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Is there sufficient childcare in your area for parents who work outside normal office hours?
58% of parents struggle to meet up-front childcare costs.
NEWS RELEASE
NO EMBARGO
CONTACT: DAYCARE TRUST PRESS OFFICE, 020 7840 3350, OUT OF HOURS 07736 311 082
58% of parents struggle to meet up-front childcare costs.
Daycare Trust have this week published ‘Childcare Advance', a report on how parents can be helped to meet the up-front costs of paying for childcare, funded and supported by Friends Provident. The Association of British Credit Unions provided assistance with the financial modelling in the report.
When starting with a new childcare provider, many parents are required to pay up-front fees to secure a place - or in some cases, simply to get onto a waiting list. These costs include advance fees, deposits, retainers and administration fees - either individually or in combination. With typical weekly childcare costs currently £167 per week, four weeks' fees in advance would mean that parents had to pay £668 when they took up a place. As many people start using childcare when they start work, this money often has to be found by parents who haven't been working and so have no savings. Not surprisingly, raising this lump sum creates a barrier to parents returning to work.
Following a glut of calls to our Information Line about the problem of up front childcare costs, Daycare Trust surveyed 202 parents' views, which were collected through an online and paper survey and follow-up telephone interviews with selected respondents.
We found that:
- 58 per cent of parents who responded to the survey said that they found it difficult to meet up-front childcare costs.
- Families with a household income of less than £40,000 were most likely to report having difficulties meeting the up-front costs of childcare.
- Median up-front costs reported across all income groups were £300-500, with fees in advance being the most commonly reported cost.
- Families with a household income of less than £18,000 were most likely to seek help to pay these costs.
- Overall, 21 per cent of respondents reported that upfront childcare costs affected their decision to return to work; more parents in couples than lone parents reported this.
To tackle the problem of up-front costs, Daycare Trust are recommending that the Government pilot a ‘Childcare Advance' program which would offer interest free loans to parents within the most affected income brackets to cover the short term costs of up-front fees, but not long term childcare costs.
‘Childcare Advance' would:
- Be open to families with a household income (including benefits) of up to £40,000 per year;
- Meet the costs of fees in advance, but not deposits;
- Pay up 4 weeks' fees in advance per child; and
- Be offered as a low interest/interest-free loan.
Emma Knights, Joint Chief Executive of Daycare Trust said:
"The Government want parents to take up childcare so that they can return to work, maximizing their household income and also give their children a high quality early years experience. Up-front fees for childcare are a clear barrier for parents on even modest incomes, and action must be taken to help parents meet these costs. The unpalatable alternatives are that parents pay fees through loans or credit cards at extortionate rates of interest, or simply give up their ambition of returning to work.
"We hope the Government agree to pilot ‘Childcare Advance' and hope that in time it could benefit parents all over the country."
Danielle Walker Palmour, Director of the Friends Provident Foundation said:
"This report by the Daycare Trust offers a practical policy solution to a substantial barrier to many parents returning to work - meeting up-front childcare costs whilst being paid in arrears. A "Childcare Advance" would provide a flexible, affordable and accessible product offering for not-for-profit lenders. The next step is making this good idea a reality."
Ends.
NOTES TO EDITORS
1. The research was focused on five geographical areas in England: Barnet; Birmingham; Horsham; King's Lynn; and Liverpool.
For a copy of the full report call the Daycare trust press office on 0207 840 3375
Daycare Trust is the national childcare charity, campaigning for quality affordable accessible childcare for all and raising the voices of children, parents and carers. We advise parents and carers, providers, employers, trade unions and policymakers on childcare issues. We recognise that everyone is unique and we value difference in our communities. We listen to all views and are committed to act without prejudice.
Daycare Trust runs an information line (08458 726 251) on Monday, Wednesday and Friday from 10am-5pm. Parents can also visit www.daycaretrust.org.uk for information.
Daycare Trust is a member of the Campaign to End Child Poverty, http://www.ecpc.org.uk/.
For further information, contact press office at Daycare Trust on 020 7840 3350, ext 217 (out of hours 07736 311 082).
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