The steep increase in the cost of living and the devastating impact of the pandemic means Britain’s parents are struggling even more with rising childcare costs and a sharp drop in the availability of places.Coram Family and Childcare is calling for the maximum amount of childcare costs paid under Universal Credit to be increased along with support for upfront costs, extended eligibility of the 30 hours provision and for the early years premium to be doubled to boost outcomes for the most disadvantaged children.

Coram Family and Childcare’s 21st annual Childcare Survey – the country’s most comprehensive annual survey of childcare costs – published today, finds that parents are now paying 2.5% more for childcare for children under two; 2% more for children aged two; and 3.5% more for 3–4-year-olds than they were a year ago.

Childcare availability has fallen sharply as the sector grapples with ongoing uncertainty and disruption. Only 57% of local authorities now report having enough childcare places available for children under 2, down from 72% in 2021, and only 59% report having enough childcare available for parents working full time, down from 68% last year, – limiting many parents’ ability to work.

There are also increasing gaps in childcare for children with SEND, with only 21% of local authorities having enough childcare, down from 25% in 2021. Similarly, availability of the 2-year-old free entitlement and the 3-4-year-old 15-hour entitlement has dropped by 9% and 3% respectively, hitting the most disadvantaged children and families the hardest.

The Childcare Survey 2022 also reveals that the number of children accessing early years entitlements has plummeted. Some 38% of local authorities have seen a drop in the number of children using 2-year-old free entitlement. The children eligible for this entitlement are some of the most disadvantaged in the country and risk missing out on crucial physical, emotional and social development. Some 40% of local authorities have also seen a decrease in the uptake of the 3-4-year-old free early education entitlements. The free entitlements have been shown to narrow the attainment gap between children from disadvantaged backgrounds and their more affluent peers, but the impact of the pandemic and the drop in uptake means that this gap is beginning to widen again, reversing years of progress.

There are significant regional disparities across England both in terms of cost and availability of childcare. The price for 25 hours of nursery childcare for those aged under two is 50 per cent higher in inner London (£183.56) than in Yorkshire and Humberside (£122.17)[cg1] . In the East of England, only 29% of local authorities report having enough childcare for children under two, while the figure was 100% for the North East.

 The ongoing impact of Covid-19

The pandemic continues to significantly impact childcare. Some providers are struggling to remain sustainable with 14% of local authorities reporting that at least a quarter of their group-based providers are facing severe financial difficulties, and that 17% are seeing at least a quarter of their childminders are experiencing the same challenges. Nearly two-thirds (57%) of local authorities have seen childcare providers raise their prices and 30% say providers have increased the number of children looked after by each staff member.

It is unsurprising therefore that 30% of local authorities thought that quality had reduced since the pandemic. This challenging period for the sector has also had an impact on recruitment with 94% of local authorities struggling to find staff with the required qualifications and experience, with most saying it is ‘very difficult’. A third of local authorities also reported seeing an increase in permanent closures of childcare settings compared to last year.

Ellen Broomé, managing director of Coram Family and Childcare, said: