Childcare Advance Hillingdon Pilot project report 2012

Childcare Advance
Hillingdon pilot project
report 2012

02 Childcare Advance
Hillingdon pilot project report 2012
Contents
Executive summary 03
1. Project outline 04
2. Childcare Advance loans 05
3. ‘Into work – what to expect’
workshops 07
4. ‘A parent’s guide to moving
into work’ factsheet 09
5. Parent survey 10
6. Discussion of project outputs 14
7. Recommendations 17
Appendix 18

03Childcare Advance
Executive summary
Project outline
The aim of the Childcare Advance Hillingdon
pilot project, funded by Calouste Gulbenkian
Foundation from November 2010 to February
2012, was to help reduce child and family poverty
by decreasing childcare cost related debt which
is a significant barrier to entering and staying
in work. The project set out to achieve this by
increasing access to low interest credit to pay
for childcare fees in advance, and increasing
awareness of the help available to parents whilst
they look for and move into work.
The pilot consisted of three elements; the
Childcare Advance loan offer, support and advice
to parents who were looking for or starting work
and a research element to assess the outcomes
of the pilot model.
The Childcare Advance Hillingdon pilot project
was delivered by Daycare Trust, Hillingdon Credit
Union, Hillingdon Citizens Advice Bureau and
eight other partner organisations who all work
with parents in Hillingdon through housing,
employment, education/training and advice
services.
Project outputs
No loans were taken out during the project
delivery period; however, two loans have been
taken out in March 2012.
Seven ‘Into work – what to expect’ workshops
were delivered in Hillingdon and neighbouring
boroughs. ‘A parent’s guide
to moving into work’ was published in
September 2011.
A survey of parents’ attitudes to borrowing money
for up-front childcare costs was carried out in
January and February 2012. Key findings were:
• half of the respondents hadn’t heard of credit
unions;
• half of the parents who answered said that
they would borrow money to pay for up-front
childcare costs;
• the most important factors for parents when
considering borrowing money were that the
money is from an organisation/person they trust
and low interest rates.
Recommendations
As the only loans to be taken out were granted
after the project delivery period, the original aim of
this pilot project to make recommendations for a
national roll out of Childcare Advance loans is not
possible. Instead, the following recommendations
are offered to inform any future work focusing on
the up-front costs of childcare and to support the
continued offer of Childcare Advance loans by
Hillingdon Credit Union. The recommendations
are aimed at central government (particularly
the Department for Work and Pensions), local
authorities, Jobcentre Plus and any other
organisations involving in supporting parents to
return to work.
1. Increase awareness and understanding of the
credit union.
2. More targeted promotion of the Childcare
Advance loan to parents who are at the point of
starting work, for example through employers
and childcare providers.
3. Up-front costs of childcare should be included
in broader support for parents to meet childcare
costs.

1. Project outline
Background
In November 2008, Daycare Trust was awarded
funding from Friends Provident Foundation for a
project to investigate which parents experience
difficulty meeting the up-front costs of childcare
and how much of a barrier to work this created,
the existing help available and to suggest options
for a sustainable scheme that would offer financial
help to parents with these costs.
Over half of the parents surveyed for this research
reported struggling to meet the up-front costs of
childcare with 21 per cent reporting that up-front
fees affected their decision to start work. One of
the proposed solutions to overcome this barrier
to work was to offer loans to parents who are
starting work; these loans could be offered by:
• employers offering an interest-free loan repaid
by payroll deduction;
• family Information Services and credit union/
community development finance institution
offering a low interest loan; or
• registered social landlords and credit union/
community development finance institution
offering a low interest loan.
The project decided to recommend a loan
rather than a grant to increase the long-term
sustainability of such a scheme. Copies of
the executive summary and full report can be
downloaded from www.daycaretrust.org.uk.
This pilot scheme, funded by Calouste Gulbenkian
Foundation combines the last two options to
offer low interest loans to parents through a
partnership of the Families Information Service
and registered social landlords in the London
Borough of Hillingdon, allowing two of the
proposed solutions to be tested.
Aim
The aim of the Childcare Advance Hillingdon
pilot project was to help reduce child and family
poverty by decreasing childcare cost related
debt which is a significant barrier to entering and
staying in work. The project set out to achieve
this by:
• increasing access to low interest credit to pay
for childcare fees in advance; and
• increasing awareness of the help available to
parents whilst they look for and move into work.
The pilot consisted of three elements; the
Childcare Advance loan offer, support and advice
to parents who were looking for or starting work
and a research element to assess the outcomes
of the pilot model.
Objectives
The objectives of the project were to:
• promote the availability of low interest loans
from Hillingdon Credit Union to pay for childcare
fees in advance where parents were not eligible
for other help;
• monitor the take-up and repayment of loans
in order to evaluate the scheme’s potential for
national roll-out;

