EMCC European Monitoring Centre on Change

The childcare services sector - future challenges

This third and final article in the Sector Future series on childcare services focuses on the broad challenges facing the childcare sector in Europe and on the role of the European Commission in the economic and social field, rather than on specific policy issues facing individual Member States. The reason for this focus is that childcare systems and practices in Member States are at different stages of development, both in relation to timing issues and level of maturity. This implies that no one Member State faces exactly the same challenges as another.

The greatest immediate challenge for the European Commission (EC) is to formulate a clear, long-term vision of its aims for the future of childcare services in Europe or, more specifically, care and education in early childhood. Any such vision should be applicable across the entire European Union (EU) and should be fair and equitable between Member States. Equally important is the sustainability of such a vision. Once it has been formulated, the next challenge will be to identify and promote the best strategy and practice to make this vision a reality for the EU.

European policy and decision makers are far from having achieved any of these aims. However, given the increasing investment in children’s futures across Member States, pressure is growing on the EU to mirror these changes in its political focus.

An EU vision

It is unfair to say that the EU has no vision for childcare or for education and care in early childhood. The problem is that this vision appears to be merely incidental and ancillary to its overall macroeconomic goal of continuing economic growth, and its social aim of ensuring that standards of living are improved in a more equal and fair society.

The two elements of the Commission’s current social agenda that are particularly relevant, albeit indirectly, to childcare services are the objectives of eradicating child poverty and the pursuit of gender equality in Europe, specifically equality in the labour market. Alongside this social agenda stands the Commission’s economic policy to increase labour participation and economic output and productivity in the EU. The issue of childcare comes into the picture because the EC believes that the provision of more childcare services will support its economic and social agendas. In effect, therefore, the current EU vision for childcare is for more childcare services. This wish is made clear in the Commission’s Social Agenda 2005-2010 (pdf 2.3Mb):

Without more growth and jobs, it will not be possible to deliver on our social policy goals [modernising and improving Europe’s model of society being the ultimate goal of the Lisbon strategy]. They are the basis for our future prosperity and for raising our living standards. Bringing more people into the labour market and encouraging workers to stay longer in their jobs will be essential to sustain employment growth… And measures to reconcile work and family life, like more childcare facilities, will help parents to take up - and remain in - a job.(2005a, pp. 9-10)

The same wish was also expressed in the Commission’s 2005 report on gender equality (pdf 606Kb):

The provision of adequate [child]care facilities remains the fundamental instrument for allowing women to enter and remain in the labour market throughout their lives.(2005b, p. 11)

In 2002, the Barcelona Summit set out, for the first time, targets for the (minimum) level of childcare provision by 2010 in the Member States: namely, that childcare should be available to 90% of children aged between three years and school-going age, and to one-third of children under three years of age (see European Council, Presidency conclusions, 2002 pdf 300Kb). There is also a growing recognition in EU policy and planning literature that provision of childcare services for children aged under three years is much less well developed than for children aged three years and over. Incidentally, the concept of childcare at EU policy level is much more restricted than the wider notion of early childhood education and care adopted in most Member States. This is of practical relevance, since a narrower definition can give rise to misunderstandings about the precise objectives of EU policy in relation to childcare.

In short, therefore, the EC’s present vision for childcare is to have more services, so that a greater number of parents can join the EU labour market. Thus, the greatest immediate challenge for policy and decision makers in the EU is to overcome the limits of this vision and to focus directly on childcare as a distinct economic activity - an activity with clear economic and social costs, and benefits that centre on the development of children, on the impact of children on the economy and society, and on the economic and social development of their parents.

Should policymakers change their focus in this way, one result is likely to be the emergence of common objectives and aims between Member States in relation to childcare. These will most likely cover minimum levels of provision, childcare choices, quality standards, child outcomes, the economic and social impacts of childcare, and equality for children and parents.

