Childcare Reform Act (Debating)

[bore]

I'm not completely committed to the figures, they're just placeholders at the moment, and in fact, doing the figures they seem a bit optimistic.

In Britain the average cost of local authority childcare is 100 pounds a week which is about 150 dollars a week. There are about 40 million children in the US between 4 and 14, 20 million of which would be 50% of 150 and 20 million who would be 25% of 150. For one week of the holidays, if everyone (which is incredibly implausible) was to take advantage of this, that would cost 2.25 billion. It's also worth pointing out that in the UK, free childcare would save 100 million a year , and the UK's population is about 5 times as small and the school holidays are about half as long, so we would probably be looking at around 1 billion dollars, maybe a bit more. I've also included people earning over 100 as getting the discount because there aren't easy figures available and there aren't that many of them, but that's also something to consider.

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[bore]

This bill is specifically designed to deal with children who are at school, yet have to stay at home in the holidays, so as much as I sympathise with Blair's argument, I think that should be addressed by another bill.

I'll run through the figures again. The median cost of childcare per child in the UK as provided by Local Authorities is 100 pounds per week. With the exchange rate this is roughly 150 dollars per child per week. The median household income in the US is 50 000 dollars a year, so with the subsidy in this amended bill, if every child between 4 and 14 (roughly 40 million) were to take advantage of this it would cost 2.25 billion per week. However, for ease of calculation I did not include the fact that households earning over 100 grand would pay the full rate, so even this figure is less.

In the UK, roughly 100 million pounds is lost by the government in taxes because parents have to take the day off to look after their kids, so if we apply the exchange rate the population difference and the fact atlasia has more school holidays, we "get back" about 1 billion dollars.

Obviously not all or even most children will take advantage of this scheme due to going on holiday, other arrangements grandparents, friends etc, so I think 5 billion would be enough to cover this.

[bore]

The reason I cut down on the percentages was because a quick look at the figures meant they didn't stack up. It would be 150 dollars per week per child, with 60 million children at the initial discount rates would be 6.3 billion dollars per week, if everyone took up this offer. I am obviously open to debate on the exact figures though.

Regarding Yankee's points, firstly that's the reason it's in percentages, because as childcare is cheaper in the rural south that means the discount is less in cash terms. Secondly though, means testing often makes sense on paper but not in practice, because the additional bureaucracy costs more than the savings, and I think some sort of cost of living matrix would just ramp up costs. It's also really not the type of thing which can just be applied to regions, because the northeast has lots of cheap rural areas as well, while the south has large cities.

[bore]

I probably haven't worded this clearly enough.

Under the 90/50 discount if every child in atlasia went to one of these childcare places the weekly cost would be 6.3 billion. Now the total number of holidays is about 12 weeks per year, so if every child went every week the cost would be about 75 billion per year.

Now obviously not all or even most children would use this, and those that did probably wouldn't use it for the entire holiday, but it's not clear exactly what numbers would.

[bore]

I probably haven't worded this clearly enough.

Under the 90/50 discount if every child in atlasia went to one of these childcare places the weekly cost would be 6.3 billion. Now the total number of holidays is about 12 weeks per year, so if every child went every week the cost would be about 75 billion per year.

Now obviously not all or even most children would use this, and those that did probably wouldn't use it for the entire holiday, but it's not clear exactly what numbers would.

When did we do this?!

That's the average amount of holiday in the US. I suppose it might be different here but I can't find anything to suggest otherwise.

[bore]

School children have 12 weeks off a year. The whole point of this bill is that parents don't.

[bore]

It's important to remember that it would only be 6.3 billion a week if every child in the country went along, and even then it would be less because I didn't account for the fact that people earning over 100 000 would pay the full rate.

[bore]

If we use the figures I suggested in the amendment the ceiling if everyone took advantage of this is 2.25 billion per week, which is a maximum of around 27 billion dollars. And that's not including that we'll make savings with parent's not having to take sick days and people earning over 100 grand paying the full price, a well as the fact not every child will be in this childcare every week.

