Childcare costs break £6k barrier - a rise of 33% over the course of this parliament

[KateMumsnet]

Hello all

A report by the Family and Childcare Trust has found that the annual cost of a childcare place has, for the first time, broken the £6,000 barrier, averaging £115.45 per week across Britain. This means that childcare costs have risen by an inflation-busting 33% over the course of this parliament, and that, for families on the lowest incomes, it no longer pays to work.

We'd love to know what you think. Are your childcare costs comparable? Have you found that childcare costs outweigh the benefits of working? Do share your thoughts and experiences below.

I'm guessing they pay more tax in Finland. Actually I would be up for that.

Why DOES the burden fall on women.

1. Women's work is less well paid.
2. Women tend to be the younger partner in a relationship (and hence are earning less when the decision comes).

The main reason I am working and DH is SAHP is that I had the higher earning potential. The main reason this is unusual is that women marry older men. If you want to be the breadwinner, then marry a younger partner!

Why should everyone elses taxes have to pay for childcare, if you cant afford a/the mortgage and children then you either have a smaller house/mortgage or don't have kids that the state has to suppliment

Ice that's a silly argument; if age was the overwhelming factor in salary, then people close to retirement, no matter what their job, would be loaded.

As it is, gender is more of a factor, same as it ever was.

I'm in London and have been paying circa £14k childcare per year for 6 years! It's just gone down to £160pw now DD2 is in nursery full time. If I need a weeks cover for half term (ie this week) it is £300 for the 2 of them.

I'm a single parent and largely because of these costs we still live in a small one bed flat. it's been tough.

somewhere But it's never as simple as that, is it? Aside from children just sometimes happening, or circumstances changing, I don't think people are demanding that the state supplement their children. It's not wrong to think that childcare in order to enable parents to keep working - which is what government wants - and also is to the preference of many parents who want to keep working, should also be relatively affordable. This thread demonstrates a lot of people making the sacrifices and doing what needs be to pay for childcare. However it's not unreasonable to also want it to be more affordable, given how high it is in relation to wages. Just like we would like housing, fuel and food to be affordable relative to the means of the average person, it is reasonable to want childcare to be so too given it is essential for parents to remain in the workforce. Value (economy-wise) is gained for the nation if parents can work and pay childcare - 2 wages (more or less) are earned, that of the parent/s and that of the childcare provider, which also means less or no state support to them both, and the generation of more value in the economy (skills, purchases etc). The government wants all of this but at the moment it comes at great cost and leads to many parents reducing hours or leaving the workforce, and sometimes also becoming more dependent on state support.

How often is 'work does not pay' a code-word for 'don't fancy staying in crappy job without rewards to show for it, I'd rather stay at home with kids?' I know there are a lot of household who would really struggle on one income, and that some companies refuse part-time, but I know also households who would go by.

I admit we pay nanny (and 20% taxes and NI etc on top of her net pay and bonus) - as part-time nurseries in London aren't that much cheaper and a LOT less inconvenient where I am, so literally all my pay goes on nanny. But I never thought about giving up work to stay at home because it did not pay. It's still good for my career long term. Skilled jobs won't be eagerly waiting for me with open arms when I try and get back after 5 years gap or so when childcare gets cheaper with older children or in case I get widowed.

We don't have a car and holidays etc but we are happier with the balance in life than I'd have if I became fulltime sahm without career (and then struggle to get back) and without knowing someone else wonderful who gets paid (far more than nursery workers and teachers).

I agree though that work needs rewards to show for it than just a net £ sum, esp if you're going to be away from children.

Two points.

1. Parents of multiples should get special consideration when buying childcare vouchers. Two teacher friends have had twins and both have been sahm because they couldn't afford to return to work. The upper limit of £243 should be changed for them.
2. The 15 hours free care for 3_5 year olds should be flexible and moveable. My son does 1 1/2 days at nursery but we still pay a sizeable amount because some time blocks are free and others are payable. I'd like to be able to compress my hours together.

hyper Work does not pay for me is a simple equation. The cost of me working is greater than the income I bring in. It therefore doesn't make sense for me to be in working job outside of the home.

