What can the UK learn from childcare policies around the world?

Childcare UK
  • Childcare in other developed nations is typically subsidised and invested in by governments to a greater extent than it is in the UK.
  • Looking at childcare provision in other countries, greater investment from government can bring down overall costs for employers to offer working parents more support.
  • Some UK organisations have taken the lead from countries that offer enhanced leave such as Iceland, where equal parental leave is considered the norm.

In March 2023, the UK government announced that by September 2025, every working parent with a child aged under five will be eligible for 30 hours of free childcare, allowing them to return to work as soon as paid maternity leave ends, typically after nine months.

This planned expansion aligns the UK’s childcare provision with Belgium, Denmark, Lithuania, Norway and Slovenia, which all currently offer this to employees. While UK mothers are eligible for up to 39 weeks of statutory maternity pay, and fathers up to two consecutive weeks of paid paternity leave, parental leave tends to be more extensive in many other countries.

Global differences

Childcare in other developed nations is typically subsidised by governments to a greater extent than it is in the UK. For example, in Quebec, Canada, childcare is regarded with the same importance as schools and roads, and since its not-for-profit model was introduced two decades ago, costs parents around C$10 (£6) a day.

Canada is developing programmes that recognise early-years education and childcare as infrastructure, explains Simon Kelleher, head of policy and influencing at Working Families. “The aim is to replicate the subsidised model in Quebec and guarantee that by 2026, parents pay no more than an average of C$10 a day for childcare,” he says. “The approach in Quebec, started in the late 1990s, has significantly increased women’s labour market participation compared to the rest of Canada, and has lowered poverty rates for single mothers.”

Meanwhile, German children from the age of 12 months have a legal right to childcare, with prices ranging from €70 (£62) to €150 (£132) per child a month. Elsewhere, the Luxembourg government provides parents with children aged between one and four a childcare service voucher for reduced rates in creches, childcare centres and childminders, depending on household income, hours of care needed and the type of childcare structure, as well as 20 hours of free childcare spread over 46 weeks a year as part of a multi-lingual education programme for children not yet attending school, regardless of household income.

As a further example, Estonian children from the age of 18 months are guaranteed a free nursery place at a public kindergarten, with private options also available.

In New Zealand, childcare providers with a larger proportion of qualified staff receive higher funding rates, says Sara Hesz, founder of childcare provider Bubble at Work. “In Japan, a similar system of incentivising higher quality care exists, alongside free childcare for three- to five-year-olds,” she says. “Where workers are highly qualified, outcomes for children are overwhelmingly positive. In Australia, a means-tested benefit to help families cover childcare costs was introduced in 2018, and Norway offers kindergarten to children between one and five, with the cost linked to income.”

Furthermore, France offers tax credits for childcare and state-funded creche places to all children from two months old, as well as a flexible budget to put towards a nanny, childminder or nursery depending on preferences.

All of the above are more extensive than US parental leave, which is at the other end of the scale and permits both mothers and fathers at organisations with more than 50 employees to take up to 12 weeks off. Federal law does not require every employer to offer paid parental leave.

Influencing factors

Greater levels of investment from governments can result in more affordable provision and more professionalised childcare sectors, avoiding recruitment challenges as experienced in some industries in the UK.

The economic models of countries that do invest more in childcare, many of which are located in Scandinavia, tend to be more social democratic than the UK in terms of supporting all people regardless of what they earn, explains Kelleher. “This partly explains why Nordic countries offer more generously remunerated parental leave policies, but another key difference is that many of them have also prioritised measures to encourage workforce participation and gender equality.”

Culture also plays a part in how much childcare each country provides, with Sweden, for example, prioritising job satisfaction and motivation more than the US and the UK do, adds Crowley. “In Sweden, the compensation for childcare is far greater and more in line with salaries, which is a much better solution than in [the UK],” she says.

In Sweden, parents are entitled to 480 days of paid parental leave per child. Where parents have joint custody, each is entitled to 240 days, of which 90 days are reserved solely for each parent. One parent can then choose to transfer remaining days to the other. Single parents are entitled to the full 480 days. Parents also receive a monthly allowance to put towards childcare costs.

This enables both parents to manage childcare, explains Lorna Crowley, chief marketing officer and employee engagement specialist at Winningtemp. “Norway and Finland allow an employee to take specific days off if their child is sick at up to 80% of their pay, rather than dipping into their own sick or annual leave,” she adds.

Lessons to learn

Looking at childcare provision in other countries, therefore, higher levels of government investment can bring down overall costs of childcare provision for employers.

Childcare provision is also most effective when it sits as part of a wider parental leave initiative, says Jeff Fox, principal at Aon.

“At the moment, the UK has a way to go to rival leave arrangements in countries such as South Korea and Japan, which offer more than 50 weeks of paternity leave, and Romania, which offers 92 weeks of full maternity pay,” he says. “Interestingly, countries where the cultural or professional barriers are perceived to be highest for fathers to take paternity leave also have the largest levels of leave available.”

If more employers were influenced by those that offer equal or shared parental leave to do so themselves and raise awareness of their provision, this could lead to greater sharing of caring responsibilities sharing between parents, as opposed to working mothers predominantly doing the lion’s share.

Offering shared and equal parental leave above the statutory minimum can have a profound impact on employees’ mental health and help them to feel more supported, says Crowley. “It can also help move away from an unconscious bias during recruitment processes towards women who may go on maternity leave in the future. If more men were to take this kind of leave then they would also consider the impact on their careers, becoming more sympathetic to females.”

A number of UK organisations have taken the lead from countries that offer enhanced leave such as Iceland, where equal parental leave is considered the norm.

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“Dedicated policies are helpful but what is useful is businesses leading the way from the top down,” explains Hesz. “If managers were seen taking shared parental leave, more employees would start to do it too, especially fathers.”

Looking ahead at childcare provision in the UK, it remains to be seen whether increased investment and the planned 30 free hours will be effective, but it could be seen as a step in the right direction in acknowledging rising childcare costs and the resulting talent issues facing employers.