In a political economy context characterized by welfare state retrenchment, family policy transformation is a prominent feature of social policy change in high-income countries. Childcare is a key element of this transformation, and its expansion has been championed to promote female employment, gender equality, the conciliation of paid and unpaid work, and the mitigation of the social reproduction crisis. This paper interprets critically this transformation in terms of a retrenchment of compensatory income support policies for families (e.g. family allowances, unemployment, income maintenance), the expansion of services and active programmes (e.g. childcare, active labour market programmes) and the increasing commodification of social reproduction. Accordingly, we suggest the existence of a double movement. Childcare expansion – together with the retrenchment of compensatory income support policies – appears to provide further incentives for mothers to more readily accept low salaries in a service-based economy. It serves also to liberate mothers partially from social reproduction tasks, and it fosters the overall shift toward a dual earner model. The first movement suggests family policy expansion to be another tool to foster neoliberal capitalism. The second movement, in contrast, indicates that family policy expansion is instrumental in supporting working parents with young children, and helps to meet increasing care costs in a more gender-friendly context. On the basis of our empirical data, the first movement seems to prevail over the second in a majority of high-income countries. Further, childcare usage is influenced by household income level in most countries; this magnifies the negative distributional effects of cutting compensatory income support policies. Family policy transformation in a context of welfare state retrenchment does not seem to significantly challenge long-standing class and gender inequalities, and, in the transition from the Fordist to the post-Fordist sexual contract, contributes in most countries to perpetrate these inequalities under new forms.