What then are the obstacles preventing the development of such a vision for childcare in the EU? One of the main obstacles appears to be the difficult challenge of formulating a set of common goals and aims for the EU. Most research and literature on childcare focuses on cross-country comparisons within the EU, highlighting differences between Member States, as well as attempting to identify and analyse the best model(s). Less emphasis has been placed on common or generic childcare challenges at EU level, let alone global level.

There are, however, two exceptions in this respect: the Organisation for Economic Cooperation and Development (OECD) and the United Nations (UN) have each produced a key piece of work on more general childcare issues. In 2001, the OECD, after completing a comparative analysis of 12 countries, set out eight key policies that could be applied globally to promote equitable access to early childhood education and high-quality care. One of these policies involves a clear vision of childcare for children from birth to the age of eight years, based on an integrated approach to policy development that draws on a wide spectrum of governmental and non-governmental views, and that promotes strong links across services, professionals, and parents.

In 2004, the United Nations’ Committee on the Rights of the Child set out 17 common recommendations for early childhood development from a human rights perspective (Wilson, 2004). Key recommendations are for UN countries to increase their human and financial resources for early childhood development, particularly public investment, and for governments, government agencies, academics, and representative organisations to ‘continue high-level policy dialogues and research on the crucial importance of quality in early childhood development’.

Therefore, both the OECD and the UN offer an insight into what the EU can aim to achieve through a common childcare vision for Europe.

Best practice and sustainable development

Probably the greatest challenge facing the EU in relation to childcare is determining the optimal practice for providing childcare services, i.e. what is best in terms of outcomes in child development, flexibility and choice for parents, as well as in relation to the underlying economic and social costs and benefits. Equally important, and key to achieving best practice, is the question of whether the type of childcare provision chosen can be sustained on both the demand and supply side: Can spending (by the state, parents or employers) keep up with expectations? Can the childcare workforce grow in terms of volume and quality, in order to sustain demand?

Identifying and achieving best practice in childcare is particularly difficult in an environment in which lifestyle tastes and preferences, working practices, and childcare research are constantly changing, and no EU Member State has yet achieved this goal. Universal childcare is seen by many Member States as a long-term objective; however, the criterion of sustainability is becoming increasingly important in determining the feasibility of this objective. The Thomas Coram Institute points out that the universal childcare model will fail if it is constrained by inadequate funding. A key challenge for the EU, therefore, is to determine the best methods for ensuring that childcare funding is sustainable in the long-term, and to ensure that these methods are compatible with maintaining other features of best practice, such as choice and quality, particularly the quality of the childcare workforce.

The challenge of ensuring sustainable funding essentially comes down to determining the best and most efficient balance between public investment and market forces. Can a public childcare system through supply-side and/or demand-side subsidies guarantee a sustainable, high-quality environment for childcare provision, at the same time, ensuring that parents and children have full and fair choices, and that children and society enjoy the best possible outcomes? Recent evidence from Nordic countries (such as Sweden and Finland), which have universal childcare systems mainly funded and provided publicly, indicates that spending has risen to a level where sustainability has become a serious issue (OECD 2005). On the other side, can a private market that ensures full choice, subject to affordability, come anywhere near to meeting the welfare needs of children?

The real challenge for the EU, therefore, is to identify which model works best across Member States, and whether best practice can actually be applied. Another key challenge is recognising and assessing the overall economic and social costs and benefits of childcare, and whether these costs/benefits are visible or invisible, in the short term or long term. Clearly visible benefits from increased childcare services, for instance, will be the additional growth in output from more parents at work. Less visible costs and benefits may include the psychological impact on parents and children, and the impact on the rest of society.

Before either of those two questions can be answered, however, it will be necessary to find some way of analysing and comparing childcare services across the EU. Wide variations in the provision and funding of services within the EU make sustainability analysis extremely difficult, particularly given the lack of comprehensive and comparable childcare data. In its 2003 research project, the Thomas Coram Institute confirms that:

there is no reliable cross-national comparison of how costs are divided between public and private services, what share parents pay, and what shares employers pay. It is, therefore, impossible to quantify the amount of public and private funding for childcare each year.

To address this problem, the institute suggests that comparable national accounts should be produced. Moreover, international organisations, such as the European Union and the OECD, should act in a coordinated way.

The OECD has provided strategy recommendations for childcare policy, with the aim of promoting the well-being of children and families. These include an integrated policy approach, lifelong learning, universal access, high levels of public investment, improving and assuring quality, continuous and effective training and working conditions, efficient data collection and monitoring, and ongoing research (OECD, 2001). The challenge now for the EU is to do the same.

Many Member States - particularly those in which spending per capita of the childcare workforce is low and that have difficulties recruiting and retaining childcare staff - are likely to find it a daunting challenge to increase their childcare workforce and to ensure that they are capable of meeting the standards of best practice, as well as satisfying growing demand for childcare in the future.

EU convergence

Another key challenge for the EC is ensuring that all parties - children, parents and childcare workers - have the same entitlements across the EU. In theory, this may seem straightforward; in practice, there is a long way to go before this objective can be reached.

On the provision side, the EU has set out minimum targets to be achieved by the Member States by 2010. In relation to funding and subsidies for parents, however, no EU targets have yet been set. Apart from tackling questions regarding how much childcare there should be and who should pay for it, the EC will also have to formulate common policies or guidelines about entitlements to pay and parental leave, about gender equality for working parents, and about quality of childcare. The challenge will be to ensure that there is at least a process of convergence within the EU towards achieving minimum entitlements and standards.

The goal of achieving entitlements for working parents has been a focus of EU policy for some time. In 1992, the Council Recommendation on Childcare, adopted by all Member States, provided a framework of principles for the development of policies to enable parents to reconcile employment and childcare, including services, leave arrangements, changes in the workplace and measures to encourage increased participation by men in the care of children. Progress thus far, however, has failed to go beyond adherence to minimum standards. There remain considerable variations in leave entitlements between different countries throughout the EU, in terms of length of leave and payment. In the UK, for instance, which is a free market economy, leave entitlements are still far less than in traditional welfare economies. Flexible leave is seen by many UK businesses as a form of regulation which restricts production; in welfare countries, flexible leave entitlements are seen as essential for promoting a prosperous society.

Besides leave entitlements, a key challenge for convergence of childcare services throughout the EU is for women and men to have equal access to employment. Statistics confirm that women with small children have a much lower employment rate than women without children, and that the position for men is the reverse. The main reasons for this difference have to do with access to childcare and, probably a more powerful reason, gender stereotypes. The European Commission’s 2005 report on equality between men and women in the EU found that men provide only between 25% and 35% of childcare in households with children aged six years or under (EC, 2005b).

Probably the most effective instrument available to the EC, with which it can implement its employment and social policies, is legislation. EU legislation, thus far, has set out minimum conditions for working in the EU, along with equal rights for workers, including gender equality. This includes minimum maternity and paternity entitlements. Pressure continues to mount for the EU to move further towards common standards of equality, including those pertaining to entitlements for working parents. Apart from legislation, another key instrument is the ‘open method of coordination’ (OMC), which encourages the convergence of national policies towards common EU objectives, through the sharing of best practice. Under the OMC, guidelines or objectives are fixed at EU level and all Member States are encouraged to implement national action plans to achieve these objectives. At some stage, childcare is likely to be brought within the scope of the OMC. Another possible future instrument to promote equality would be through the establishment of a European institute for equality between men and women, to encourage and support the efforts of the European Commission and Member States, in implementing EU objectives for gender equality.

