Five ways Covid-19 economic recovery plans must invest in the next generation
This brief is part of our series on ways to limit the impact of Covid-19 on babies, toddlers and the people who care for them. We will be updating these briefs as we collectively learn more. We’d love to hear your examples, ideas and feedback at email@example.com.
This policy brief was updated on 27 August 2020 and is also available in Spanish.
Covid-19’s impacts on families with babies and toddlers are endangering our long-term health, peace and prosperity
As Covid-19 forces governments around the world to rethink economic and social policies, they must prioritise the needs of babies, toddlers and their caregivers.
- The early years of life lay the foundations for future health, productivity, and happiness.
- Amid the crisis, many babies and toddlers are not getting the healthcare, nutrition, responsive caregiving, early education, and protection they need to thrive.
- Money worries, caregiver depression, and increased domestic violence is exposing children to toxic stress that can damage their cognitive and socio-emotional growth.
- This may have long-lasting social and economic effects. The Lancet estimates that children with a poor start in life may “suffer a loss of about a quarter of average adult income per year”.
- Measures to support families with young children generate high returns on investment. Benefits can exceed costs by 15:1 over the medium- to long-term. Former World Bank President Jim Kim called such measures “the best investment societies can make.”
How can economic recovery plans invest in and protect families with young children?
We offer five initial recommendations to support families with young children through economic recovery policies:
- Provide direct financial support to households with pregnant women and children under five. Bundle financial support with other essential goods and skills-building support for families.
- Invest in future pandemic preparedness and public services essential to early childhood.
- Provide dedicated support to the childcare sector as part of general support to SMEs
- Ensure any major firms and industries receiving government aid are actively supporting — and not harming — families with young children.
- Expand access to and uptake of leave for caregiving.
We recognise that these recommendations may not be feasible across all country contexts, but urge those working on economic responses to consider and adapt them as appropriate.
1. Provide direct financial support to households with pregnant women and children under five. Bundle financial support with other essential goods and skills-building support to enhance resilience.
Families with small children face fixed costs. Many may struggle to obtain food and hygiene products. The closure of childcare and schools has led to the suspension of school feeding programs. Caring for young children is a barrier to returning to work. Beyond money, caregivers may need help coping with stress, and guidance on play, feeding and early learning.
- Include top-ups for households with children in social safety net and cash transfer programmes. Where formal records are poor, use community-based targeting.
- Consider extending eligibility periods, increasing allocations for children under 5, and prioritising mechanisms that deliver immediate support: tax credits or rebates, for example, are slower to kick in and may exclude newborns.
- Provide parent support services alongside cash grants, either for all or the most vulnerable. New ideas for remote support are emerging. See our brief on five ways health and social services can support babies, toddlers and the people who care for them.
- Provide food hygiene products, and other items directly to targeted families, for example in slums, informal settlements, camps and other densely-populated low-income areas.
- Develop and provide simple kits — potentially targeted at vulnerable families — to promote positive parent-child interactions and play-based learning.
- Countries lacking permanent child-support grants should consider introducing them.
Who’s doing this?
- Over 30 countries — including middle- and lower-income — have introduced cash transfer schemes, often around 20% of GDP per capita, with top-ups for children and/or reduced criteria or expedited applications for child-related cash benefits.
- National, state, or local governments in over 30 countries are providing support to replace school feeding programmes via cash, vouchers, or direct provision of food.
- Examples of social safety net programmes that incorporate parenting support include Brazil’s Crianza Feliz parenting programme and a World Bank-sponsored programme in Madagascar.
- UNICEF in Jamaica is among organizations providing kits to vulnerable families that include guidance to parents and play materials for young children.
2. Invest in public services essential for early childhood and future pandemic preparedness.
Covid-19 has highlighted many issues that affect early childhood development: chronic under-funding of public services, under-addressing of domestic violence and caregiver mental health, and poor data making it difficult to target assistance and monitor public health. These factors will slow economic recovery. Investing in them will allow countries to respond with greater speed and effectiveness to future epidemics. Cutting funding for these services as a response to fiscal pressures will jeopardize existing investments and increase vulnerability to future pandemics.
- In many countries, local governments provide essential services: address their looming tax shortfalls through measures such as intergovernmental transfers and debt guarantees.
- Invest in social registers, case management systems, and other databases to target social assistance more effectively to the most vulnerable. Simplify birth registration procedures and ensure birth registration continues throughout the epidemic.
- Increase financial support to public services such as primary healthcare, mental health, and domestic violence prevention. Lock in such increases through e.g. minimum budget thresholds and automatic inflation-adjustments. At a minimum, avoid cuts to these essential services in the post-Covid19 recovery phase.
