Extra free childcare helps higher earners - report

Help with childcare costs for working parents, announced in the Budget, is "unfairly targeted" towards higher-income families, a report by Coram and the Joseph Rowntree Foundation says.

The charities say the plans, in England, risk widening the gap between disadvantaged children and their peers.

From 2025, working parents will be entitled to 30 hours of childcare for children from the age of nine months.

The government says this will remove barriers for parents who want to work.

But the report says children whose parents do not work will be left behind, "storing up problems for later in the education system".

Currently, children aged three or four of eligible working parents are entitled to 30 government-funded hours per week, during term time, but this is due to be extended to cover younger children.

The changes will be phased in for households in England where the parent or parents each earn at least £152 a week, on average, but less than £100,000 a year.

But this would give the higher-income families "more and more childcare - and children from lower income families are even more likely to miss out", Coram family and childcare head Megan Jarvie said.

• Who can get 30 hours of free childcare?

Student nurse Isabelle Roters, from Manchester, spends weeks at a time on placement at her local hospital but can only afford to send her two-year-old to nursery one day a week.

Her husband is a paramedic and she sometimes works evening shifts in the accident-and-emergency department for extra money - but they are not entitled to any government-funded hours as she earns below the £152-a-week threshold.

They end up using leave or asking family to help but are mostly "winging it from one to day to the next", Isabelle says.

All children should be able to benefit from attending nursery, which not only helps parents work but also "brings children on socially", she adds.

Attainment gap

Coram and the Joseph Rowntree Foundation (JRF) are calling for 15 government-funded hours per week during term time for all two-year-olds and 30 hours for all three- and four-year-olds - regardless of parental income - as well as investment over time to drive up the quality of provision across the sector.

"We need to balance the importance of working parents and educational outcomes for children," Ms Jarvie told BBC News, "and at the moment, we're leaning a bit too far towards employment for parents.

"Unless we focus relentlessly on raising the quality of early education and making sure that all children - and particularly disadvantaged children - are able to access it, we're going to see the attainment gap widen."

The attainment gap - the difference in educational performance between disadvantaged pupils and their peers - increased in 2022 to the highest level in a decade.

This suggests disruption to learning caused by the pandemic had a greater impact on disadvantaged pupils, according to a Department for Education report.

Government-funded hours in childcare were originally introduced to narrow the attainment gap, as well as help parents manage childcare costs.

But Christine Farquharson, from the Institute for Fiscal Studies (IFS), says the childcare system is now "increasingly focused on helping parents to work, rather than prioritising early education to support children's development ahead of starting school".

IFS analysis shows the extension of the government-funded hours will directly benefit just over half of parents with a child aged nine months to two years, including 80% of those with household incomes above £45,000 but just 20% of families earning less than £20,000 a year.

When will the changes take effect?

• April 2024: Eligible two-year-olds will be entitled to 15 hours of government-funded childcare per week, during term time

• September 2024: Eligible children between nine months and two years will be entitled to 15 hours

• September 2025: Eligible children between nine months and three years will be entitled to 30 hours

A Department for Education official said the expansion of government-funded childcare in England would be worth an average of £6,500 a year for a working family.

"Low-income families already qualify for 15 hours' free childcare for two-year-olds, a year before all children become eligible," the official added.

But as the funding does not cover providers' costs, additional charges for meals, extended hours and registration fees can act as a barrier.

Jonathan Broadbery, of the National Day Nurseries Association, said: "It's really challenging for those families to meet the additional costs, because everybody wants to be delivering high-quality places that children really benefit from but that can't be done cheaply and easily." And many nurseries, especially in poorer areas, had a waiting list for government-funded places, because of a lack of staff.

In the spring Budget, the chancellor also announced families on universal credit would have childcare costs paid upfront, rather than having to claim them back, and the £646 monthly limit on childcare claims would rise to £951.