As highlighted in the first article in this series, Childcare services in the EU - what future?, another crucial challenge facing the EU is to ensure convergence of childcare standards across the Member States. At the very least, there is likely to be increasing pressure on the EU to set minimum standards for childcare. In doing this, however, there are likely to be difficulties even at the early stage of setting standards, let alone when comparing progress. Methods of quality assessment can vary significantly between Member States, and quality variables are difficult to compare. For example, one way of measuring quality in this area is to set standards and/or specify curricula. However, the same numerical result on one quantifiable standard, e.g. staff/child ratios, corresponds to very different conditions and levels of quality across Member States. There are also marked differences in approaches to childcare, in the qualifications of supervisory staff and in notions of what constitutes good quality. Other measures, such as child outcomes, parents’ satisfaction, and staff working conditions, may also mean very different things in different countries. In relation to curricula, most EU countries only implement a curriculum for children aged three years and over, although some Nordic countries adopt a curriculum for children from birth.

There is considerable scope for convergence between EU Member States in relation to standards, practices, levels of qualification and working conditions in the childcare sector. Levels of qualifications and expertise, earnings, and status, along with workforce characteristics, currently vary widely between countries. Not surprisingly, the attractiveness of working within the childcare sector varies just as considerably. Countries with the highest levels of investment in childcare have the most mature childcare markets and their economy and society is infused with the values of welfare states. In contrast, countries with the lowest levels of investment in childcare tend to have market-driven economies and/or immature childcare markets.

Expansion of the EU childcare market will be determined by the ability and willingness of the childcare workforce to meet the growing and quality-driven demand. Unless there is a movement towards convergence of labour market conditions, this responsiveness to demand will be far from uniform. A critical challenge for the EU in this respect is ensuring that work in the childcare sector is attractive in all Member States.

All things considered, therefore, the EU faces an enormous challenge if it is to ensure equal standards of quality in childcare for both children and parents. Convergence through common standards across Member States is likely to be slow, but it is not impossible, provided that the determination and willingness to achieve it exists.

Even if common standards are achieved, however, the question will remain as to whether all the important issues on the childcare agenda have been fully addressed.


Daycare Trust, Learning with other countries: International models of early education and care, July 2005, available at: http://www.daycaretrust.org.uk/mod.php?mod=userpage&menu=16&page_id=26.

European Commission, The Social Agenda 2005-2010, Commission of the European Communities, Brussels, May 2005a, available at: http://europa.eu.int/comm/employment_social/publications/2005/ke6605062_en.pdf (pdf 2.3Mb).

European Commission, Report on equality between men and women, Luxembourg, office for Official Publications of the European Communities, February 2005b, available at: http://europa.eu.int/comm/employment_social/emplweb/publications/publication_en.cfm?id=18.

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OECD, Babies and bosses - reconciling work and family life: Volume 4 - Canada, Finland, Sweden and the United Kingdom, 2005, available at: http://www.oecd.org/document/35/0,2340,en_2649_201185_34905443_1_1_1_1,00.html.

Thomas Coram Research Institute, Petrie, P. et al, Early years and childcare international evidence project - Provision of services, Department for Education and Skills, October 2003, available at: http://www.dfes.gov.uk/research/data/uploadfiles/intevpaper2provision.pdf (pdf 506Kb).

Thomas Coram Research Institute, Candappa, M. et al, Early years and childcare international evidence project - Funding and sustainability, Department for Education and Skills, October 2003, available at: http://www.dfes.gov.uk/research/data/uploadfiles/7136paper6fundingandsustainability.pdf (pdf 181Kb).

Thomas Coram Research Institute, Mooney, A. et al, Early years and childcare international evidence project- Summary, Department for Education and Skills, October 2003, available at: www.dfes.gov.uk/research/data/uploadfiles/intevpaper7summary.pdf (pdf 105Kb).

Wilson, P., ‘Recommendations’, Implementing child rights in early childhood, United Nations’ Committee on the Rights of the Child - Day Discussion, 17 September 2004, available at: http://www.ohchr.org/english/bodies/crc/docs/discussion/earlychildhood.pdf (pdf 107Kb).

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