Are You Using All The Childcare Support Available To You?

Childcare Support: Are You Using It?

Working, middle-class parents are struggling with high childcare costs and relying primarily on grandparents to care for their children, according to new research by investment house Killik & Co.

In The Real Cost of Childcare Report, Killik & Co found that couples with a child under five are spending £6,500 a year on childcare on average, but overlooking a potential windfall of £8,384 per year in financial support from the Government.

The report provides an insight also into the practicalities of raising a young child when both parents work; for example, childcare costs are deterring half of them from having more children and forcing more women to reduce their working hours.

Parents’ wider family members play a vital a role in childcare, with 71% of those polled relying on family for childcare to enable parents to work. Over 92% of that help comes from grandparents (or 65% of the total respondents), who are increasingly being called upon to help with childcare as parents struggle with costs and balancing work. Over 9.2 million grandparents spend an average of nine hours a week looking after grandchildren, saving parents over £1,900 in childcare fees. In addition, over one in five (22%) of those polled are hoping that their parents or grandparents will contribute to the costs of raising their child/children.

Aunts and uncles also play an important role in helping with childcare according to 34% of those polled, and sprightly great-grandparents and cousins get involved too (9% and 8% respectively).

The survey reveals 40% of parents have cut back their working hours in the last five years due to the cost of childcare. More than double the number of women (49%) than men (22%) have reduced their working hours in the last five years due to the cost of childcare.

Parents are struggling to meet the costs of childcare and save. When asked what parents would do with any potential savings from the new childcare schemes outlined below, respondents gave a variety of answers: 48% would add it to an existing savings account, 31% would put the money towards their mortgage, 18% planned to spend more on childcare, 10% were keen to invest, 9% would add to their pension and 4.5% would pay off debt.

The vast majority of couples are not using two recently launched Government schemes that offer combined savings of £8,384 for parents with children aged three to five: 30 hours per week of free childcare in England – raised from 15 hours in September 2017 – and the Tax-Free Childcare Scheme introduced across the UK in April 2017.

  • Only 31% of parents are using the initial 15 hours free childcare, with average savings of £3,192 per annum;
  • None of the couples have started using the additional 15 hours free childcare introduced in September, worth an additional £3,192 in savings. However, just over a fifth (21%) do plan to use them in future;
  • Only a fifth are using the Tax-Free Childcare Scheme, with inherent savings of up to £2,000 if a couple spends £8,000 on childcare via an online account which can be opened through the GOV.UK website;
  • 40% of couples are using an existing Childcare Vouchers scheme, which will be closed to new applicants from April 2018, allowing parents to make £933 worth of savings per year each. Childcare Vouchers can be used in conjunction with the 30 hours free childcare scheme highlighted above.

Given that over seven in ten parents surveyed hope that at least one of their children will attend university and one in eight is planning on private education for their children, the firm behind this research says these schemes are the perfect incentive to save and invest on a regular basis.

We'd love to hear your thoughts on this. Do you use any of the schemes outlined above to help with the costs of childcare? And do grandparents or other members of your extended family help with childcare while you're at work? Leave us a comment here or come and join the conversation over on our Facebook page.

24 comments

  • Emma P.

    I use the 30hours free funding, my childcare bill has gone from around £450 a month to just £28!! It’s amazing! I now have more money to save and put back into the house and enjoy more trips with Little one. :blush:

  • Claire P.

    I don’t work but was looking to get a job so that we could take advantage of the extended funded hours. Thought to myself how great 30 hours a week would be. Didn’t last long when I started contacting nurseries...so many restrictions on when you can use the hours, what days and how many hours per day! One nursery said that my son could go 9-3 funded, but he HAD to stay on until 6pm, meaning we had to pay from 3-6pm. Their hourly rate was £4.90, so didn’t seem that bad until I found out the fee for the 3 hours was £32!! That’s how they make more money!! Gave up in the end, easier to stay at home!

    • Emma K.

      Same thing happened to me! I’m no better off :frowning2::frowning2:

  • Clare W.

    I need to look into it all properly :thumbsup: xx

  • AnnMarize D.

