Parents Pay Inflation-Busting Cost Of Childcare

 

27 January 2005 - The cost of childcare continues to rise well above the rate of inflation, at a time when parents are reporting continued difficulty in finding quality affordable places for their children, so says a study released today by Daycare Trust, the national childcare campaign, with the support of Sodexho Pass.

London and the South East continue to be hit hardest by the inflation-busting rise in prices, with inner London boroughs seeing nursery place costs soar by more than 17%, keeping them the highest in the country; typically £197 for a week’s nursery care for a child under the age of two. The Survey found that some parents in Inner London are currently paying £350 for a week’s full-time nursery care.

The average rise in costs to parents of nursery places is 5.2% - three and a quarter times the rate of inflation. This leaves the typical cost of a nursery place for a child under the age of two years up to £141 a week, from £134 last year. For a child aged over two years, the typical cost in England is £132, a 7.3% rise from £123 last year.

Daycare Trust’s annual survey of the cost of childcare supported by Sodexho Pass, profiles the costs parents can expect to pay for nursery places, childminders and out of school clubs. This year, for the first time, the Survey also includes figures from Scotland and Wales. A nursery place for an under-two year-old is typically £122 in Scotland and £120 in Wales; while for over-twos, typically £117 and £115 respectively.

The cost of childminders is highest in the South East region, typically £157 for a child under two, full time, for a week, and £154 for a child over the age of two. Nationally those figures are £127 and £126 respectively, reflecting a 5% rise since 2004.

The costs of out of school clubs are also profiled. Nationally, based on a 15-hour week, such clubs typically cost parents £45, but in the East of England region the rate is almost 50% higher, at £60 a week.

Almost all areas of the country reported a rise in the costs parents have to pay for all forms of childcare, when they can find it. The least expensive region in the UK for childcare costs is the West Midlands, with figures below national averages, despite increases across the board of more than 5%.

As part of the Survey, Daycare Trust also asked local Childcare Information Services whether parents were reporting a lack of affordable, quality childcare in their area. A massive 65% confirmed this to be a problem.

This Survey’s findings come at a time of change for childcare, with the unveiling last year of the Government’s 10-Year Childcare Strategy. Daycare Trust will be at the forefront of working with Government, local authorities, parents and childcare providers to ensure that the vision of universal, affordable, quality childcare now championed by ministers is delivered. This Survey’s findings again demonstrate how crucial that work now is as the challenges facing parents as they seek to care for their children are laid out in harsh economic terms.

	Nursery under 2 £	Nursery 2 and over £	Highest nursery cost	Childminder under 2 £	Childminder 2 + £	Out-Of-School Club £
Inner London	197	175	350	142	146	29
Outer London	170	147	260	151	150	38
South East	162	155	300	157	154	36
South West	141	132	275	132	132	37
East Of England	148	134	250	134	131	60
West Midlands	114	112	181	106	106	40
East Midlands	118	116	185	119	119	57
Yorks & Humb	124	116	175	114	114	149
North West	118	114	187.5	98	97	42
North East	119	114	189.25	114	114	51
England Average	141	132		127	126	45
Scotland	122	117	175	126	124	43
Wales	120	115	155	120	119	32
GB Average	138	129		126	125	43

The figures were compiled from a survey of 137 out of 200 Children's and Childcare Information Services in Great Britain

Stephen Burke, Director of Daycare Trust, said:
“The findings of this survey may make grim reading for some, but parents across the UK already know too well the inflating cost of childcare. While the steps indicated by the Government in their 10-Year Strategy are welcome, parents of children right now need more access to affordable, quality childcare to suit their needs.

“Our survey shows that the majority have difficulty finding the right childcare that is affordable. While the Government is bringing in extended help from April, in the form of larger tax credits and exemptions from tax and NI on Childcare Vouchers, to help with the costs, availability is still a huge issue. To make childcare available to all there must be significant investment in the childcare workforce, both to ensure there are enough staff and to ensure that they are trained to the highest standards to care for our children.”

