Families could pay an extra £800 a year
Families could pay an extra £800 a year

Childcare costs soar despite tax break

Bills have risen by a third since the coalition came to power

Jane Merrick
Sunday 23 March 2014 01:00
Comments

Families will still pay hundreds of pounds more a year in childcare costs under the coalition despite its flagship tax break for families, new research claimed yesterday.

David Cameron and Nick Clegg unveiled details of their tax break last week, saying it would save families up to £2,000 a year in payments to nurseries and childminders.

But new analysis by Labour shows that the soaring cost of childcare, which has risen by a third since 2010, and cuts to tax credits mean that a typical family will still be out of pocket by as much as £800 a year in comparison to when the coalition came to power. Labour claimed this amounted to "Cameron's Childcare Con".

The figures, based on data from the Treasury and the Family and Childcare Trust, show that over a year, a British family spends an average of £5,487.04 for a part-time nursery place for a child aged two and over, £1,298.46 more than in 2010. On top of this, the average family has lost out on £548.70 in childcare tax credits since 2010 because of changes to the system – meaning a loss of £1,847.16 per year. Because the new tax break will meet 20 per cent of a family's annual costs, this typical family would receive £1,097.41 of support – meaning they are spending £749.75 more on childcare in a year now than they did in 2010.

Ed Miliband has pledged to extend free childcare for three- and four-year-olds from 15 hours to 25 hours a week for parents in work, in addition to the Government's tax break, as well as a "primary childcare guarantee" to provide cover for before and after school childcare.

Labour spokesperson Lucy Powell said: "Parents facing a cost-of-living crisis will see straight through this con. It just doesn't make up for how much more families are paying for childcare under this government."

The Treasury did not respond to requests for comment.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Please enter a valid email
Please enter a valid email
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Please enter your first name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
Please enter your last name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
You must be over 18 years old to register
You must be over 18 years old to register
Opt-out-policy
You can opt-out at any time by signing in to your account to manage your preferences. Each email has a link to unsubscribe.

By clicking ‘Create my account’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in