Letter to the Financial Times, Friday 26 February.

Sir, The Institute of Directors claims (report, February 23) that the UK could not cope with the European Union’s proposal to increase paid maternity leave. But there is a wealth of evidence to suggest that the UK’s public finances and economy could benefit from more investment in the early years of childhood.

The UK currently spends £161bn a year tackling preventable social problems that arise from disadvantaged childhoods, including crime, obesity, mental illness and family breakdown: far more than any other country in Europe. The UK is also ungenerous on parental leave: despite being one of the wealthiest countries in the European Union, the UK spends only 0.11 per cent of gross domestic product on parental leave, offers no statutory pay at a full-time equivalent rate and allows fathers to take only two weeks’ paid leave.

Countries that invest in provisions for early childhood, including full-time equivalent paid parental leave and universal childcare, tend to have far fewer social problems, and therefore save money on public services. Finland offers both parents 35 weeks of fully paid leave each and spends 0.81 per cent of GDP on parental leave, but it spends less than a quarter of what the UK does on coping with social problems per head of capita.

The EU proposals also have positive implications for gender equality. Countries that offer more paid parental leave also have a greater percentage of women participating in the labour market, who find it easier to balance family commitments with working life.

Contrary to what the IoD thinks, more paid parental leave would not leave businesses and the state “picking up the bill”, but would deliver real long-term savings, a stronger and more cohesive society and, most important of all, happier, healthier childhoods. Investing in children would be good for us all.

Jody Aked
Nicola Steuer
Eilís Lawlor
nef (the new economics foundation)
London SE11, UK

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