05Childcare Advance
• provide financial inclusion training to parents
to support their money management and
make work sustainable; and
• investigate parents’ attitudes to credit unions
and credit.
Project structure
The Childcare Advance project was delivered by a
partnership of organisations working with parents
in Hillingdon, co-ordinated by Daycare Trust.
Childcare Advance loans were offered and
administered by Hillingdon Credit Union.
Financial inclusion training was developed and
delivered by Hillingdon Citizens Advice Bureau
and Daycare Trust.
Loans and workshops were promoted to
Hillingdon parents through the following partner
organisations:
• Hillingdon Families Information Service;
• Shepherds Bush Housing Group;
• Catalyst Housing Group’s Pathways to
Work scheme;
• Thames Valley Housing Association;
• Odu-Dua Housing Association;
• Hillingdon Homes;
• Uxbridge College; and
• Jobcentre Plus.
Daycare Trust developed policies and procedures,
publicity and information materials and collated
and evaluated the project.
Loan offer
Hillingdon Credit Union has an established
presence in the borough and offers outreach
sessions at community settings including a
number of children’s centres, which made it a
good service through which to offer loans. To
ensure that the loans were sustainable and fit
within its existing framework, Hillingdon Credit
Union agreed to an initial offer of Childcare
Advance loans to five parents. Further loans
would be agreed on condition of the successful
repayment of these initial loans.
The recommendations of the scoping research
project were followed and Childcare Advance
loans were offered:
• to parents:
living or working in Hillingdon; and
starting work (full time or part time); and
with a household income of up to £40,000
per year (at the point of application); and
who are a member of Hillingdon Credit
Union1
; and
• for up to four weeks childcare fees in advance
up to a maximum of £1,000.
Loans were offered to parents who were not
eligible for other help towards the costs of
childcare fees, for example from Jobcentre Plus.
Loan applications were subject to the standard
credit checks carried out by Hillingdon Credit
Union and could be refused.
2. Childcare
Advance loans
1
Membership and loan applications could be made at the same time.
All members are asked to commit to saving a minimum of £10 per month.

Childcare Advance loans were offered at a rate
of 26.82% APR (2% per month on the declining
balance) and had to be repaid within 12 months.
Repayment was available and encouraged
through deductions from benefits, for example,
Child Benefit, paid directly into the parent’s credit
union account with the balance either being
diverted to their credit union savings account or
to another bank account.
Loan publicity
Childcare Advance loans were publicised through
the project partner organisations who all work
with parents in Hillingdon through housing,
employment, education/training and advice
services. Overall, publicity reached more than
9,000 parents in Hillingdon through a variety of
media including;
• distribution of leaflets;
• displaying posters;
• one-to-one discussions with parents looking
for or about to start work; and
• articles in organisation/estate newsletters.
In total, 6,000 flyers and 100 posters were
distributed to organisations in Hillingdon. The
loans have also been publicised on the Hillingdon
Credit Union and Hillingdon Families Information
Service websites as well as Uxbridge College’s
student intranet.
Interest/take-up
Within the project delivery period, five enquiries
were made to Hillingdon Credit Union and two
loan applications were received. Unfortunately,
neither of the parents was eligible; one had
previously defaulted on a loan and the other had
been in work for some time. However, in March
2012 the first Childcare Advance loan of £400 was
paid to a woman returning to work after maternity
leave. At the time of writing, a second loan for
£750 has been referred to the Credit Committee
for approval.
Following a talk with Jobcentre Plus staff by the
West London Financial Inclusion Champion and
their subsequent promotion of the loans and
Hillingdon Credit Union, four new parents joined
the credit union as regular savers.
Future of Childcare Advance loans
Hillingdon Credit Union will continue to offer
Childcare Advance loans for a further 12 months
beyond the delivery period of this pilot project
(until March 2013). It is also developing links
with employers in the borough with a view to
promoting credit union membership to their
employees and will include a loan for childcare
costs (repaid through payroll deductions) for new
starters in its offer of services.
Daycare Trust will continue to liaise with
Hillingdon Credit Union to monitor future take-up
of loans.

