Thanks to the wonderfully liberating concept of contraception, each and every woman (and, for that matter, man) chooses to have a child. I see absolutely no reason why the state should subsidise that choice. In a similar way, my parents have drummed into us from an early age that if we have children, we're on our own and cannot expect free childcare from them. It makes me really mad when I see people expecting so much of their own parents. Selfish selfish people.
The sooner people see having children as a privilage not a right, the better. If you can't afford to have a child, then you shouldn't have one. [For what its worth, if I had unlimited money, I would have six children. As I am not a millionaire, I will limit it at two. That said, if I had made different choices in life about my career, my housing and my hobbies, we could probably afford more.]
I suppose its all about what you believe the function of the state should be. should it be there just to pick up the pieces when capitalism goes wrong or should it play a much wider role and support all aspects of your life, whether or not you "need" it or not.
I worry too about the consequences of a move like this - if it encourages more people out to work, then it will be another upward pressure on house prices as many more of the middle class who previously would have made the logical decision to become a SAHP will suddenly find they can afford the larger garden and the fifth bedroom (to house the fourth child).
That said, I do believe that childcare in this country is ridiculously expensive. I can't work out the business model of a nursery, because there doesn't seem to be much money in it and the carers are definitely not that well paid.