Early Learning and Childcare (ELC) – parents' views and use: research findings 2025

5 Affordability of childcare

This chapter looks at the affordability of childcare for children aged under six, exploring the amount spent on childcare per month by age and difficulties faced in affording childcare.

5.1 Amount spent on childcare by age

Around half (47%) of all survey respondents used paid-for childcare. On average, these parents spent £726 per month. The average cost per month was £733 on children under three and £635 on children aged three to five. In 2022 the equivalent figures were £533 on children aged under three and £306 on children aged three to five, therefore this appears to have increased however these figures are not directly comparable^[21].

It is not surprising that the average cost was higher for children aged under three than for three- to five-year-olds given eligibility for funded ELC. As shown in Figure 5.1, a greater majority of parents with children aged under three were spending over £500 per month on childcare compared with parents of three- to five-year-olds.

Base: Parents of children using paid-for childcare (unweighted base; all children, n=3,564; children aged 0-2, n=1,641, children aged 3-5, n=2,161).

For parents of children aged under three who paid for childcare, the mean amount spent on childcare increased as income rose, from £546 per month for households on incomes under £16,000 per annum, to £832 for those earning over £60,000. Those living in the 80% least deprived areas spent more on average per month compared with those living in the 20% most deprived areas (£753 compared with £544), and those who spoke English as an additional language spent more monthly than those with English as a first language (£825 compared with £715).

For parents of three- to five-year-olds, households more likely to spend more per month on childcare were those:

• With two-parents (£579 compared with £447 for single-parent households).
• With two parents in work (£587, compared with £424 for those with one parent in work).
• Living in the 80% least deprived areas (£819, compared with £494 for those living in the 20% most deprived areas).
• With one child (£780, compared with £415 for those with two children and £391 for those with three or more children).

Supplementary Tables D7a-D18d outline the average cost of childcare according to the combination of types of childcare used. Across the different combinations of childcare, the cost was greater for children aged under three, with those using paid-for childcare only spending the most across these age groups and overall.

5.2 Difficulties affording childcare

Survey respondents who paid for childcare were asked if they had experienced any difficulties affording their childcare costs for children below primary school age in the last 12 months (Figure 5.2).

Base: Parents of children using paid-for childcare (unweighted base; all children, n=3,567; children aged 0-1, n=968, children aged 2, n=866, children aged 3-5, n=2,547).

Fifty-six per cent of respondents said they had not experienced difficulties affording childcare in the last 12 months. This figure was 34% in 2022. However, 42% had experienced either some difficulties (32%) or significant difficulties (10%) affording their childcare costs. In 2022 these figures were 46% and 16% respectively.

Parents of children aged under three were more likely to have faced difficulties in affording childcare in the last 12 months compared to parents of three- to five-year-olds. Around two-thirds of parents of under-three-year-olds had faced some (46%) or significant (15%) difficulties, whereas around a third of parents of three- to five-year-olds had experienced some (26%) or significant (7%) difficulties.

Respondents who were more likely to report having experienced no difficulties affording childcare costs in the last 12 months were from households with:

• Two-parents (53%, compared with 28% of single-parent households).
• Two parents in work (53%, compared with 32% with one or no parents in work).
• One child (66%, compared with 42% of households with two or 39% three or more children).
• No children under six-years-old with ASN (57%, compared with 41% of households with a least one child under six years olds with ASN).
• Living in the 20% most deprived areas (75%, compared with 46% of those in the 80% least deprived areas).

5.3 Sources of difficulties

Those who had experienced difficulties in affording childcare were asked what factors contributed to this (Figure 5.3). They were provided with a list of options and were able to select all that were applicable.

Base: Respondents who had experienced difficulties in affording childcare in the last 12 months (unweighted base, n=1,416)

The majority of respondents (87%) said that the overall cost of the childcare hours they needed made it difficult for them to afford childcare. Around one-quarter (23%) said that having to pay childcare fees upfront made it difficult for them to afford. Factors that made it difficult to afford childcare did not vary between parents of children of different ages.