    15hrs per wk in Scotland- You only get the “free hours” while schools are NOT on holidays . So any time the schools are off on “any holidays” or “in service days” then that’s when the funding stops so if you work while your child is in the “free hours” then you have to pay the full amount during all school holidays . So for example the summer Holidays are going to be 6 weeks (Scotland) of full nursery fees same for Easter and October and Christmas.

    • Penny F.

      Same in england except some childcare providers will stretch the hours

  • Fay P.

    Why are there so many different schemes?! So complicated! Also, do any of them affect other benefits? I'm guessing yes?!

    • Emma P.

      I’m entitled to child tax credit. Still get a small amount as child care bill been reduced. I don’t get working tax as I only work 16hrs n have a partner. My friend didn’t do the top up as it would effect her housing benefits and she’d be worse off as she works part time n is a single mum.

    • Penny F.

      You can't get the tax freechildcare scheme if get tax credits. Which is really annoying and probably means I lose out on money that couples with good wages get unfortunately

  • Claire D.

    We spread the 30 hours over the year so use 22 hours a week as we only need 2 days so this includes all holidays! We spend £8 a month on nursery now for his snacks and it was £380 before .. definitely a brilliant scheme ! We are saving so much money Find a good nursery and they wont stick loads of restrictions on

  • Carrie W.

    I’m Confused i used the voucher scheme for nursery with my first. I’ve been off a year on maternity leave and my little one starts nursery in 3 weeks. Do I stick with the vouchers? Or go with the new government scheme??

    • AnnMarize D.

      If ur child is 3 then u will get “government funded” hours of 15 (Scotland) or 30hrs (England)

    • Carrie W.

      AnnMarize Davis my oldest gets his 30 hours now but my one year old starts nursery in three weeks so I go back to the vouchers? Or the new government scheme

    • Sue J.

      Bear in mind that a child can’t be registered with both schemes. Also, the new scheme relies on you paying into an account after you’ve been paid rather than vouchers being deducted from your salary. We’d be (very) slightly better off on the new system but decided to stay with vouchers as it’s easier and I’d never remember to transfer the money each month!!

    • Melissa L.

      I get both free hours (only 15 at our nursery) and childcare vouchers.

    • Vikki T.

      Once you leave the vouchers scheme you won't be able to rejoin in the future as I believe theyre phasing it out. I'll be using free hours and vouchers in September when hes 3. And you can use them for before/after school clubs and holidays. Money goes straight into their account

    • Carrie W.

      They said to me that I could still have the vouchers as I just froze them until my youngest starts

    • Victoria G.

      We calculated that we were better off sticking with vouchers...although since then I’ve had a third baby, stopped teaching full time and become a Childminder!!! All my parents pay me in vouchers x

  • Emma K.

    I couldn’t find any nursery near me that actually uses the 30 hours free funding. Only one used it who said my child would need to attend from 7-30 - 6-00pm 5 days a week to use it. When I actually worked out what extra I’d have to pay(minus the 30 hours) I’d have been no better off! The scheme is a con!

    • Vicky W.

      It isn't 30 hours free, its 30 hours subsidised by the government (via local council) at less than it costs the nursery to offer the place. So they add on all sorts of charges and restrictions, some hidden and some upfront. It is a con.

  • Louise L.

    Ya mate. Think I’m going to b using everything I can at the moment. Too young for free hours yet, too late for vouchers so will b tax free scheme 4 now xx

  • Sam D.

    I work every day and my daughter is in school. My mum picks her up from school and looks after her till I get home from work. During school holidays I have to use child minders and don’t get any help with child care costs as to get any of the above schemes you have to be in continuous child care for 4 weeks or more. None of these schemes are helpful for parents with kids in school when you mainly need support in school holidays

  • Samantha S.

    Couples paying £6,500...... What about single parents that pay for childcare alone? Single parents are slated for not working or not full time and yet are expected to pay the childcare from one wage. The government are thick as pig shit when it comes to childcare

  • Emma P.

    Nothing for children under 3! Great!

What do you think?

Your comment