[bore]

Well part of the reason (the other, massive one being cost) I decided to reduce the subsidy was to keep some sort of fiscal incentive for not using organised childcare, via sharing kids with friends or relatives or taking holidays and arranging schedules to be off during holidays. I don't want and the intention is not to make it too easy just to dump their kids.

[bore]

I do sympathise with the argument about inflation that yankee puts forward, but I would like to make two important points here:

Firstly, the alternative to having a percentage subsidy is a certain amount of money, and, barring some cost of living formula which would be an administrative nightmare, that would lead to people in cities being hit the hardest, while in cheaper areas people would get almost full cover.

The other point is childcare is not university, for one thing the cost of setting them up and shutting them down is negligible, whereas we couldn't just abolish yale. The other is childcare doesn't have an aura about it. The market for higher education is incredibly inefficient partly because so much of it is down to reputation. Yale can charge as much as it likes because it's reputation is such that people will still be willing to pay it, but if I was to set up a university of the same quality from scratch, the prices would have to be much lower. Whereas people just want their child to be somewhere safe and fun anf cheap.

As well though, and this probably needs some clarification, I envisage this act guaranteeing parents a childcare place, not the childcare place they necessarily would choose if money was no object, in the same way a local authority guarantees a place at a school, not one at the best school in the region. If a childcare centre charges too much the relevant authority could simply stop sending children to it.

[bore]

I am not criticizing the presence of a percentage, in fact it is undoubtedly a better approach with regards to the inflation concern then say that of an overal sum as Polnut has referenced. I would support his strict basis, which I think can chart a middle course between simplicity on the one hand and dealing with the inflation concern on the other.

Mr. President, do you think it totally impossible for childcare facilities to garner a certain reputation and thus have a similar, if not quite to the same extent, effect as the aura of a prestigious institution of higher learning?

Not impossible, but very unlikely, and if it did it would only be a very small factor.  Really though the important point is the in the third paragraph. This wouldn't be a matter of parents choosing some childcare and then the state giving a generous discount (which I agree would be ripe for abuse) but a matter of the state offering the parents some childcare, and the parents deciding based on that.

[bore]

It's true that it doesn't say anything about cheapest (though we could put that in- and if we do that we'd have to specify a few minimum standards) but I can't imagine the people running this would deliberately offer places at really expensive places instead of cheap ones.

[bore]

OK, does anyone here want to propose an amendment?

[bore]

It would very much depend on what those conditions were. If they were just to do with quality then we'd have a university tuition fee hyperinflation situation pretty quickly. If they included cost as well that's slightly different, but again we'd have to be very careful, lest we get a situation where, as often happens with price controls, it just becomes uneconomic to supply any childcare.

My favoured solution is something similar to schools where the government guarantees childcare (although actually, now I think about it, this should probably be qualified so that childcare is not expected to be delivered to people living in an incredibly remote village or farm) but not specific ones. So people would be allowed to claim the discount for at least one, and maybe more childcare centres.

[bore]

Yeah, yankee has summarised what exactly we need to deal with here. I'll try and come up with some sort of more fleshed out amendment over the weekend, but if anyone has any ideas/proposals I'd be very interested in seeing them.

[bore]

The problem with super gradated means testing, or super gradiated anything, is very soon it becomes more expensive in terms of bureaucracy than it would be just to universalise it.

[bore]

The problem with super gradated means testing, or super gradiated anything, is very soon it becomes more expensive in terms of bureaucracy than it would be just to universalise it.

     The benefit of the sliding scale is that it would make the gradation continuous, so deciding the proper amount would be a matter of a simple calculation that could be done in Excel. It would hardly require tons of bureaucracy to handle that.

It's easy enough to do for a few people, yes, but when you deal with a population the size of atlasia then I think you would run into bureacracy costs. For instance you'll need people to submit all their incomes and people to input that and run the database and so on.