Discourses within the UK Labour government's welfare policy agenda have consistently featured a reformulation of programmatic governance away from both centralised hierarchies and neo-liberal markets to a social policy strategy that highlights a commitment to inclusive partnership working. Significantly, this process of meaningful social engagement and empowerment is intended to be facilitated and sustained through the building and deployment of social capital. This article reports data from a three-year ethnographic study into the experiences of parents and professionals involved with the implementation of a "Sure Start" multi-agency health and education early years programme driven by these policy imperatives. Significantly, whereas previously published research from this study revealed the building of social capital, the findings presented in this article suggest with the policy shift to Children's Centres the social capital engendered to be in danger of erosion. In the concluding discussion, the article highlights the shifting dimensions of power at national, local and team levels informing this process of erosion, to suggest that social capital may be destroyed much more readily than it can be built. (Contains 5 notes.)