07Childcare Advance
Workshop outline
A two-hour workshop was developed by Daycare
Trust and Hillingdon Citizens Advice Bureau to
support parents to plan for and manage the
transition from benefits to work.
The objectives of this session were for parents
to be able to:
• understand the changes to their benefits when
they move into work, for example to Child Tax
Credit and Housing Benefit;
• identify the extra financial help available during
the transition to work and whilst in work, for
example the Job Grant, Extended Payments of
Housing Benefit and help with childcare costs;
and
• understand the advantages of saving money.
The workshop was designed to pass on
information about benefit entitlement and
to facilitate discussion and the sharing of
experiences between the parents attending.
Delivery of the workshop was offered free of
charge, although hosts were asked to provide
a venue and co-ordinate attendance. The
workshop was offered to Childcare Advance
partner organisations, children’s centres, Work
Programme delivery organisations, housing
associations and other community or parent-
focused organisations in Hillingdon.
The workshop was developed for parents, but
members of staff were encouraged to attend to
enable the information to be cascaded to other
parents they work with.
These financial inclusion workshops were also
used to further explore the attitudes of parents to
credit and borrowing money, both by monitoring
feedback offered in group discussions and by
adding a question to the workshop evaluation
form which all parents were asked to complete.
See the feedback section below.
Workshop delivery and attendance
The ‘Into work – what to expect’ workshop
was delivered from March 2011. A total of 15
workshops were organised but only 7 were
delivered due a lack of sign up by parents.
Of the parents who attended the workshops2
:
• 29 were female, 1 was male;
• 11 were aged 25-34 years, 12 aged 35-44 years,
3 aged 45+ years and 4 were aged 16-24 years;
• 3 considered themselves to have a disability;
• 14 had an income3
from benefits, 7 from
benefits and employment, 4 from employment
and 5 didn’t respond; and
• ethnic groups included; African, British, British
Asian, Chinese, Iranian, Japanese, Pakistani,
Polish, Romanian, Somali and West Indian.
3. ‘Into work – what to expect’
workshops for parents
2
statistics from the 30 monitoring information forms completed
3
income cited was the family income

Date Organisation (borough)
Number of parents
signed up
Number of parents
who attended
Number of advisers/
staff who attended
28/3/11
Catalyst Housing Pathways to
Work (Hillingdon)
5 3 2
12/7/11
Peabody Housing Association
(Hillingdon)
7 4 1
31/8/11
A2Dominion Housing Association
(Hillingdon)
4 2 3
12/9/11
Shepherd’s Bush Housing Group
(Hammersmith)
10 6 0
29/11/11
A2Dominion HA/Hounslow
Homes (Hounslow)
10 7 1
12/12/11
Charville Children’s Centre
(Hillingdon)
14 6 1
20/2/12
Harefield Children’s Centre
(Hillingdon)
7 5 0
TOTAL 57 33 8
Feedback
Feedback from the workshops showed that 13
parents would take out a Childcare Advance loan,
2 might take out a loan but 14 of the parents who
attended wouldn’t (2 didn’t respond).
The reasons given for not taking out a loan
include:
“I try to avoid any types of these which might
bring you into debt. We had [sic] experienced
that before”
“Due to my religious background am not sure
whether I can”
“I’ll try from the money I am receiving, I want to
ignore loans”
Workshops delivered
In response to the question about how confident
the parents felt to manage the move into work,
• 12 of parents who attended were fairly
confident or very confident;
• 5 were neither confident nor unconfident; and
• 11 were fairly unconfident or very unconfident.
Future workshop delivery
Course materials and guidance will remain
with Hillingdon Citizens Advice Bureau to allow
for delivery of the ‘Into work – what to expect’
workshop to continue beyond the end of the
Hillingdon pilot project.
The workshop has also been added to Hillingdon
Citizens Advice Bureau’s six-week ‘Managing your
Money’ course offered through children’s centres
and community organisations.

