The flaw at the heart of Jeremy Hunt’s childcare budget plans

I once went to Denmark, to report for the BBC on several stories, including one about how good their childcare model was.

It really was quite remarkable. On almost every corner of residential areas there seemed to be a brilliant creche or nursery. They were all modern, warm, safe and very well-run. They were open from first thing in the morning to last thing at night, they could be used by shift workers and temporary workers, just as easily.

They provided excellent food prepared in their own kitchen. They were staffed by well-trained and well-paid professionals. They were stacked to the rafters with toys, games and books for every age.

They were also as cheap as chips to use, so even the wealthiest Danes didn’t bother with private nurseries. State-run ones were just so good it was not worth their while. As a result, everyone got the same start in life and everyone could afford to go to work, rather than stay at home and look after the kids.

If you think this is all typical Scandinavian liberal rubbish, there was a sting in the tail. I recall that if you were unemployed and made use of the nurseries, it was totally free but you had to take the first job you were offered. That meant they didn’t care if you were a nuclear physicist between jobs; if you wanted free childcare you took the job cleaning the bus station toilets, if that was the only thing going.

Compare that to the UK, where apparently the cost of having two children in a nursery is now £15,000 a year. That is far more than the average second income earned by households in the UK. So many women – and it is still mainly women – stay at home because that is cheaper than going to work and giving every penny you earn and more to a nursery.

With a country already desperately short of workers and with a rapidly ageing population this is madness. The UK should be encouraging people to have more children not effectively taxing them at over 100% of their income if they have two or more kids.

It is therefore to be welcomed that the chancellor will apparently give more help to young families, and especially to those on benefits, so that they are not totally crippled by the costs of having children.

Less welcome is the idea that he will change the rules on how many children one member of staff can look after, in order to try to bring down costs and prices. The problem is not over-regulation, it is lack of money.

This government has squeezed benefits and wages to such an extent that it now often does not pay to work, and the economy is short of workers. Unless it does far more, we will also be short of workers in decades to come because the birthrate will fall disastrously.

Another short-sighted policy from a government that thinks you can drive people back to work on any terms if you cut benefits enough, when actually you have to make work pay, and provide decent facilities at a reasonable cost.