Investment in childcare is essential for north’s economy

Households in the north have a greater reliance on grandparents for childcare than other parts of the UK, says Ulster University's Ciara Fitzpatrick.
A recent survey of Chartered Accountants in Northern Ireland showed that most parents were paying over £1,000 per month per child in fees

Adequate funding for childcare in Northern Ireland has long been neglected as a policy priority of Government. As a result, many providers are struggling to continue in operation and in many cases, parents are paying more than before.

The return of government to Stormont is cause for optimism, not least because childcare provision remains a devolved matter. It’s therefore within the remit of the MLAs to decide if, how, and when to invest in childcare. Whether there is a sustained appetite to do so and more importantly the funding to implement any type of change remains to be seen.

A recent survey of Chartered Accountants in Northern Ireland showed that most parents were paying over £1,000 per month per child in fees. With the main form of assistance with the cost of childcare, Tax Free Childcare, capped at £10,000 per year, parents get a maximum of £2,000 in tax relief each year. This is simply not enough.

As a result of childcare pressures, more and more parents are making the decision to re-arrange their working patterns and in some cases are leaving the workforce completely.

Some 97% of respondents to our survey said that their career or working pattern has been impacted by childcare responsibilities; with over half confirming that they had either reduced their working hours or requested to work flexible hours because of inadequate childcare.

The impact of this on families and businesses cannot and should not be underestimated. Lifting the cap on Tax Free Childcare could see parents some £800 per year better off and increase the attractiveness of remaining in the workplace.

Investment in childcare should be at the backbone of every economy and society – supporting parents to work, lifting families out of poverty, and also delivering significant long-term benefits for children’s development. The economic impact of lost tax receipts as a result of reduced labour market participation cannot be discounted either.

Instead, Northern Ireland families have fallen further behind those in other parts of the UK in terms of the financial support available to them. Which takes its toll not just on parents and children but also on the businesses that they work for.

Despite being a key commitment in the Government’s New Decade, New Approach strategy back in 2020, a childcare policy remains absent in Northern Ireland. It is high-time that words are transitioned into policy; that government recognises that childcare provision is a central part of economic infrastructure and that childcare providers are supported to build a viable business model that offers stability to working parents.

Parents must be enabled to make choices about whether they continue in the workforce or work part-time. No-one should have to choose to postpone their career because of the failures of a system that was established in the first place to support them.

Zara Duffy
Zara Duffy

The time is now to build a system that works for the current cohort of parents, provides high quality childcare for the early learning and development of children, but also takes into account the future demands of the region.

To enable this, we need a long-term whole of government policy that recognises the need to invest in childcare provision. The cap on Tax Free Childcare should be removed, and parents should be entitled to parity with the free childcare that is offered in England.

The system is at boiling point and children, parents, providers and business in Northern Ireland deserve better.

  • Zara Duffy is head of Northern Ireland at Chartered Accountants Ireland