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By Rachel Lawler

The cost of childcare has risen 7% in the past year, with lower income families hit hardest by the increase, according to a new report from the Family and Childcare Trust.

 

says that the average cost of childcare for a child aged under two is now £122 a week – up 7% from 2017 and £119 a week for a child aged two and above – up 6% from 2017.

 

Currently, families that receive state benefits can reclaim up to 85% of their childcare costs, depending on how much they earn. Parents need to pay these costs upfront before being reimbursed. Tax-free childcare, which is available to some working parents, offers parents a top-up on their nursery fees and can be paid directly to providers.

 

The cost of childcare is highest for the youngest children, particularly between the end of paid parental leave and when a child turns three, when there is the least financial support available to parents.

 

The government’s offer of 30-hours free childcare for children aged three and four was also highlighted as a potential concern, as only half of local authorities said they felt they had enough available places for working families in their area.

 

Ellen Broomé, chief executive at the Family and Childcare Trust, commented: “New government investment is welcome, but this year’s childcare price surge shows that without root and branch reform, many families will be left just treading water.

 

“The government needs to streamline the current hotchpotch of childcare support schemes. We need a simple and responsive childcare system that makes sure that every parent is better off working and childcare quality is high enough to boost children’s outcomes throughout life.”

 

Neil Leitch, chief executive of the Alliance, said: “Of course, as the Family and Childcare Trust rightly points out, it’s those families on the lowest incomes that are likely to be hit hardest by these price increases.

 

“This is simply not acceptable, especially in light of the government's continued emphasis on the need to support and improve social mobility. Add to this the fact that just half of all councils in England say they have enough 30-hour places to meet parental demand and it's clear that the government needs to go back to the drawing board on this policy.”