Price of childcare costs now an ‘eyewatering’ £15k per year

Increased prices are ‘freezing parents out of work’ and gaps in availability are ‘leaving disadvantaged children at risk’, a charity has warned

(PA)

Childcare costs have risen by nearly 6 per cent over the past year, taking the average price of a full-time nursery place for a toddler under two to an “eyewatering” £14,836 per year, a new report says.

Coram, the children’s charity warned that the availability of places has also dropped. Fewer than one in five (18 per cent) local authorities in England report having enough childcare places for disabled children, down from 21 per cent.

High costs are “freezing parents out of work” and gaps in availability are “leaving disadvantaged children at risk of missing out”, according to the charity’s report.

The survey found the average price of a part-time childcare place (25 hours) a week for a child aged under two in a nursery is now £148.63 across Britain – and it is even higher in England (£150.89).

The report is based on surveys from local authorities in England, Scotland and Wales that were returned to the charity between November 2022 and February 2023. Overall, 191 local authorities returned data.

Only half of local authorities in England reported sufficient childcare places for children under two, compared to 57 per cent in 2022.

The survey also reveals that the number of local authorities in England who report having enough places for the universal 15 hours a week free childcare entitlement for three and four-year-olds has dropped,  from 79 per cent last year to 73 per cent this year.

The report calls the drop in sufficiency of early education entitlements “especially concerning”.

It says: “Early education holds the potential to narrow the achievement gap between disadvantaged children and their peers, and has since it was implemented – helping to achieve just that.

“At a time when this gap is widening, it is vital that every child is able to access the high quality education and care that sets them up to learn at school and beyond.”

As well as eye watering bills, parents are facing widening gaps in availability of the childcare they need

Megan Jarvie, head of Coram Family and Childcare

Ahead of next week’s Budget, the charity is calling on the government to reform the childcare system to ensure a place is guaranteed for every child who needs it and parents only pay what they can afford.

Megan Jarvie, head of Coram Family and Childcare, said: “The need for reform of the childcare system is urgent. As well as eye watering bills, parents are facing widening gaps in availability of the childcare they need.

“As the chancellor decides his budget, we urge him to recognise the value of investing in childcare – it is a wise investment, enabling parents to work and boosting the outcomes of young children.”

On Thursday, shadow education secretary Bridget Phillipson will say that reforming the childcare system would be her “first priority in government” if Labour wins the next general election.

In a speech to think tank Onward, Ms Phillipson will say that Labour will not spend taxpayers’ money on the Conservatives’ “jerry-built” system of free hours of childcare as an analysis by the party suggests the cost of childcare is more expensive now than before free hours of childcare were introduced.

Her speech comes as the National Day Nurseries Association (NDNA) has published new survey findings which show that 98.4% of nurseries in England say their funding rates do not cover delivery costs.

The NDNA survey, of 477 nurseries in England in January and February, found that 83 per cent of nurseries are expecting to make a loss or only break even.

Purnima Tanuk, chief executive of NDNA, said: “We will see more childcare providers struggling to survive once all the cost increases come on board in April.

“The Government must acknowledge the full extent of this crisis and begin to meaningfully support the early years sector before it’s too late.”

A government spokesperson said: “The number of childcare places available to families in England has remained broadly stable since 2015 and standards remain high, with 96 per cent of providers rated good or outstanding.

“We recognise that families and early years providers across the country are facing financial pressures, which is why we have spent more than £20 billion over the past five years to support families with the cost of childcare.

“This government has also doubled the entitlement for working parents of 3 and 4 year olds to 30 hours and introduced 15 free hours a week for disadvantaged two-year-olds.”