SECTION SIX - COSTS OF CHILDCARE
INTRODUCTION
6.1 Section Six of the report investigates the cost of childcare and how important price and the availability of free childcare provision are for parents.
COST OF CHILDCARE
6.2 Figure 6.1 below shows that around half of those using childcare do not pay anything for it, compared to around one in four paying less that £40 every week and around one in ten paying more than £76 a week. Those not paying anything mainly include parents using informal childcare, primarily relatives and friends.
Figure 6.1 - Weekly cost of childcare
Source: 2006 Quantitative Survey
Base: 532 (those using childcare in typical week and disclosing the cost of this)
6.3 Figure 6.2 below displays total weekly costs for those using only formal childcare. Compared with previous figure, the share of those not paying anything falls to 27%. The shares of those paying between £1 and £40 a week and between £41 and £75 a week are now 40% and 20%, respectively. As expected, those using formal childcare face higher costs: the average weekly cost borne by parents using formal childcare is £36.60, compared to £23.80 for all parents using either formal or informal childcare.
Figure 6.2 - Weekly cost of formal childcare
Source: 2006 Quantitative Survey
Base: 322 (those using formal childcare who disclosed the cost of this)
Note: those accessing free formal care are almost exclusively those using nursery provision (58 of the 88 parents in this category) and pre-school (a further 12 respondents)
IMPORTANCE OF FREE CHILDCARE PROVISION
6.4 Respondents were also asked to state if they are in receipt of child tax credit or any free childcare provision. Table 6.1 shows that economically inactive parents are more likely to receive free childcare provision; almost half of parents who are not working 23 receive free childcare provision, compared to around one-third of those in employment. 21% of those not working have reported receiving the childcare element of Working Tax Credit, which is only available to people in work. The discrepancy may be due to others in the household being in receipt of Working Tax Credit.
Table 6.1 - Receipt of tax credit or free childcare provision by employment status of respondent
| Working full time | Working part time | Not working |
|---|
Receipt of Child Tax Credit | 62% | 74% | 64% |
|---|
Receipt of the childcare element of Working Tax Credit | 40% | 49% | 21% |
|---|
Access any free childcare provision | 30% | 33% | 47% |
|---|
Base: 186 (working full time and accessing childcare in a typical week); 262 (working part time and accessing childcare in a typical week); and 96 (not working and accessing childcare in a typical week). Three respondents who did not disclose their labour market status have been excluded from this analysis.
Source: 2006 quantitative survey
Note: the base numbers for those who are not working and accessing childcare in a typical week are small and should be treated with caution.
6.5 Figure 6.3 shows that childcare benefits are more important for those who are not working; 34% of this group believe that the benefits they receive are vital and that they would not be able to access childcare without them, compared to 15% of those in full-time employment and 21% of those in part-time employment.
Figure 6.3 - Degree of importance of childcare benefits by respondent's employment status
Source: 2006 Quantitative Survey
Base: 101 (respondents working full time, using childcare and in receipt of childcare benefits); 149 (respondents working part time, using childcare and in receipt of childcare benefits); and 44 (respondents not working, using childcare and in receipt of childcare benefits)
Note: Not working includes those who are unemployed and economically inactive. Those who did not state their labour market status have not been included in this figure.
6.6 Table 6.2 shows that, as expected, single parent families are more likely to access free childcare provision than two-parent families, and, far more of these families are in receipt of tax credits.
Table 6.2 - Receipt of tax credit or free childcare provision by household type
| 2 parent family | 1 parent family |
|---|
Receipt of Child Tax Credit | 62% | 85% |
|---|
Receipt of the childcare element of Working Tax Credit | 34% | 59% |
|---|
Access any free childcare provision | 32% | 42% |
|---|
Base: 405 (2 parent households using childcare in a typical week) and 142 (1 parent households using childcare in a typical week)
6.7 Figure 6.4 shows that childcare benefits are more important for single parent families. Over one-third of lone parents responding to the survey claim that the benefits they receive are vital and that they would not be able to access childcare without them, compared to only 15% of two-parent families.
Figure 6.4 - Degree of importance of childcare benefits by household type
Source: 2006 Quantitative Survey
Base: 210 (respondents who are married/cohabiting, using childcare and in receipt of childcare benefits); and 86 (respondents who are not married/cohabiting, using childcare and in receipt of childcare benefits.
Note: The number of 1-parent families using childcare benefits is small and these findings should be considered as indicative.
6.8 Key findings in this section:
- Around half (51%) of those using childcare do no pay anything for it.
- Economically inactive parents are more likely to receive free childcare than those in employment (half compared to one-third).
- Over a third (36%) of single parent and non-working (34%) families claim that the childcare benefits they receive are vital to their ability to access childcare.