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News - 5 March 2014

Childcare costs more than a mortgage

The annual report by the Family and Childcare Trust says that the average fees for one child in part-time nursery and another in an after-school club are £7,549 per year.

In contrast, the average annual UK mortgage costs an estimated £7,207 last year.

Full-time childcare costs are nearly two-thirds more - at £11,700 a year - than average mortgages, it adds.

The study is based on information gathered by the trust from local authority family or children's information services in England, Wales and Scotland; they also say that there has been a massive 27% rise in costs since 2009, while wages have remained static.

Lavinia Newman, founder of ABDS comments:
“All children in England, Scotland and Wales qualify for part-time free early education in the term after their third birthday. In England, they receive 570 free hours every year, but even with this help, some parents are contributing a substantial part of their income to childcare.”

The report said that the current system was not working for anyone. The Uk are second only to Switzerland as parents who contribute the most towards childcare.

Anand Shukla, chief executive at the Family and Childcare Trust, said: "When even part-time childcare costs outstrip the average mortgage for a family home - and many parents have to spend more than a quarter of their income on childcare - it's clear that our childcare system isn't fit for purpose.

However, Education and Childcare Minister Elizabeth Truss said the survey showed that costs in England had fallen for the first time in 12 years in line with her department's Early Years Parent Survey from earlier this year. The drop in England was about £15 over the past year.

Liz Bayram, chief executive of the Professional Association for Childcare and Early Years, said:
"In many other countries parents only ever pay a proportion of their childcare costs with government (and in some instances employers) contributing too.”

Lucy Powell, Labour's shadow minister for childcare and children, said: "Under David Cameron, childcare costs are soaring, adding pressure to family life and shutting parents out of work.

If you need any help and advice on Nursery Schools and or starting up a new business contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar to discuss how ABDS can help

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail: abds@netaccountants.net

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