Hi @Allthenameshavegone1972 sorry to hear they're struggling. I've been in a similar situation (bar having a child at the time), so can give some input from how it was for us and what we did to sort it.
Before we were married, my husband and I wanted to get our own place to make sure we could live together well. We'd been together two years, but I was a shift worker and living at home so I could try to save. I didn't earn a lot, so wasn't saving much, but I tried. My partner was renting a single room in a house share, so also not saving a huge amount. Neither of us were on high wages.
When Covid happened, we both moved in with my mum and saved like mad. We both contributed to rent, bills and food, but at a significantly reduced rate. I was only just over minimum wage at the time, but I managed to save £10k in three years by living at home, and so did my partner. I was still a shift worker and paying almost £500 per month in commute costs on a low salary.
We moved into rented accommodation after a year and a half with my mum, and went from paying £400 a month (all inclusive of rent, bills, food, fuel, etc) to £1200 (£650 a month each) and that was just rent. It was a big adjustment, and our lifestyle had to change. We looked at every single expense we had, and cut back everything possible. We then made a strict spending plan and had to stick to it. This included having only one car between us, me changing jobs so I could work from home some days and save commute costs, managing shopping budgets, very strict 'fun money' allocation (days out, eating out, take aways, ordering stuff on Amazon, hobbies, etc.), and we also shopped around for the cheapest deals for internet, energy bills, phone contracts, etc. We both went down to sim only and both of us have paid £10 each for the last four years.
By making these changes, we managed to pay our rent and bills, plus save enough to get married and buy a house by the next year. This was literally when the housing market crashed too, so it wasn't by any means easy. We now pay £1300 mortgage for a small house with a rate of 4%, which is only £100 more than our rent was, and that was the cheapest rent around we could find at the time.
Something isn't adding up with income vs outgoings. I'm not saying they're hiding things per se, it may be that they just really need some help putting it all straight and into perspective. They can't rely on you and their PiL their whole lives to dig them out, so better to sit down with them now and have it all on the table.
What subscriptions do they have? How much are they spending on leisure, hobbies or online? Do they budget carefully for Christmas and birthdays? How often are they buying clothing, shoes, accessories, uniform and school bits for DD on top of bits for themselves? All of those things need to be talked about and taken into account. You need to know exactly how much each of them are paid and then work out a non-negotiable budget with them that allows everything to be paid and then whatever is left split between necessary spends and savings. If there's no fun money left, there's no fun money left. If they only have £100 left at the end of the month and they feel they need more, then they need to cut something else back to make it more. They're never going to save if they can get easy help from family.
I was also in the same boat as your daughter regarding credit score. I had no debt, but I'd never had a credit card and I'd been living at home, so my names weren't on the bills. In 2020, I opened a very basic credit card and put any small spends on it initially until I was comfortable using it. Then, when we moved, I put larger ones on such as an item of furniture or household products we needed, and I paid it off the moment my wages came in so I never incurred any interest. I also started paying household bills from my bank accounts. My credit score went from something like 600 to 900 in two years.
It really could be they're living beyond their means. It's very hard not to these days when everyone has things we want to keep up with or access to nice things like Netflix, Disney+, phone upgrades, decent cars etc. but if they can't pay their rent and bills for themselves, then they can't have non-essentials. It's simple as that. It needs to be that way or they won't ever save anything or have any financial stability.
It may also be that they are being sensible and they just don't know what else to cut back or chop and change, and that's where some help comes in. Reiterate that you're always willing to help them, but that doesn't mean paying their rent of them every time they've spent too much or haven't budgeted well enough.
If they need to move back in with the in laws then so be it, that's fine, but if they do they need to be made aware they are there to save, not spend, and they need to have saved XYZ (a reachable and reasonable amount for them) within a period of time or they will have to rent again.