09Childcare Advance
‘A parent’s guide to moving into work’; a ten
page factsheet for parents, was produced in
September 2011 to support the ‘Into work –
what to expect’ workshop and as a resource
for parents in England.
The guide was written by Daycare Trust and was
checked by Jobcentre Plus.
‘A parent’s guide to moving into work’ includes:
• Information about financial help for parents
when they are:
looking for work
moving from out of work benefits to work
in work (long term)
• Back to work checklist
• Contacts for further information
The guide has been disseminated through the
project partner organisations, to workshop
participants and host organisations and is
available as a free download from the Daycare
Trust4
and Paying for Childcare5
websites.
To date there have been 150 downloads of the
factsheet from the Daycare Trust website (figures
are not available for the Paying for Childcare
website) and the following feedback was received
from a London borough representative: “a very
informative and well written fact sheet.”
Future
This guide will continue to be available from the
Daycare Trust and Paying for Childcare websites
beyond the end of this project and will be
updated as required to ensure it remains a current
resource for parents.
4. A parent’s guide to moving
into work
4
www.daycaretrust.org.uk/pages/-factsheets-for-parents-63.html
5
ww.payingforchildcare.org.uk/pages/factsheets.html

A survey of parents’ attitudes to borrowing
money was carried out in January and February
2012. The survey was disseminated to parents
throughout Hillingdon and neighbouring boroughs
by the project partner organisations and children’s
centres involved in the project.
The survey was open for five weeks and was
primarily available online although paper copies
were also distributed by the Families Information
Service, Citizens Advice Bureau and a children’s
centre in Hillingdon. A prize draw for £100 high
street vouchers was offered as an incentive and
all parents who gave their contact details were
entered into the draw. The survey questions are
given in the Appendix.
120 parents responded to the survey, with 72
parents completing the full survey. The survey
asked parents about their awareness and
membership of credit unions, whether they would
consider borrowing money to pay for up-front
childcare costs and if so, who they would borrow
from and their attitudes to different sources of
credit/help.
Credit unions
Of 120 parents who answered the first question
about knowledge of credit unions, 49 per cent
said they hadn’t heard of credit unions, 32 per
cent had heard of them but didn’t know what they
did and the remaining 19 per cent had heard of
credit unions and knew what they did.
Of the 61 respondents who had heard of
credit unions, only 7 were members. The
most popular reasons for not joining were that
respondents didn’t know what credit unions do
(25 respondents) or that they already had a bank
account (20 respondents).
Borrowing money to pay for up-front
childcare costs
Half of the 74 parents who answered said that
they would borrow money to pay for up-front
childcare costs whilst a third wouldn’t (the
remaining respondents said they didn’t know/
weren’t sure).
Figure 1 (below) shows which sources of credit
parents would turn to for help with up-front
childcare costs. Family members and friends are
clearly parents’ preferred options followed by
bank loans/overdraft. Encouragingly, the lowest
responses were for high-cost credit (doorstep and
payday loans).
5. Parent survey

11Childcare Advance
0
10
20
30
40
50
0 10 20 30 40 50
Figure 1: From which of the following sources would you get help to pay for up-front childcare costs?
Figure 2: The three most important things you would look for when borrowing money
Figure 2 shows the factors parents consider to be the most important when borrowing money. The top
three responses were: that the money is from a person/organisation I trust; low interest rate and the
person/organisation is flexible about repayment of the money. These all concur with the preferences
given in the previous question to borrowing from family members, friends and banks.
Family
member
I know someone else that has borrowed
money from that source
Simple application process
I can get the money quickly
The person/organisation will understand
if I have difficulty repaying
Flexibility about when I need to
repay the loan
Low interest rate
It is from a person/organisation I trust
48
7
15
16
23
Count
Count
25
44
46
21 20
16
10 10
8
1
Friend Bank loan/
overdraft
I wouldn’t
borrow
money to
pay childcare
costs
Credit card Credit union Payday loan Doorstep
loan

