Rising childcare costs leave parents better off at home

Childcare costs have soared so high that there is no incentive for some parents to work full-time, shocking figures showed today.

A couple who use childcare could be left just £4 a week better off with two incomes than they would be with one, according to independent research organisation Resolution Foundation.

It argues that because of rising childcare costs going out to work full-time is now hardly worthwhile for a growing number of "second earners" on middle or low incomes.

"Despite progress over the last decade, the cost of childcare in the UK still eats up a very large slice of family incomes," said the foundation's deputy chief executive Vidhya Alakeson.

"It's hardly worth a typical second earner going out to work more than a couple of days a week because the family will be barely better off as the extra money is swallowed up by the costs of childcare.

"This is a serious concern because increasing the level of female employment is one of the key routes through which family living standards have increased."

She called for a "major change" in Britain's childcare system.

Labour's shadow education secretary Stephen Twigg, who is chairing the party's childcare commission, said: "Labour would help families with the cost of childcare. This is critical to ensure that work pays and that parents - particularly women - are able to go back to work if they want.

"That isn't just morally right, it's good for the economy too."

A government spokesman agreed that childcare costs are far too high for parents and the system needs reform.