Karin Smyth, MP for Bristol South, has called on the Government to breakdown the barriers of opportunity by ‘getting a grip’ of rising childcare costs.
The Government is knowingly underfunding the 15 and 30hrs childcare entitlements by over £2/hr. This is forcing providers to cross-subsidise leading to astronomical costs to parents paying for additional hours.
The cost of a fulltime nursery place for a child under two has risen by approximate £1,500 over the last five years. Moreover, unstable funding and rising costs have forced over 5,400 childcare providers to close between August 2021 and 2022.
Polling shows that 76% of mothers who pay for childcare, say it no longer makes financial sense for them to work. In addition, 1 in 4 parents (26%) who use formal childcare, say that the cost is now more than 75% of their take home pay.
Figures show that an estimated 1.7 million women are prevented from taking on more hours of paid work due to childcare issues, resulting in up to £28.2bn economic output lost every year.
According to the IFS, government funding is not keeping-up with rising costs, meaning total funding for the free entitlement will be 8% lower in real terms in 2024–25 than it is this year.
Karin Smyth, MP for Bristol South, said:
“The Government needs to desperately get a grip of the astronomical childcare costs facing families. We now live with the fact that the cost of a fulltime nursery place for a child under two has risen by approximately £1,500 over the last five years meaning families are having to make horrendous decisions on how to fund childcare.
“We know that women end up having to provide the majority of care in society. Be it for elderly relatives or children and this holds them back from being able to take part fully in the economy. The Government’s actions have compounded this fact meaning 1.7 million women are prevented from taking on more hours of paid work.
“It is time for a modern childcare system that supports women from the end of parental leave to the end of primary school. Labour has a plan to do just this. We will start with breakfast clubs for every primary school child in England, enabling parents to get to work, save money and boost children’s learning and development. This will be funded by closing the non-domicile tax status.”