Who’s doing this?
- Various countries have increased funding for domestic abuse services (Australia, France, UK); deployed new channels for victims to seek help (China, Spain); and developed virtual solutions to ensure the justice system can continue to serve those at risk (Colombia, Argentina).
3. Provide dedicated support to the childcare sector as part of general support to SMEs.
“It is childcare that allows every other industry to work.” Childcare facilities must be ready to re-open quickly once physical distancing restrictions are lifted, so caregivers can again be economically productive. But in many countries, childcare outside the home is dominated by formal and informal SMEs or CSOs which are not well placed to survive the loss of income from enforced closures.
As lockdowns have revealed the gaps in support for caregivers, political support is growing for increased resources and “care for carers.”
- Define pre-primary childcare as an essential service, to qualify for additional support in existing policies. Prioritise childcare workers for Covid-19 testing as capacity increases.
- Extend grants, loans, tax exemptions, subsidies, and other financial incentives to the childcare sector.
- Consider additional financial support conditional on meeting minimum standards for quality of care and health and hygiene standards, and step up monitoring and enforcement.
Who’s doing this?
- Countries including the UK, the US and several individual states are rolling out policies to support childcare workers.
- At least nine countries have given families childcare vouchers or credits to provide demand-side support to the childcare sector.
4. Ensure any major firms and industries receiving government aid are actively supporting — and not harming — families with young children.
State support for large industries usually comes with conditions. This is an opportunity to push family-friendly workplace measures.
Similarly, countries that relaxed air quality regulations to support industry during the crisis should reverse this as soon as possible: the harm to children’s physical and cognitive development will generally outweigh the economic benefits.
- Make taxpayer support conditional on compliance with local laws on family-friendly workplaces including parental leave, flexible work arrangements, breastfeeding facilities, etc. Additional criteria could include minimum targets for the uptake of benefits such as parental leave.
- Require firms receiving crisis-related public support to subsidise childcare for employees. Large employers may otherwise seek to cut costs after the crisis by eliminating childcare benefits, on the assumption that such costs will eventually be borne by workers or the state.
- Withhold support from firms with a documented history of violating laws such as child labour conventions or restrictions on marketing of breastmilk substitutes.
- Oppose proposed loosening of air quality or other toxic emissions standards that may be bundled into economic stimulus packages. Rather governments should use stimulus packages to promote industries that contribute to improved maternal and child environmental health.
Who’s doing this?
- At least 10 countries have introduced measures to protect parents, for example compulsory extended childcare leave, wage and social insurance subsidies for absent parents, and/or prohibitions on firing of employees forced to take time off to care for their children due to the pandemic.
5. Expand access to and uptake of leave for caregiving.
Covid-19 has widened appreciation of the importance of enabling employees to take flexible time off for caregiving. Informal and part-time workers are ineligible for compensated leave schemes in many countries. Evidence suggests expanding paid leave supports economic growth and productivity, and may reduce welfare-related costs.
- Expand statutory caregiving leave including parental leave and sick leave. Policies should be flexible, accessible to all workers (male/female, full-time/part-time), and cover at minimum children below school age.
- Incentivise employees to take leave entitlements by eliminating income penalties, publicly ranking large employers, and behaviour change campaigns to shift social norms.
- Introduce automatic payments at birth to cover parental leave for new parents outside formal employment schemes, such as informal or part-time workers.
Who’s doing this?
- Many countries had already expanded statutory leave for caregivers before the Covid-19 crisis, and several have done so in response.
- Several countries have boosted existing universal childbirth payouts, supporting both formal and informal workers (Argentina, Hungary, Serbia, Russia).
Social Protection and Jobs Responses to COVID-19: A Real-Time Review of Country Measures
Impressive, regularly updated list of Covid-19 social protection measures adopted by over 195 countries, with cross-cutting analyses and country-level details (thanks to Megan O’Donnell of the Center for Global Development for this tip). Based on the latest version of this report, we’ve identified the following categories of Covid-19 support specifically targeted at children and/or their caregivers:
Paid Parental Leave: A Detailed Look at Approaches Across OECD Countries
A summary of the evidence on the social, economic, and health benefits of parental leave across the OECD.
Paid Parental Leave and Family-Friendly Policies: An Evidence Brief
A global review, with good references.
Combatting COVID-19’s effect on children
A detailed brief from the OECD on the effects of Covid-19 on children of all ages, and policy challenges and responses. Released just as we published this one, so we have not yet drawn on it in this summary.