Disadvantaged parents spending a third of income on childcare
Joe Lepper
Thursday, March 17, 2022
Disadvantaged parents are spending a third of their income on childcare costs as a result of government failure to properly fund the sector, providers have said.
More than one in three parents with a disability are spending a third of their income on childcare costs, a survey has revealed, while black and ethnic minority parents are also spending significantly more of their income on childcare costs compared with all families.
Early Years Alliance chief executive Neil Leitch said that the government’s decision to “knowingly underfund the sector year upon year” has left providers “with no choice but to increase fees and charges, or risk going out of business completely” leading to such financial strain on parents in lower paid jobs.
-
Analysis: Understanding the impact of early years funding shortage
-
Briefing: Childcare funding dispute
Among disabled working parents 35 per cent say they are spending at least a third of their income to pay for childcare. Around one in seven spend over half their salary on nursery and childminding fees.
This is significantly higher than among non-disabled parents, with 16 per cent spending a third of their salary and six per cent spending half of their income on childcare.
Just under one in three parents from black and ethnic minority backgrounds said they are spending a third of their salary on childcare. This is double the 16 per cent of white parents who spend a third of their salaries to support the childcare needs of their pre-school age children.
Among all parents, one in five spend more than a third of their earnings on childcare.
The figures have been revealed in a survey of more than 2,000 workers carried out by the Trades Union Congress (TUC), which says workplace discrimination means workers from black and ethnic minority backgrounds and disabled workers are more likely to be in low paid jobs.
It wants to see the government boost the minimum wage to £10 an hour to help families cope with childcare and other costs and invest in more childcare funding. It is organising a cost of living demonstration in June to call for a hike in wages.
BREAKING 🚨📢: The trade union movement is organising a NATIONAL demonstration & rally to DEMAND action on the cost of living.
— Trades Union Congress (@The_TUC) March 17, 2022
📌 Parliament Square, London
📅 Sat 18th June
🕚 12-3pm
All invited | Britain needs a pay rise!
“Parents are spending a massive chunk of their pay packets on childcare bills, while their wages stagnate,” said TUC general secretary Frances O’Grady.
“This is putting huge pressure on family budgets. We desperately need a plan to get wages rising across the economy, or too many families will have to choose between turning their heating on or putting food on the table.
“Every worker in Britain should be paid a wage they can live on – that goes up with the cost of living.
“And the government must commit to a boost in childcare funding to ensure decent affordable childcare for everyone.”
National Day Nurseries Association chief executive Purnima Tanuku says that providers are being hit by “costs crisis”, including covering business rates and increased costs to pay staff and keep nurseries heated and lit.
“But government rates currently paid to providers to deliver funded childcare places do not cover their costs or keep pace with crippling inflation predicted to hit seven per cent within a few months,” she said.
Leitch added: "Nurseries, pre-schools and childminders are facing many of the same cost-of-living pressures – such as spiralling inflation and soaring energy prices – as the families they support, not to mention the impact of business rate hikes, minimum wages increases and national insurance contribution rises,” he added.
“With government funding for the sector still nowhere near what is needed to cover these costs, things are likely to get much worse before they get better.”