I am about to leave the workforce for 18-24 months because even as a qualified accountant with mid level of experience, my wages are not enough to support 2 DC in daycare plus make sure my son gets the attention he needs given his speech delay. I would love to send him to the specialized childcare center but at $2200 a month for him alone plus $800 for DD I would have to work FT to cover costs. DH makes more than enough and as an accountant in public there is a perpetual shortage of people at my level so I have no qualms about leaving. I expect I will be able to walk back into my current role once my DC are that little bit older. If I don't return to my current employer I will set up my own business.

As it stands I am not on Partner track and my goal is to look at making Director. I like my job and think I am pretty good at it given the one level ratings for the past 3 years I have worked at big4 (which are like gold dust).

honey I totally agree with ice. DH is 4 years older than me and makes way more than me. He started work at 17 and has worked for the same employer for 20 years now. His studies have all been part time and completed while working. I have 10 years of experience so it is of hardly any surprise that I make less than him.

If you look around you at work you rarely see upper management under the age of 30. You need experience to be in management. If you look at lower paid jobs, the supervisors in the supermarket are more experienced than those working under them and they are paid more based on their responsibilities that they are able to perform because of this extra experience.

I'm going to trot out a well-worn response to 'work doesn't pay' - women living with DP/DH should stop looking at their salaries to fund childcare, it should be a household cost in the same way rent/mortgage is. The DC belong to both, so the cost burden for childcare should fall on both.

In countries where unemployment is low and taxation is high ( finland ,Sweden etc ) childcare Costs are low, because the government have enough money to finance it.
Here we have high unemployment and taxation is actually very low.
The cost of living is quite high, so ...
People who care for children e.g the child carers have to make a living as do we all. This is why childcare is costly. Nurseries pay high costs for premises , insurance , wages, food, loo paper etc the list is long. Nannies and childminders have to make enough money to live on, they have families to feed too. The more highly qualified the nanny/ childminder the more they charge obviously .
Often expect childminders to be like early years teachers these days. The paper work is immense not to mention the mess and wear and tear on their home.
Every parent has a choice . There is a choice where you live. If you choose to live in London costs are going to be higher.
Alternatively, stay at home, invest your time in your own children caring for them yourself. Stop complaing . Childcare shouldn't be cheep . ??

What would people think about a kind of student loan for childcare fees? I pay my student loan back at 9% of salary over £Xk. Would doing something similar for parents be an option do you think?

That would allow all parents who wanted to to stay in employment and continue to further their career?

I pay 48 per day, midlands. The account it's meant to be 25 hours per week, so on my rate would be £120 weekly, so based on 51 weeks is about right according to the 'average'

I have just worked out the costs of childcare to cover my three children before and after school plus holiday club from September when the youngest goes to school (so no nursery fees). I work three days a week, and it will go down to £5200.

China I could see how your suggestion may work for some people, personally I'd hate this. I can't put my finger on why either

£45 per day plus paid holidays (childminder) for a 4 day week. £9360 per annum. She's fab and worth it but a second child might break us.

It's an interesting idea China, not something I've heard suggested before. I think it would be something I'd consider doing myself, but then I'm not still paying off a student debt. Aren't today's students going to paying off their loans into their forties? It might be a bit much to add another loan for £15k p.a. (our FT nursery costs) for four years to that...

^Every parent has a choice . There is a choice where you live. If you choose to live in London costs are going to be higher.
Alternatively, stay at home, invest your time in your own children caring for them yourself. Stop complaing . Childcare shouldn't be cheep .^

There is not much point in delving into this but it is common knowledge that it is not just as simple as moving out of London, or anywhere for that matter, especially if your work and/or accommodation are rooted where you are now. Plus London is not meant to be a child-free zone and it is not supposed to reserved solely for wealthy families.