0
10
20
30
40
50
60
70
80
Figure 3: Borrowing money from any source
The third section of the survey asked for more
information about parents’ attitudes to different
sources of credit. Full responses can be seen in
figures 3-5.
The strongest messages from the responses
were that parents:
• don’t want to get into debt; three quarters of
parents agreed with the statement ‘I don’t
want to get into debt’;
I wouldn’t borrow money (from any source) to pay up-front childcare fees because...
• don’t want to pay back interest on borrowed
money; three quarters of parents agreed with
the statement ‘I don’t want to have to pay back
any interest’; and
• reported family members and friends as being
a viable source of credit; more than half the
parents who responded disagreed with the
statement ‘I don’t know anyone who would/
could lend me the money’.
borrowing money
goes against my
personal values
I don’t want to get
into debt
I can use childcare
that doesn’t require
up-front
I can afford to pay
up-front childcare
fees without
borrowing money
12
3
15
13
12
5
2 9
17
10
28 20
13
12
12
15
18
42
11
13
Count
5 (Completey
disagree)
4
3
2
1 (Completey
agree)

13Childcare Advance
0
10
20
30
40
50
60
70
80
0
10
20
30
40
50
60
70
80
I don’t want to have to pay
back any interest
I don’t want to have to pay
back any interest
I don’t think a bank would
lend me money/I’ve been
turned down for a loan,
overdraft or credit card
before
I don’t think a bank would
lend me money/I’ve been
turned down for a loan,
overdraft or credit card
before
I don’t think a bank
would be flexible or
understanding if I was
struggling to repay them
5 (Completey
disagree)
4
3
2
1 (Completey
agree)
5 (Completey
disagree)
4
3
2
1 (Completey
agree)
CountCount
Figure 4: Borrowing from a bank loan/overdraft/credit card
Figure 5: Borrowing from a friend or family member
I wouldn’t use a bank loan/overdraft/credit card to pay up-front childcare costs because...
I wouldn’t borrow money from a friend or family member
to pay up-front childcare costs because...
Finally, respondents were
asked the maximum amounts
they would borrow from both
professional lenders and
friends and family members to
pay for up-front childcare costs.
The results showed the median
amounts parents would borrow
as £500 from professional
lenders – less than the £1,000
offered through the Childcare
Advance loan – and £300 from
friends and family members.
Interestingly, these amounts
correspond with the median
up-front costs of £300-£500
incurred by parents surveyed
for the Childcare Advance
scoping project research.
6
30
6
2
12
8
8
14
21
19
7
12
36
8
24
8
17
10
24
17
15
16
919
5

Discussion with project partners and others
involved in the project suggest that the following
factors are significant in assessing the outcomes
of the Childcare Advance Hillingdon pilot project.
Economic climate
The timing of this pilot project (November
2010-February 2012) was unfortunate as it fell in
a period of recession and rising unemployment,
which could affect both the rate of parents
returning to work and attitudes and behaviours
towards borrowing and credit.
• The number of economically active unemployed
people in Hillingdon has steadily increased from
6,500 in July 2007-June 2008 to 11,500 in July
2010-June 2011 (8.2% of all economically active
people in Hillingdon – higher than the rate of
7.7% in Great Britain).
• In March 2011 there were 965 unfilled jobcentre
vacancies in Hillingdon.
• 12.4% of economically active women were
unemployed in Hillingdon in the period January-
December 2010 compared with 6.6% in Great
Britain6
.
Daycare Trust and Save the Children’s parent
survey in spring 2011 reinforced the need to
address the barrier to work created by childcare
costs. The survey of 4,000 parents found that
difficulties accessing childcare – including cost –
are significantly affecting the ability of parents in
severe poverty to work, train or study7
.
Attitudes to debt/borrowing money
Anecdotal feedback from parents given to
Families Information Service and Jobcentre Plus
officers suggests that parents are reluctant to
take out a loan and incur debt, particularly in the
current economic climate. This is supported by
the findings of the parent survey carried out for
this project, a reported general fall in loan take-up,
and wider social research carried out into attitudes
to debt and credit.
To further investigate the reasons for the lack
of take-up or interest in the loans, a survey of
parents’ attitudes to borrowing money was carried
out in January–February 2012 as part of this
project. Whilst half of the parents who responded
to the survey said that they would borrow money
to pay for up-front childcare costs, the preferred
sources of help are family members and friends
and, to a lesser extent, banks. This concurs with
findings that the most important factors when
borrowing money were borrowing from a trusted
source and low interest rates. Further findings are
given on pages 10-13.
Hillingdon Credit Union report having seen a
reduction in the value of loans taken over the last
12 months generally; a trend also found by the
Consumer Credit Counselling Service8
. Based on
the circumstances of its clients, the Consumer
Credit Counselling Service found that debt levels
were dropping as people seek to reduce the
money they borrow. Its statistics also show that
6. Discussion of project outputs
6
All statistics from www.nomisweb.co.uk
7
Making work pay – the childcare trap (Daycare Trust and Save the Children, 2011)
8
Statistical Yearbook 2011 (Consumer Credit Counselling Service, March 2012)

