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TUC warns of "catch 22" for parents

By Rachel Lawler 

The cost of early years provision for children under two-years-old has increased by 44% since 2010, according to new analysis by TUC. 

The union warned that the rising costs are creating a “catch 22” for parents as rates of maternity pay have fallen in real terms since 2010, putting pressure on them to return to work. 

According to the TUC’s analysis, the average cost of a place at nursery for children under two has increased by 44% since 2010, while maternity pay has decreased in real terms by 3%. 

The TUC found that the average cost of a place for a child under two-years-old has increased by £185 a month, or £2,200 a years, since 2010.  

This takes the average cost of a place to £7,212 a year in 2021 – up 44% from £4,992 in 2010. 

Urgent cash boost needed 

Earlier this year, a survey by TUC found that 32% of working parents with children under five were spending more than a third of their wages on childcare and early years education. 

The TUC is now calling for “an urgent cash boost for the childcare sector” to improve wages in the sector and ensure that early years provision is affordable for families. 

The union says that the early years sector is a “vital part of our economic recovery” and should be given similar financial help to that provided to transport networks. 

Stagnating wages 

Frances O’Grady, general secretary of the TUC, said: “Childcare and early years education should be affordable for all. But parents are spending a massive chunk of their pay packets on childcare bills, while their wages stagnate. 

“[…] The government has done little to support the early years sector – even when nurseries were forced to close during the pandemic. Cutting staffing ratios is the last thing we need. It would just put more pressure on underpaid and undervalued early years workers. 

“We need a proper funding settlement for early years provision that delivers decent pay and conditions for the workforce and high-quality care and education.”  

Underfunded sector 

Neil Leitch, CEO of the Alliance, commented: “Research conducted by the Alliance earlier this year found that an overwhelming majority of providers say the funding they receive for so-called ‘free childcare’ places is less than the cost of delivering them – and with even those setting that received funding increases this year warning that this won’t be enough to cover delivery costs, things are clearly going to get a lot worse before they get better. 

“Let’s be clear: these cost rises are a direct result of the government’s decision to knowingly underfund the early years sector in England and not, as ministers are now claiming, because of overly burdensome regulations. As the TUC has rightly said, ratio changes are the last thing the sector needs at such a challenging time. 

“Today's research shows yet another example of the disastrous impact years of underfunding is having on the sector. How much worse does the situation need to get, for both parents and providers, to prompt the government to sit-up and take action?”