Those in two-parent households were more likely to say that the overall cost of the childcare hours they needed made it difficult to afford childcare (88% compared with 76% of single-parent households). Single-parent households were more likely to say that having to pay childcare fees upfront made it difficult to afford childcare (44% compared with 20% of two-parent households).

5.4 Affordability of additional funded ELC costs

In interviews, parents were asked whether there were any additional costs associated with their funded ELC hours. In Scotland, Funding Follows the Child guidance states that ‘Settings delivering the funded entitlement must ensure that access to the funded hours are free at the point of access […] [that] additional charges to parents and carers relating to the funded hours must be optional’ and that ‘Every child receiving a funded ELC session will receive a free meal’^[22].

Interview participants reported paying for extra supplies for their child, including nappies, wipes, suncream, and providing clothes or shoes. Some also described the cost of packed lunches or snacks as free meals were not available to children aged two- to five-years, or snacks were not provided by the ELC provider. These costs were generally described as manageable, and in many cases if participants could not afford these items the ELC provider would be able to supply these. Participants reported that providers often used money from fundraising or donations to be able to supply these items. Fundraising or donations were voluntary and generally seen as important for providers to be able to provide additional supplies to children from more disadvantaged backgrounds. However, participants did feel that providers should not have to fundraise in this way, and that the government should be providing more funding to cover these costs.

They’ll do like sponsored walks to try and raise money […] we understand why they do it but I think it’s wrong when it’s a government funded nursery […] There’s an awful lot of kids that probably get sent to nursery and don’t have a spare pair of clothes. (Parent of a two-year-old and a three- to five-year-old)

Some participants noted that the cost of travel to and from their ELC provider was a cause of financial difficulty, especially if the ELC setting was not within walking distance. This was particularly difficult for those who did not have a car as they relied on buses (where available) or taxis. Participants’ travel costs were often higher due to limited availability of funded ELC provision in the local area. For example, one participant reported having to move area mid-year for personal reasons. In their new area, there was no space available at their local ELC provider for their child therefore, they had to take a space at an ELC provider that was further away which required travel by bus or car. Managing the cost of this travel was made more difficult because their partner could not travel or work due to a health condition. Therefore, they also were not able to work as they were needed to manage drop-off and pick-ups.

There was no assistance on those costs at any point but they were well aware that we were sometimes during the winter we were paying a hefty amount of cash on the cabs. […] When you’re going five days to the nursery it will be £200 [a week] easily just for the cab. (Parent of a three- to five-year-old)

If there’s a day where we just don’t have the money, we don’t have the fuel we just can’t put her in and that makes us feel a bit bad as parents sometimes. But I mean at the same time they have gave her somewhere that’s a bit too far away. (Parent of a two-year-old and a three- to five-year-old)

5.5 Paying for childcare

Interview participants were paying for childcare for a number of reasons.

5.5.1 Paying for childcare in addition to funded ELC

Some participants were paying for childcare as well as receiving funded ELC because the funded hours did not cover the hours they needed, for example because they did not cover their working hours. While paying for additional hours enabled them to work, the cost of the additional childcare was sometimes a similar amount to the hourly wage of the parent, and this was therefore a consideration when transitioning from part-time to full-time work. Some participants were not working, or were working part-time, because they could not afford to pay for any additional childcare. Participants said it felt as though they were being penalised for working due to the cost of childcare and restrictions around opening times of ELC providers.

I earn £12.50 per hour and the hours at the nursery cost the same. […] You have to consider if it’s worth to work more to only pay the nursery. (Parent of a three- to five-year-old)

With wraparound childcare […] the compromise is either we do that or we don’t work. […] if either myself or my husband decided we weren’t working, we would then perhaps be looking at having some help and support financially from the government. […] It does feel like you are penalised because I don’t know anybody that works a full-time job whereby they could perhaps start work at around about half past nine and finish at half past two. (Parent of a three- to five-year-old)

Top-up hours were not always available, dependent on the ELC provider. However, participants who did not have this option available to them said they would pay for extra time if it were available. Some were using alternative private childcare hours to meet this need. One parent described having to pay for half an hour of unfunded time in the middle of the day during their funded hours^[23], and that they believed this was a way for private providers to generate additional income due to insufficient government funding for the proportion of funded places they offered. Some participants stated that they would not be able to afford to top up their funded hours, or that they were having to reduce their paid childcare hours as they could no longer afford them.

