Low-income families and working women are being priced out of nurseries and forced out of their jobs as childcare costs rise twice as fast as wages.
A survey by the Daycare Trust, the national childcare charity, found that while pay rose 2.1% over the past year, the cost of a nursery place for a child aged two or over increased by 4.8%.
London and the south-east saw the biggest price rises but the most expensive nursery in the survey was in the West Midlands charging £11 an hour. Parents needing 50 hours of childcare provision every week could pay more than £28,000 a year.
The increase in costs come as parents already struggling with rising prices and flat wages are faced with cuts to Sure Start centre funding and reductions in tax credit and child benefit payments.
Parents of young children now face an average annual bill of £5,028 for 25 hours of nursery care a week in England rising to as high as £6,164 in London. In the north-east, parents pay an average of £82.70 a week or £4,300 a year.
Anand Shukla, acting chief executive of the Daycare Trust, said: “When parents sit down to calculate their family finances and see childcare costs increasing far faster than their wages, it is no wonder they may think twice about the economic sense of staying in work. These high, rapidly rising costs are particularly significant given the number of people not receiving cost-of-living pay increases this year, the increase in VAT and rising costs of other household goods, particularly food and fuel.”
Shukla went on to say that the planned changes to tax credits and other benefits will mean that some families will be forced to find an extra £546 a year to cover their childcare bill: “Yet parents in the UK already spend an average of one third of their net income on childcare costs – more than in any other OECD country.”
Veronique Boisvert, a working mother with two children aged four and one, told the Independent: “Our childminder ups her prices every six months. They are all very expensive in our neighbourhood so we can’t shop around easily. We are at her mercy when it comes to price, yet we’re also dependent on her.
“Our income is above the threshold for tax credits, but we are not so rich that it doesn’t matter. Our monthly income does not cover all our expenses. We have some savings, but that isn’t a sustainable situation if the costs do not stabilise.”
Ryan Shorthouse, of the Social Market Foundation thinktank, said: “An increasingly qualified workforce has pushed costs for nurseries upwards, as has a focus on attracting even younger children, which require higher child to staff ratios. Parents also increasingly start their children’s schooling earlier and maintained nurseries attached to schools become more popular. At the same time, funding from local authorities has often been insubstantial. The result is rising costs.”
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