15Childcare Advance
households with dependent children owe 21 per
cent more than households without children on
average.
Data collected for a 2009 study carried out by
the Personal Finance Research Centre suggested
a hardening of attitudes to credit by the adults
interviewed and found that the desire to reduce
borrowing was often expressed. Evidence
was also found of a ‘correction’ to consumer
attitudes to, and behaviour towards spending and
borrowing either based on direct experience or
present or future uncertainty about the level of
household and wider economy. Even if people
were unaffected by economic downturn, they
were found to be exercising ‘precautionary
restraint’.9
In a survey of 2138 people carried out in
November and December 2010, 53 per cent of
respondents said that money (debt and bank
balance) was one of their biggest worries in 2010
(compared with 48 per cent in 2009).10
It is also worth noting that some organisations
were uncomfortable about promoting loans to
their clients because of concerns that it would
encourage them to build up debt.
The concept of taking out a loan to pay for
childcare costs, however, is not something
that parents appear to be against in principle.
The Social Market Foundation report ‘A better
beginning: Easing the cost of childcare’
(Shorthouse, Mulheim and Masters, 2012)
recently proposed a National Childcare
Contribution Scheme to take advantage of the
Government’s low cost of borrowing to enable
parents to manage ‘punishingly expensive’
childcare costs. Money used through this scheme
to pay for childcare would be repaid (contingent
on income) at an interest level of three per cent
above inflation. In their survey of 502 parents of
children aged under five, 27 per cent of parents
said that they were likely to use this scheme.
Knowledge of credit unions
Being required to join Hillingdon Credit Union to
be able to take out a loan could also have been a
deterrent for parents who don’t understand how
credit unions work. The findings of the parent
survey for this project show that 50 per cent of
respondents had not heard of credit unions –
and only 19 per cent of had both heard of credit
unions and knew what they did.
Hillingdon Credit Union acknowledges that Credit
Unions are not well understood in the UK but that
there is a concerted effort underway to change
this. On a local level, they would like to do more
to promote their services to a wider audience
but with limited resources to do this themselves,
they are reliant upon other organisations also
publicising their services and loans.
Feedback received through the workshop
9
Facing the squeeze: A qualitative study of household finances and access to credit in a 21st century recession, Collard, Finney & Crosswaite (Personal Finance Research
Centre/ECOTEC Research and Consulting Ltd, 2009) www.infohub.moneyadvicetrust.org/content_files/files/090928_facing_the_squeeze_exec_summ_final_2.pdf
10
‘Worries 2010’ (Samaritans/YouGov, 2010) www.infohub.moneyadvicetrust.org/resource.asp?cat_id=278&rPath=cat&r_id=624