Nancy Weeden, Childcare Service Manager for Sodexho Pass, adds:
“It is pleasing to see the issue of childcare so high on the political agenda. The good news is that from April 2005, childcare vouchers up to £50 per week become both tax- and NI-exempt. For the first time employers have a chance to implement a family-friendly policy that will make a real financial difference to all employees who pay to have their children looked after while they work. The savings an employee can make will be significant – as much as £1,066 a year.

“Employees will understandably want to take advantage of what’s on offer and in view of this I cannot emphasize strongly enough the need for all employers of whatever size to familiarise themselves with the new legislation now – in order to be ready to cope with employee demand for the new benefit in April”

Bronwen Cohen, chief executive of Children in Scotland, the national agency for all those working for children and their families, said:
“Continuing high costs of childcare highlight the need to subsidise services more effectively. Entitlement to early years services beyond compulsory schooling in Scotland is limited to free part-time early education for three and four-year-olds, which means many parents still struggle to access affordable, high quality childcare.

“The Scottish Executive should look to countries such as Sweden, which offers generous parental leave entitlements and the universal right to accessible and affordable services for all children from the age of one."

In response to the Daycare Trust's findings Irene Audain, Chief Executive of the Scottish Out of School Care Network said:
"Childcare costs are increasing right across the country and parents have limited childcare options yet the idea behind tax credits was precisely to give parents choice in a childcare "market". This is not working, as there is precious little choice in many parts of the country- a situation common to both Scotland and England.

"Ongoing long-term commitment to invest in the supply side of children for all is working in other European countries. The government needs to support affordable quality childcare which is provided locally through the voluntary, public and independent sectors, and meets the requirements of parents.

"Childcare should be available to everyone and not be a source of worry or concern- parents shouldn't have to struggle to find childcare or give up employment or training opportunities in order to meet their childcare needs, the reality for many parents.”

Lynne Hill, Policy Director for Children in Wales, said:
“Children in Wales would like to see all families who wish to use childcare outside the home, basing their choice on the best option rather than the affordable option"

NOTES TO EDITORS
1. The CPI inflation rate as of December 2004, is 1.6%
2. The Government published its 10-year plan for childcare in December. From April this year employees will be entitled to receive £50 a week of childcare support, such as childcare vouchers, from their employer free of tax and national insurance contributions (provided their employer provides such benefits).
3. The maximum childcare costs parents can claim assistance with through the childcare element of the Working Tax Credit will increase from £135 to £175 a week for one child, and from £200 to £300 a week for two or more children. They can claim 70% of the costs back.
4. From April 2006, parents will be able to claim 80% of their childcare costs back up to the new threshold.
5. The Government is working with the Greater London Authority to improve the availability and affordability of childcare in London through a range of pilot schemes that will benefit more than 10,000 families in the capital.

Daycare Trust is the national childcare charity, campaigning for quality affordable accessible childcare for all and raising the voices of children, parents and carers. We advise parents and carers, providers, employers, trade unions and policymakers on childcare issues. We recognise that everyone is unique and we value difference in our communities. We listen to all views and are committed to act without prejudice. We oppose all discrimination and promote equality in all we do.

Daycare Trust runs a childcare helpline (020 7840 3350) for parents with access to Language Line interpreters for non-English speakers, open for calls Monday to Friday, 10am to 5pm. Callers can get a free copy of Daycare Trust’s ‘Choosing Childcare: Your Sure Start Guide to Childcare and Early Education’, and a tax credit calculator, to find out how much tax credit parents may be eligible for towards the costs of childcare. Parents can also visit www.daycaretrust.org.uk for information.

Sodexho Pass is an expert in the field of voucher provision operating in 27 countries globally. In the UK Sodexho Pass run childcare voucher schemes for both private and public bodies across all industry sectors. Sodexho Pass offer two childcare voucher services - Childcarepass and the newly launched Childcare Choice aimed at small to medium sized enterprises. Voucher schemes are available in paper, electronic and dual system formats.

For further information, contact press office at Daycare Trust on 020 7840 3350, ext 237.