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Childcare costs becoming prohibitive

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The price of childcare has soared, according to a national survey of the cost of nurseries, childminders and after school clubs. The research was compiiled by the national childcare charity, Daycare Trust, and supported by Accor Childcare Vouchers. It suggests that there is only one childcare place for every seven children under eight in the UK, so demand far exceeds supply and is pushing up prices for parents.

Main findings
– the typical cost of a full-time nursery place for a child under two is £120 a week, more than £6,200 a year;
– in some parts of the country, particularly London and the south east, the cost of a nursery place is much higher – typically £149 a week in inner London or over £7,500 a year, with some parents paying much more;
– the typical cost of a full-time place with a childminder for a child under two is £113 a week;
– the typical cost for an after school club is £26 for 15 hours a week

The lack of provision for children under two and the lack of after school clubs are highlighted as the biggest problems facing parents. Parents pay three-quarters of the cost of childcare in the UK, with Government paying most of the rest plus a small contribution by employers. Working families on lower incomes who get help towards their childcare bill through the childcare tax credit still have to find 30% of the cost of childcare. The current average award through the childcare tax credit of £37.30 a week is less than a third of the typical cost of a nursery place.

At the same time, the vast majority of workless families get no help at all. Three million children live in families where there is no working adult but only 20,000 children can access services paid for by their local authority. Millions of children in workless families are therefore missing out on the benefits of childcare and early education and their parents are trapped in a low pay/no pay cycle. The Daycare Trust argues that Government policies to abolish child poverty will only succeed with much greater public investment in affordable childcare available to all families.

Stephen Burke, Director of Daycare Trust, said: "British parents face the highest childcare bills in Europe. Our latest survey shows why more and more families simply can’t afford to pay for quality childcare. Despite the investment made since the National Childcare Strategy was launched in 1998, parents still face a daily struggle to find – let alone pay for – quality childcare."

"As a result, children are missing out on learning and development opportunities and many parents are trapped in a low pay/no pay cycle. With a quarter of children growing up in workless families, childcare is key to tackling child poverty and helping parents to work, learn and boost family income. Childcare and out of school services are a public good, with great benefits for society as well as individual families. Childcare is a crucial part of the local community like schools and hospitals and needs much greater long term Government funding. The Government’s current review of childcare provides a great chance to create modern childcare services that meet the needs of all families in 21st century Britain. Without affordable childcare, many families will not achieve their full potential."

 

One Response

  1. Childcare costs, underestimates and tax
    I laugh (nervously) every time I read this research because it so underestimates the cost of childcare.

    I pay £831 per month for my eldest daughter and £1085 per month for my 7 month old son in a (fabulous) nursery in West London. This works out at about £22K per year in childcare costs – rather more than the £6-8K quoted by the Daycare Trust. And I know that my nursery is not the most expensive in the area.

    A nanny would cost £350/week net – approx £25K a year.

    Both of these costs come out of my net salary – leaving me a grand total of £67 per month take home pay after pension contributions have been removed. If the government would allow these costs to come out of my gross salary I would be left with approx £500.

    If my partner did not earn significantly more than me I could not afford to work – something I enjoy.

    Someone really needs to sort this whole thing out – for every working parent and those caught in the childcare cost/can’t afford to work trap.

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