Education secretary to order review of hidden childcare costs

51 minutes agoShareSaveAdd as preferred on GoogleIain Watson,Political correspondentandChris Graham

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Education Secretary Bridget Phillipson is to ask the Competition and Markets Authority (CMA) to examine the hidden costs parents may be charged by childcare providers.

The Conservative government introduced 30 hours of free childcare for most working parents of three and four-year-olds in England for 38 weeks a year, and Labour extended eligibility to parents of children as young as nine months old.

But ministers are concerned that families are still facing costs to secure places – through demands for non-refundable deposits.

In some cases parents who successfully secure a nursery place are expected to meet additional costs for meals, snacks, nappies and suncream.

They are concerned this may create a barrier for hard-pressed parents to get the childcare they need and will ask the CMA – which is tasked with promoting competition and protecting consumers – to investigate, the Financial Times first reported.

Ministers are concerned the offer of free childcare for many working parents is being undermined.

After dismal results in local elections in England this month, the government is keen to demonstrate that it is taking practical steps to tackle the cost of living.

Households are experiencing a rise in fuel prices, and bracing themselves for higher energy and food bills because of the war in Iran disrupting supply chains.

Among a flurry of government policy announcements aimed at easing cost of living pressures, Chancellor Rachel Reeves announced on Thursday that ticket prices for families at various attractions such as theme parks, zoos and museums would be cheaper during the summer holidays through a cut to VAT.

The chancellor also announced free bus journeys for under-16s in England in August and cuts to import taxes on some basic foods under a “Great British Summer Savings” campaign.

More than 1.7 million parents in England now use government-funded childcare hours, according to Department for Education (DfE) figures.

The average cost of full-time nursery – 50 hours a week – for a child under two in England is just under £149 per week in 2026.

That is a 39% drop from last year, according to the latest annual survey from the Coram Family and Childcare charity, which tracks the cost of childcare in England, Scotland and Wales.

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