Childcare costs outstrip wages

Childcare costs outstrip wages

According to the TUC, childcare fees for working parents have risen three times faster than wages in the past decade. Analysis done by the TUC has found that costs have gone up by 52% per week since 2008 for families with a full-time and a part-time working parent, despite government initiatives. The earnings of these parents have increased by 17%. The research found that lone parents were faring worse, with childcare costs for a single mother or father working full-time having risen seven times faster than earnings.

On average, childcare in England for a child under the age of 2 at nursery is £236 a week, with costs for a child over the age of two being £232 a week. This is compared to prices from 2008, when it was £159 a week and £149 a week respectively.

The TUC have said that the West Midlands was the area where nursery fees for families with a full-time and a part-time working parent had outstripped wages the most, followed by the south-east and the north-east. Examples of bills included £4,700 a year paid by a family on average earnings, with one parent working full-time and another part-time, for a three-year-old and a one-year-old child. A single parent on average earnings, working full-time, was paying just over £6,000 for the same coverage. In light of this, there have been a number of recommendations made by the TUC including subsidised childcare that would start as soon as maternity leave finishes, as well as more government funding for local authorities to provide nurseries and childcare. It also called for a greater role for employers in funding childcare and an increase to childcare support provided by tax credits and universal credit.

Currently, the government offers 30 free hours at nursery for three and four-year-olds, although reports have shown that nurseries have long complained that the hourly rates paid by the government are too low. Last year, a tax-free childcare initiative launched, designed to replace the voucher system by giving eligible families up to £2,000 free per child towards costs. However, with the cost of childcare increasing, these vouchers are not stretching far enough for many families.

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