This is the first annual childcare cost survey conducted since Childcare Sufficiency Assessments have been completed in England and Wales.
The figures are compiled from a survey of local authorities with responses from 136 out of 200 Family Information Services (FIS) in England, Scotland and Wales (68 per cent response rate), based on 50 hours a week in a nursery and 15 hours a week at an out-of school club.
Key findings:
- The yearly cost of a typical nursery place for a child under two is now £8,684 in England, £8,216 in Scotland and £7,592 in Wales.
- A typical full-time nursery place for a child under two is now £167 per week compared with average earnings of £479 per week. Costs have increased by 5 per cent in the past twelve months, whereas inflation currently stands at 3.1 per cent.
- The highest childcare costs were found to be in London and the South East where typical costs ranged from £173 to £226 a week. Parents paying the highest reported costs could be paying as much as £400 a week or £20,800 a year.
- The cost of an out-of-school club place has declined by 7 per cent over the year. Several local authorities - particularly those in London - indicated that they offered subsidised out-of-school places in certain circumstances, such as for disadvantaged children.
- 69% of FIS's said that parents had reported a lack of childcare in their area over the past year; 59% of FIS's reported insufficient childcare in their area for over 12s; 56% reported insufficient childcare for disabled children and children with special education needs, and worrying 27% reported insufficient childcare for under 5's on whom the Government have targeted funding.
Daycare Trust joint chief executive Emma Knights said:
"Yet again the cost of nursery places has increased above inflation, making pre-school education a big drain on family budgets at a time of financial uncertainty.
"It is encouraging that the cost of out of school care has gone down in England and we hope this reduction will be repeated in future years, but increases in Scotland and Wales are a cause for concern.
"It is crucial that parents claim all the help they are entitled to, and that the Government increase the free childcare entitlement to include all two years olds. The current review of tax credits should increase the maximum proportion of childcare costs the poorest parents can claim from 80% to 100%.
"Also many parents are still reporting a lack of suitable childcare in their neighbourhood, particularly for disabled children and children in secondary school, which is especially worrying in light of recent changes to lone parent benefits.
"We hope the Government will take account of the policy recommendations in this report publish their refreshed childcare strategy so that all parents have access to high quality, affordable childcare."
Policy recommendations:
- Increase provision of out-of-school childcare, given the growing number of working parents and especially given their increased importance within the Government's welfare reform programme. This will require sustained subsidy to ensure all parents are able to access such care.
- Provide subsidised out-of-school activities for all 11-14s and for younger children from poorer families, aiming ultimately to make them free.
- Increase the proportion of help with childcare costs through tax credits from the current 80 per cent to 100 per cent; increase the maximum levels that can be claimed by region to accommodate childcare costs in high cost areas - particularly London and the South East.
- Continue to encourage take up of the childcare element of Working Tax Credit through providing more information to families with children on their entitlement.
- Tackle the affordability crisis by giving local authorities the means to develop sustainable services in poorer areas and provide free places for those missing out, including places for disabled children, parents needing out of hours care, Further Education students and parents of under-threes who want to train.
