Better to borrow

Considering childcare costs, think tank the Social Market Foundation suggests that parents should be loaned money...

With the costs of childcare rising, think tank the Social Market Foundation has made the news with its suggestion that parents should be loaned money –  up to £10,000 – to cover the expense, a sum that would then be repaid over 20 years with interest. It’s a proposal that has provoked a strong reaction.  Neil Leitch, chief executive of the Pre-school Learning Alliance, expressed astonishment that, at a time when the UK’s personal debt has reached £1.45-trillion, such a scheme should be mooted, noting that “Anyone in the banking sector with an ounce of integrity will tell you deferred payment loans are a recipe for disaster.” Acknowledging that 57 per cent of parents polled indicated they would use a loan facility, Neil Leitch suggested that this was simply further evidence of the considerable economic pressures parents were under, rather than a good reason for loaning them more money.

The NDNA, whilst welcoming the SMF’s recognition of the value of investment in high-quality early years education, also expressed reservations, casting doubt on the long-term wisdom of such a scheme. The SMF’s director, Ian Mulheirn, countered with the fact that the money would only be paid back when parents were able to afford it. Given the current climate of austerity, whatever your view on the issue, it’s an idea that may remain on the table for some time to come.