Financially I can’t afford that when I’m not on placement […] I’ll be changing it to half days come next week when I’m off just to save some money because, like I say, it’s very hard to get that kind of money together quickly to then pay them. (Parent of a two-year-old)

Among participants who were paying for additional hours, there were those who said this was made affordable by a number of discount schemes available both term-term and during summer. For example, some said that having tax free childcare or Universal Credit childcare payments available to them made their childcare more affordable. It was also noted that providers offered discounts to parents who worked in the NHS, which parents said eased financial pressure. Participants noted that they would not be able to afford to pay for these hours without these discounts.

5.5.2 Paying for childcare as families’ main provision

In interviews, some parents discussed paying for private childcare hours for eligible children as their main source of childcare. This was either because no funded spaces were available locally or because the funded hours offered by a provider were not sufficient to enable parents to work. Some participants also reported that their local funded ELC providers did not offer childcare for eligible two-year-olds, therefore they were using private ELC for their younger children. Participants paying for ELC, generally felt the cost for private childcare was very high, with some ELC providers increasing prices significantly or regularly.

When we first started using the nursery it was like the cheapest one in the area. A couple of years ago it got bought over by a larger organisation who seemed to be buying up loads of nurseries in the area and I would say that we’re pretty unhappy with the nursery since then, like the prices have gone up a lot and they put the prices up really regularly. They moved the way that they charge you from in arrears to in advance and they did that in December, at Christmastime. (Parent of a three- to five-year-old)

Some participants were receiving financial help from family members in order to afford private childcare. Participants primarily paying for private childcare also discussed the impact of multiple births on their childcare needs. They were advised by funded ELC providers and other parents with twins or triplets, that it would be difficult to place multiple children in a single funded provider due to a lack of spaces. This resulted in them opting for private ELC because the logistics of having children in different ELC settings would be challenging.

The Head of the Nursery was very much like oh it’s going to be really difficult to kind of find you a place because there’s two of them […] it felt very like doom and gloom […] Our impression was that we weren’t very likely to get a place. (Parent of a three- to five-year-old)

Having to pay for childcare in these circumstances caused financial strain. Some participants had to give up work to look after their children because the cost of childcare was too high, or was the same as what they would have made working.

We did financial planning before we had children, we knew that we could afford two children. We had our second sooner than we’d planned but then when that turned out to be twins that’s financially been extremely difficult. […] I was quite surprised that there was no government support at all for funding childcare for multiples and I did say if we’d have had triplets we just wouldn’t have been able to cope. […] I’ve also had two interviews, like job interviews recently that I just can’t take because I can’t financially, I can’t make it work with childcare. (Parent of a two-year-old and a three- to five-year-old)

5.6 Improving the affordability of childcare

As reported above, 42% of survey respondents had experienced difficulty affording childcare costs in the previous 12 months. The main challenge for parents for three- to five-year-olds was that the number of funded ELC hours available did not meet parents’ needs, particularly for those who worked full-time. Therefore, some interview participants, particularly those in work, would like to see the number of funded ELC hours extended further.

To improve affordability within the current provision of 1140 funded hours participants would like there to be more funded ELC providers so they can choose a provider that offers the hours they need to fit around work and other commitments rather than pay for additional childcare. Participants would also like greater flexibility in how hours can be used at these providers so funded hours are only deducted for the hours a child is in a setting. This would allow parents to make use of all 1140 hours and stop or limit the number of hours of ELC they pay for. Participants perceived that the way ELC providers receive funding from the government for funded hours made this difficult. Participants who also worked in ELC settings said the funding provided to ELC providers per hour per child did not reflect the actual cost of the childcare. Therefore, it was not always financially viable for ELC providers to offer funded hours, further restricting the funded ELC provision available.