MiSoC’s Mike Brewer, Emilia Del Bono and Birgitta Rabe (with Claire Crawford of the Institute for Fiscal Studies), in partnership with the Daycare Trust and the Institute for Public Policy Research, carried out the most comprehensive UK study of the causal effect of free childcare on working mothers and on child development.
They used a variety of data sources – the Labour Force Survey, National Pupil Database, Millennium Cohort Study and Census data – and found positive and statistically significant effects on both child outcomes in school and on maternal labour supply. These effects are relatively small, however, and, in the case of child outcomes, fairly short-lived. For every 100 places funded, around 6 more mothers whose youngest child is 3 move into work. Making free places for 3-year-olds available increases school assessment scores at age 5 by around 4% compared to no funding, but these effects fade out quickly and no benefit remains at age 11.
There is also little evidence that that the policy disproportionately benefitted children from disadvantaged backgrounds, suggesting that it has not worked to close the gap in attainment between those from richer and poorer families (Blanden, Del Bono, McNally and Rabe, 2016).
The researchers found that the main reason the policy has had little impact was that it did not significantly change parents’ use of childcare. 82% percent of three-year old children were already accessing some form of childcare place in 1999 before the age 3 entitlement came into effect. Of six places funded under the policy only one was a new place taken up by a child that would not otherwise have attended nursery. Another way of looking at the impact of the policy is to see how parents respond when their child becomes old enough to be eligible for the free entitlement (at the start of the term after they turn 3). Only about 10 percent of children take up a place as a result of becoming eligible. One reason for this is that childcare places primarily become vacant in September when older children leave to go to school, so this limits the access to a funded place for autumn- and spring-born children.