'‘Your money or your life!’ Are there solutions to our astronomical childcare costs?'

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By Douglas Kruger

I have a suspicion that we could double our workforce. Twice the productivity, twice the revenue. And we could do it with the hundred-and-tennish thousand head of cattle already in the paddock; a win all around.

It comes down to childcare.

How many able-bodied professionals do you know whiling away the hours at home, eager but unable to work because child-minding is too expensive. And not ‘slightly’ too expensive. It’s like plonking a packet of crisps on the counter and the cashier saying, ‘£200’. It’s out of all proportion to reality.

Free the child-minder and you liberate untapped human potential. The biggest part of any equality gap in pay is made up of the years mums spend putting their careers on hold. It’s criminal that a highly qualified professional’s entire potential salary can be insufficient to pay for the child-minding that would enable it. That’s a sign of a system vastly out of whack.

Here’s another sign: some Jersey childcare providers now say they are booked up for two years in advance. Need to enrol your child in a crèche next year? Tough.

Let’s just say it. The Island’s child-minding system is broken.

And that makes no sense. Where there is massive demand, entrepreneurs always find a way to supply. Then new entrepreneurs join the fray, bringing down costs via competition. That always happens in a free market. So, what’s out of kilter here?

I’ve heard some strange explanations, like: ‘We’re a small island. That’s why it’s so expensive.’

I can’t make sense of that. The size of our island doesn’t alter the number of children in a classroom. Other places in the world have the same numbers of kids per class, and the cost can be as low as one tenth of ours. How does our being a small island exert any bearing on the number of paying parents per classroom?

So, let’s ask some probing questions in the hopes of getting to the bottom of this economic riddle.

Question number one: Are we putting hurdles in the way of those who could solve the problem right now?

Let’s talk about ‘registered’ versus ‘licensed’.

I know a teacher who lives on the Island and would love to work, but isn’t allowed to, because her husband is here on a registered status. That’s dumb. Criminally dumb. If we torched this single distinction, we would (already) have willing souls present and ready to muck in. The resources that could lower the cost and extend the service are already in place. But they’re shackled by a two-tier system.

As for the spirit of this two-tiered system, it reminds me of Apartheid South Africa. There’s something morally sick about it. Our ‘second-class citizens’ pay all manner of taxes, yet are forced to live as ‘less than’. Could righting this be an easy solution?

Question number two: How much of each monthly payment currently goes to compliance?

Every rule bears an associated cost. More rules, more costs. Bog a system down in compliance, and customers can pay nine pounds out of every ten purely in ‘government permissions’. It’s easy for a well-intentioned government to add gigantic cost to the system: more monitoring, more departments, more zoning, more licences, more protocols, more regulations, more accreditation.

It’s our government. If those permissions are propping up the bulk of the costs, then they must yield, giving way before our needs.

I also reject the idea that ‘more rules’ guarantees the quality of the service.

For starters, it isn’t necessary to insist that every member of staff has government-approved qualifications. Screen them, by all means. But in other countries, only key staff members hold expensive qualifications, and that is sufficient.

Other staff members are comprised of, say, mums looking for entry-level employment. The qualified teachers are always right there, but there are extra minders for the small things, and no one has to jump through expensive hoops to employ them. Schools operating this way are not neglectful death-traps. Speaking from experience, they can be excellent.

Jersey childcare costs anywhere between double to ten-fold more than what we might pay in other nations. So where is the extra expense entering our system?

Bureaucracy overload can be solved, with political will, even while retaining important safeguards.

Scrapping overreaching compliance is a start.

But we can go further.

Question number three: Is the problem as simple as ‘permission’?

Let’s think laterally. Tell me why two or three unemployed mums looking for work couldn’t watch a handful of kids at the park for several hours, enabling half-day employment? Is it because an area must be officially zoned for the purpose? If so, have we found the true source of the problem? The problem is a rule. It can be removed. Are we really saying that a park isn’t safe for a few hours?

What about someone’s backyard? Kids visit one another. They play in backyards. Are we going to pretend that such an arrangement suddenly becomes lethal when we change the label from ‘playdate’ to ‘childminding’?

Make no mistake, it already happens, just, under the table. And that’s not to their shame; human beings must find creative ways around problems that hold back their family advancement. Instead, it’s to the shame of a system that doesn’t enable it. We should free it up.

Or here’s another idea: one big place where there’s just play and sandwiches. That’s it. Use the Fort, for instance. The kids play, several adults watch them, there’s a table with sandwiches and water. Maybe a table with books. That’s it. It’s not a crèche. It’s a play area, but with supervision. Seriously, why not?

Question number four: Is it simple price-gouging?

Could be. Though if it is, I don’t think that’s a fault on the part of the crèches. Hear me out.

In a free-market system, you can charge whatever you want. If the market sustains it, you prosper. But there’s a catch. Others can look at your model and say: ‘Seems lucrative. I’ll have some of that.’

And that starts a process of competition, which does two wonderful things: drives up quality, as entities compete for your business, and drives down prices, as free exchange finds a tolerable equilibrium. That’s not happening here. And therein, I’m convinced, lies our problem.

There is money to be made by anyone who would provide a good service slightly cheaper than existing players. Yet we’re really saying that no one’s taking it up? Something, I put it to you, is stopping them. Costs? Licences? Permission? Some sort of cartel or monopoly scenario?

Competition ultimately solves these problems. But our competition isn’t free, the way it should be. So why not?

Solve for x, and you will change the cost of childcare in Jersey.

Change the cost of childcare, and you’ll free up swathes of talent.

Free up swathes of talent, the whole Island becomes wealthier.

This is a problem worth solving. Problems of this nature are always solved by free-market competition. Something is gumming up the works in ours. So…where’s the gum in our system?

  • Douglas Kruger is an award-winning professional speaker and author. His books are all available via Amazon and Audible. Meet him at douglaskruger.com.

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