The Great Childcare Robbery: Wealth Extraction in the Dutch Welfare State

July 2014 saw the bankruptcy of the largest childcare provider in the Netherlands. As a recent add-on to the Dutch welfare state – according to the1990 Esping-Andersen template a hybrid of corporatism and social-democracy – the extension of state responsibility for childcare was from the start thoroughly inscribed by neoliberal logics, ie. subject to consolidation, privatization and new public management. While the Netherlands was a latecomer in this area and is still known for its large percentage of part-time female workers, since 2005 fiscal subsidies have given a large boost to the capacity in pre-school and after-school childcare. Strikingly, this has turned childcare into a rapidly growing sector, which because of its steady, state-guaranteed revenue streams has proved to be attractive to Anglo-American private equity firms. The most notable case was that of Providence Equity Partners which bought the ESTRO childcare group, with over 600 facilities throughout the Netherlands it is by far the largest childcare provider. When, after 2010, the tide turned due to austerity, ESTRO went from being the cash cow of US based private equity managing partners to a los making operation. In mid-2014 the owners of ESTRO used a fast track provision in Dutch bankruptcy law to reward the managers, sell the remainder of the company and cut their losses. In this paper, we present the story, follow the money through forensic accounting and suggest alternatives that could serve the ground the local economy.