Should the state help in providing childcare? “If you can’t pay for childcare yourself, then wait until you can. Why should the country pay? No one paid for me.” This is the view of many Australians, yet we never hear similar dismissals of state-funded schooling.

This attitude to childcare is driven by a false distinction between childcare and education. It is true that childcare policies are in part about looking after children to enable parents who want do work to do so. But should this be the pre-eminent goal of policy, as the recent Productivity Commission report implies?

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In the UK, perspectives have changed radically since 2004, driven by evidence on the value of early education. A Labour government introduced 15 hours of free nursery hours to all children from their third birthday. Fifteen hours was found to be most effective for improving child development for the general population, although children from disadvantaged families can benefit from more hours.

This was extended to two-year-olds for the 40% most deprived families by a Conservative-led government, because politicians of all hues have been convinced by the growing evidence of the impact of nursery care for a child’s life chances.

Primary school teachers have long been aware of this, as one teacher I spoke to put it: “Some children arrive at reception class having spent far too much time confined to home, glued to the television, and nurseries help prepare children for school.”

The effects are present for all children according to longitudinal research of 4,000 children in the UK. Access to quality pre-school from the age of two can boost educational and social development that is apparent from the start right through to the end of schooling.

The boost provided is greatest for the disadvantaged, but significant for middle class children as well. Similar evidence comes from Denmark, France, Germany, Norway and Switzerland.

The painful reality is that, by the start of school, it might already be too late. For example James Heckman, a Nobel prize-winning economist says: “Like it or not, the most important mental and behavioral patterns, once established, are difficult to change once children enter school.”

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The evidence is clear. This does not mean “formal” education should begin earlier, rather there should be state funding for play-based, nursery settings from the age of two, followed by a gentle transition into school.

In the UK and across northern Europe, this is an issue on which politicians, of left, centre and right, agree.

In the UK, the Conservative government has announced that the current 15 hours of free nursery provision is to be increased to 30 hours, largely to further boost women’s employment, and the policy is supported by Labour.

The Liberal Democrats want to go further and provide universal care for two-year-olds and, for the first time, to cover toddlers – from nine months to two years – if their parents are working.

The reason for this latter part is a different motivation. It is not driven by early years’ education, though it might have some benefit, particularly for children from disadvantaged families. Instead, it is about helping parents to work, because the costs of childcare can be too much to bear for many families.

There are good reasons that parents go back to work when they have children, even if it isn’t economically sensible for them to do so at first. Some think of the longer-term, and are actually losing money to work, so that options do not shut down in the future. Others think of their work lives, and think it will be best for them and their children.

This, of course, does not automatically justify state funding, but a powerful economic case can be made.

Using taxpayer money to help parents into work is not necessarily a drain on the treasury; rather it can lead to more revenue. A UK think tank has published a report suggesting that a 5% increase in maternal employment in the UK could be worth £750m (AU$1.6bn) annually in increased tax revenue and reduced benefit spending.

A stable high-quality early childhood education and care system should be regarded as part of the infrastructure for a country’s long-term economic and social development, to be developed in much the same way as the education system or roads.

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This view is increasingly holding sway among OECD countries.

The OECD report Starting Strong III begins:

A growing body of research recognises that early childhood education and care (ECEC) brings a wide range of benefits, for example, better child wellbeing and learning outcomes as a foundation for lifelong learning; more equitable child outcomes and reduction of poverty; increased intergenerational social mobility; more female labour market participation; increased fertility rates; and better social and economic development for the society at large.

Those countries that are planning for long-term economic growth are investing in early childhood education and care, because the jobs of the future will be for those with the most skills, and the foundations are laid early in life. China is an example of a country that has greatly increased its investment in this area.

An additional government incentive may be to increase female participation in the workforce to raise the productivity of the nation. For example, an EU report advises member states to remove disincentives to female labour force participation. It recommends the provision of childcare to at least 90% of children between three years old and mandatory school age and at least 33% of children under three years of age.

Australia has choices, and there are plenty of options.

Professor Edward Melhuish is presenting his research at the Early Start Conference, University of Wollongong, 28-30 September 2015.