sessions has also highlighted some confusion
about the interest rate of the loan and a lack of
understanding of interest rates and APR which
suggests that further financial inclusion work is
needed to ensure that parents fully understand
their options to pay for one-off costs such as
childcare fees in advance.
Point of contact/loan promotion
In discussion with the partner organisations,
concerns were raised that the timing and contact
point for the loan offer is also an issue for the
promotion of the Childcare Advance loans.
Speculative publicity was sent to parents without
any knowledge of what stage of the work-seeking
process they were at, and workshops were
attended by parents who were often at the earlier
stages of job search, both of which allowed for
a potentially significant time lag between the
parents receiving the information about the loans
and actually needing help with fees in advance.
This approach of broad promotion was adopted
in order to reach as many parents as possible, but
more targeted promotion at the point of starting a
job is likely to offer a better opportunity to explain
and encourage take-up of any financial help
available. In addition, with some help available
through Jobcentre Plus through discretionary
funding and the Job Grant payment11
, a more
targeted approach would allow the loans to be
promoted to parents who don’t have access to
other help, for example, couples families when
the second parent starts work, maternity leave
returners. It was suggested that more appropriate
points of contact could be childcare providers or
employers (see Recommendations).
Other
Religion also seems to be a factor in some
parents’ choices about whether they would take
out a loan as Muslim parents who attended the
‘Into work – what to expect’ workshop raised
concerns about whether the dividend earned
on the account and interest charged are Shariah
compliant.
Workshops
Lack of take-up of the workshops could be
attributed to:
• the difficult economic climate and fewer
parents starting work or considering work as
a realistic/immediate possibility;
• workshops being offered in areas without
existing services, for example, housing
estates with minimal presence from housing
association/other support staff to encourage
sign-up and offer credibility to the sessions; and
• funding cuts/public sector restructuring which
meant that some organisations were unable
to offer workshops because of changes to
their services, for example, Hillingdon Homes
and welfare to work organisations during the
changeover period from Flexible New Deal to
the Work Programme.
11
£250 paid to parents who sign off specified benefits after claiming them for at
least 26 weeks to start work lasting at least 5 weeks.

17Childcare Advance
As the only loans to be taken out were granted
after the project delivery period, the original aim of
this pilot project to make recommendations for a
national roll out of Childcare Advance loans is not
possible. Following the discussion points above,
recommendations are instead offered to inform
any future work focusing on the up-front costs of
childcare and to support the continued offer of
Childcare Advance loans by Hillingdon Credit Union.
A. Increase awareness and understanding
of the credit union.
The parent survey carried out for this project
revealed that one of the most important factors for
parents when borrowing money is that it is from an
organisation or person they trust. The same survey
also highlighted a lack of knowledge of credit
unions.
Greater awareness of Hillingdon Credit Union – and
more generally of how credit unions work –
is therefore essential for the successful promotion
of Childcare Advance loans. Wider promotion of the
credit union could also encourage parents to join
the credit union as savers which would give them
access to low interest credit when they need it.
B. More targeted promotion of the Childcare
Advance loan through employers and childcare
providers.
As outlined in section 6 of this report, the potential
delay between parents receiving information about
Childcare Advance loans and starting work could be
a barrier to taking out a loan. Reaching parents at
the point they are about to start work, would allow
the loan to be promoted most effectively. As the
most significant stakeholders when a parent starts
work, employers and childcare providers seem
well-placed to promote the loans.
Support through employers could continue to
be offered through the credit union where the
organisation offers membership to its employees.
The Childcare Advance scoping project told us
that childcare providers need to charge fees in
advance to manage their business so it is in both
their and parents’ interests to make the payment of
these fees as affordable as possible. Loans should
therefore be promoted through local childcare
provider networks so that they can signpost
interested parents to the credit union.
C. Up-front costs of childcare should be included
in broader support for parents to meet childcare
costs.
It is also essential that up-front childcare costs are
not forgotten in wider proposals for support for
parents with childcare costs, and Daycare Trust will
continue to raise the issue through consultation
responses, research and lobbying work.
For example, the new Universal Credit could be
designed to allow parents to draw down some
of their entitlement in advance of starting a job,
with the amount repaid in instalments. Under the
proposal made by the Social Market Foundation for
a National Childcare Contribution Scheme, it would
be possible for money to be drawn from parents’
accounts for up-front childcare costs as well as
ongoing costs.
7. Recommendations of the Hillingdon
Childcare Advance pilot project

