Tories have two Brexit headaches, electorally speaking. The first is the direct loss of voters who backed David Cameron in 2015 and a Remain vote in 2016 to the Liberal Democrats. The second is that Brexit appears to have made Liberal Democrat candidates palatable to Labour voters who backed the party as the anti-Conservative option in seats where Labour is generally weak from 1992 to 2010, but stayed at home or voted Labour in 2015.

Although local council by-elections are not as dramatic as parliamentary ones, they offer clues as to how national elections may play out, and it’s worth noting that Richmond Park wasn’t the only place where the Liberal Democrats saw a dramatic surge in the party’s fortunes. They also made a dramatic gain in Chichester, which voted to leave.

(That’s the other factor to remember in the “Leave/Remain” divide. In Liberal-Conservative battlegrounds where the majority of voters opted to leave, the third-placed Labour and Green vote tends to be heavily pro-Remain.)

But it’s not just Conservatives with the Liberal Democrats in second who have cause to be nervous.  Labour MPs outside of England's big cities have long been nervous that Ukip will do to them what the SNP did to their Scottish colleagues in 2015. That Ukip is now in second place in many seats that Labour once considered safe only adds to the sense of unease.

In a lot of seats, the closeness of Ukip is overstated. As one MP, who has the Conservatives in second place observed, “All that’s happened is you used to have five or six no-hopers, and all of that vote has gone to Ukip, so colleagues are nervous”. That’s true, to an extent. But it’s worth noting that the same thing could be said for the Liberal Democrats in Conservative seats in 1992. All they had done was to coagulate most of the “anyone but the Conservative” vote under their banner. In 1997, they took Conservative votes – and with it, picked up 28 formerly Tory seats.

Also nervous are the party’s London MPs, albeit for different reasons. They fear that Remain voters will desert them for the Liberal Democrats. (It’s worth noting that Catherine West, who sits for the most pro-Remain seat in the country, has already told constituents that she will vote against Article 50, as has David Lammy, another North London MP.)

A particular cause for alarm is that most of the party’s high command – Jeremy Corbyn, Emily Thornberry, Diane Abbott, and Keir Starmer – all sit for seats that were heavily pro-Remain. Thornberry, in particular, has the particularly dangerous combination of a seat that voted Remain in June but has flirted with the Liberal Democrats in the past, with the shadow foreign secretary finishing just 484 votes ahead of Bridget Fox, the Liberal Democrat candidate, in 2005.

Are they right to be worried? That the referendum allowed the Liberal Democrats to reconfigure the politics of Richmond Park adds credence to a YouGov poll that showed a pro-Brexit Labour party finishing third behind a pro-second referendum Liberal Democrat party, should Labour go into the next election backing Brexit and the Liberal Democrats opt to oppose it.

The difficulty for Labour is the calculation for the Liberal Democrats is easy. They are an unabashedly pro-European party, from their activists to their MPs, and the 22 per cent of voters who back a referendum re-run are a significantly larger group than the eight per cent of the vote that Nick Clegg’s Liberal Democrats got in 2015.

The calculus is more fraught for Labour. In terms of the straight Conservative battle, their best hope is to put the referendum question to bed and focus on issues which don’t divide their coalition in two, as immigration does. But for separate reasons, neither Ukip nor the Liberal Democrats will be keen to let them.

At every point, the referendum question poses difficulties for Labour. Even when neither Ukip nor the Liberal Democrats take seats from them directly, they can hurt them badly, allowing the Conservatives to come through the middle.

The big problem is that the stance that makes sense in terms of maintaining party unity is to try to run on a ticket of moving past the referendum and focussing on the party’s core issues of social justice, better public services and redistribution.

But the trouble with that approach is that it’s alarmingly similar to the one favoured by Kezia Dugdale and Scottish Labour in 2016, who tried to make the election about public services, not the constitution. They came third, behind a Conservative party that ran on an explicitly pro-Union platform. The possibility of an English sequel should not be ruled out.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.