Additionally "investing your time" may not make sense for many. Let's say a couple both earn £25k and take home c. £20k each. Their annual childcare costs are c. £10k (using an estimate based on quoted childcare costs upthread). So they take home £10k less than they did pre-DC, but if one stayed home or they both went PT to have a parent at home every day then they would be (very roughly) £20k down. It's highly likely that it wouldn't be feasible to do that. They also may only be able to afford to stay home by receiving benefits, if as a household they would be eligible (which I think they would be entitled to some with a household income of £25k pre-tax), which the government doesn't exactly want to encourage.

No one is saying childcare should be cheap. Just that it should be reasonable when it is in the interests of many for parents to be able to work full time. As I said upthread, if you have 2 parents in work that are paying for childcare, there are roughly 3 wages being paid which means 3 lots of tax, NI, 3 people in employment and therefore not wholly (or possibly not at all) dependent on state benefits, 3 lots of income that can then contribute in the form of purchases, plus 3 people who are maintaining and developing skills and potentially have routes for progression, and so on. It is therefore in the wider interest for parents to be able to both work and afford childcare. The alternative is not wrong and if people want to stay at home then that is just as valid, but if people are staying at home because they feel that they can't work - or even, childcare costs would meet or exceed their wage and therefore not be sustainable for their family - then that just doesn't make sense.

The opportunity to work and pay for childcare shouldn't be treated like some sort of luxury, and the decision to have a child shouldn't be treated as merely a luxury either. It is quite common to want to have a child and many parents struggling with childcare costs are people with decent salaries, it would be hard for many to reach a point where childcare becomes a comfortable expenditure in time to actually have children.

IpsyUpsyDaisyDo - thinking of childcare costs as a household expense doesn't change the reality for some families - that they are worse off with both parents working. More frequently it is the woman who is in a lower paid role, so stops working.

What % of women have managed to get a part time job?
Certainty my application was rejected, and so I pay full time childcare - but in a very cheep part of the country, making it a meer 8k a year!
The bit that has shocked me is actually how much before and after school, along with 1/3 of the school holidays (DH and I split most of our AL), still comes in around 4k/year.

While putting 2 kids in FT nursery, with just one on 12hr/week (when averaged over 52 weeks of the year) EYF, I basically worked for petrol money, a pension and an occasional coffee, but now were on 1 at school, and another due to start in Sept, we are really starting to see the benefits of pay rises (yes, we've had some - again luck with the industries we are in) and reduction in childcare.

Fitting in homework is really hard tho.

But from a thread on here at the moment, we also need to consider emergancy childcare, and childcare outside 8-6 Mon-Fri, as ill kids, weekend/ shift or late working, when people are som mobile seems to be a big sticking point.

Whats all this about 33% rise in 5 yrs tho? Where has that money gone? A small increase in NMW, and bigger gas / elec prices, but I can't account for that much increase???

Yes, I can see that people may not want to be saddled with debt but given many complain of lack of earnings potential etc it could be a solution for many. I might propose it when the politicians start knocking at the door next month.

My partner works one day at the wknd so has a day off in the week. We still spend 11,500 per year on childcare for our DD age 2.6. How I'd love to have another child but the cost of childcare makes it totally unaffordable. If you are one of the lucky few who have a family nearby to support you and to help then lucky you, but there is totally nothing realistic about the total given, 6000 p/a??? Yeah right!!!

why should childcare be cheap.?

we pay £47/day for childcare, in the North West. We use 3 days, but a full-time place would be in excess of £12k.

At the moment only DD2 is at nursery. there was a brief period between the end of my second maternity leave, before dd1 started school, when I had 2 at nursery. For those few months, every penny I earned went on childcare. Luckily for me this was a very limited period, but no way could we have sustained that for more than a couple of months.