Credit Unions
Credit Unions are financial institutions that are
owned by their members. They provide services,
such as financial advice, affordable loans and
ethical saving options. There are Credit Unions
operating all over the world and many operate on
a local basis.
1. Had you previously heard of Credit Unions?
p Yes, I had heard of them and I knew
what they did
p Yes, I had heard of them but I didn’t
know what they did
p No (If no, go to question 4)
2. Are you a member of a Credit Union?
p Yes (If yes, go to question 4)
p No
3. Why haven’t you joined a Credit Union?
(please tick all that apply)
p I don’t see the benefit in joining
p I don’t need the services of a credit union
p I’m not really sure what they do
p I already have a bank account
Other (please specify)...................................
Borrowing money
Childcare can be expensive and parents
sometimes have to pay up to four weeks fees
up-front. We would therefore like to ask you about
sources of help with your up-front childcare costs.
4. Would you consider borrowing money (from
any source, including family members) to pay
for the up-front costs of childcare?
p Yes
p No
p Don’t know/Not sure
5. From which of the following sources would
you get help to pay for up-front childcare
costs? (please tick all that apply)
p Family member
p Friend
p Bank loan/overdraft
p Credit card
p Payday loan
p Doorstep loan
p Credit union
p None- I would not borrow money to pay
up-front childcare costs
6. What is the most important thing you would
look for when borrowing money? (please tick
the three most important)
p Low interest rate
p It is from a person/organisation I trust
p There is a simple application process
p I know someone else that has borrowed
money from that source/person
p I can get the money quickly
p The person/organisation is flexible about
when I need to repay the loan
p I know the person/organisation will
understand if I have difficulty repaying
the loan
Appendix: Borrowing money to
pay for childcare survey

19Childcare Advance
7. Thinking about the things that would stop you borrowing money to pay up-front childcare fees,
please rate how strongly you agree with the following statements (1 = completely agree, 5 =
completely disagree).
I wouldn’t borrow money (from
any source) to pay up-front
childcare fees because...
(Completely
agree)
1 2 3 4
(Completely
disagree)
5
...borrowing money goes against
my personal values
p p p p p
...I don’t want to get into debt p p p p p
...I can use childcare (not provided
by a professional) that doesn’t
require up-front fees
p p p p p
...I can afford to pay up-front
childcare fees by without
borrowing money
p p p p p
I wouldn’t use a bank loan/overdraft/
credit card to pay up-front childcare
costs because...
(Completely
agree)
1 2 3 4
(Completely
disagree)
5
...I don’t want to have to pay back
any interest
p p p p p
...I don’t think a bank would lend me
money / I’ve been turned down for a
loan, overdraft or credit card before
p p p p p
...I don’t think a bank would be
flexible or understanding if I was
struggling to repay them
p p p p p
I wouldn’t borrow money from a
friend or family member to pay
up-front childcare costs because...
(Completely
agree)
1 2 3 4
(Completely
disagree)
5
...I feel it would be unfair to them p p p p p
...I don’t know anyone that would/
could lend me the money
p p p p p
8. What is the maximum amount of money you would consider borrowing to pay up-front
childcare costs?
From a professional lender such as a bank or credit union £.................................
From a friend or family member £.................................

Supported by
Daycare Trust is the national childcare charity, campaigning for quality,
accessible, affordable childcare for all and raising the voices of children,
parents and carers. We advise parents and carers, providers, employers,
trade unions and policymakers on childcare issues.
Established in 1986, Daycare Trust has seen its campaigning translate
into policy change, including the establishment of the national childcare
strategy. However, access to quality childcare services is still dependent
on where families live and on their income. Daycare Trust is uniquely
qualified to give a voice to parents facing a multiple range of challenges.
Please support our campaign for quality affordable childcare for all.
Daycare Trust
2nd Floor, 73-81 Southwark Bridge Road, London SE1 0NQ
Tel: 0845 872 6260
Fax: 020 7940 7515
Email: info@daycaretrust.org.uk
Web: www.daycaretrust.org.uk
March 2012
Daycare Trust is a registered charity: 327279 and a company limited by guarantee:
02063604 registered in England and Wales.
VAT registered: 830 9847 06. © All rights reserved Daycare Trust 2012

Childcare Advance Hillingdon Pilot project report 2012

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Childcare Advance Hillingdon Pilot project report 2012