Chancellor Jeremy Hunt is expected to announce a major shake-up to childcare in Wednesday’s Budget to try and help parents struggling to make work pay across the country.
But with the announcement set to focus on parents on universal credit, i spoke to families struggling to make ends meet to pay for childcare.
Charlotte Jansingh, 38, from Rochester, Kent, says when she looks at her monthly take home pay and the childcare costs for putting her two children in nursery, she feels physically winded.
“It is crazy and is like a kick in the stomach,” she said. “When your childcare bill is so high that it wipes out your entire salary, you start questioning, ‘Why am I working? What is the point?’
“But I want to work – [I] enjoy working and need that fulfilment. But it is so difficult when you know you are effectively going to work for no money because the cost of childcare is so high.”
Charlotte, who is married to James Whittaker and has a four-year-old daughter Raye and a 19-month-old son Laurie, is a legal assistant for a property developer and says that despite earning a good wage, – about £2,900 a month – her nursery costs for two children going in full-time are £2,208 a month. Travel to work costs about £3,500 a year, meaning her income is completely swallowed up.
In fact, Charlotte tells i that if her employer wasn’t so flexible and wanted her to travel to her London office to work five days a week instead of the two in the office she is doing, she would be paying to go to work as the commuting cost would be in the region of £6,000, sending her into minus figures, it unfeasible for her to work.
Charlotte is one of a growing number of women struggling to balance a career against childcare costs as research reveals many are giving up in defeat because they are working for virtually nothing or even paying to go to work once they have paid for their childcare arrangements.
Changes to childcare funding in Wednesday’s Budget are set to focus on parents claiming universal credit to get more help with childcare costs under the Government’s plans to encourage people back into work.
Campaigners have warned the current scheme of paying for childcare and then later claiming a refund risks people getting into debt.
The chancellor is expected to announce in his Budget on Wednesday that the Government will start paying childcare costs up front for those on the benefit.
Research carried out by campaign group Pregnant Then Screwed shows that a staggering three in four mothers – 76 per cent – who pay for childcare say in no longer makes financial sense for them to work.
One in 10 parents in the survey of more than 24,000 parents say that their childcare costs are now the same or more than their take home pay.
Charlotte says she was left feeling helpless when her children’s nursery increased their fees by 15 per cent in January as she knew she couldn’t afford to work. Luckily, after she rang them extremely upset and told them the hike in costs would take almost her entire salary, she managed to negotiate a 7.5 per cent rise instead of the 15 per cent.
Charlotte says her nursery costs are high despite using the free 30 hours of childcare and the Government’s tax free childcare allowance. Her nursery costs for both her children are £26,000 a year – but the tax-free childcare is capped at £500 every three months per child and up to £2,000 a year.
“I love my work. I knew I was at a point in my career where I had a real opportunity for progression,” she says. “But at the same time, you are always torn with guilt as a parent, and I started thinking why am I working while my children are in nursery, when I am basically earning no money, and you wonder whether you have made the right decision.
“I am on a good salary, which means that by working, we got to go on nice holidays and have some luxuries. But when that’s suddenly taken away because your childcare bill is so high, you start thinking: ‘if I’m not getting any added value from me being at work, why am I doing it?’
In the end, Charlotte says the tipping factor in her deciding to stay at work was knowing her childcare costs would ease in September when her daughter starts school – and because her employer is paying for her to do a diploma that will enhance her career.
“I am working for a legal team and have taken on more responsibility and am doing more paralegal work,” she explains. “To support this, my company are paying for me to do a diploma to give me a broader understanding of the legal system. When I have completed it, I can formally say I am a qualified paralegal.
“I have only recently started it and it takes two years, but I should be able to do it in 12 to 14 months, depending on how much time I put in on it. My work agreeing to pay for this diploma is what swung it for me to stay working despite not actually having any money left after childcare, because I know it is future-proofing and will mean I can progress and earn a better salary in a few years.
“So me and my husband decided to suck it up for a while and manage until our daughter starts school. But it is still such a kick in our finances.”
However, Charlotte says she knows she is in a fortunate position as she and her husband can just about keep going until their daughter starts school and the financial pressure eases a bit – but she knows many families would struggle to stick it out and manage during such a difficult period.
“I am lucky because my husband is an events manager and earns £50,000 a year so he can cover the household bills, while my salary just essentially pays for childcare and the cost of me getting to work.
“However, if my husband earned a little bit less, such as £45,000, it just wouldn’t be manageable and I would have to say I am going to have to come out of work.
“There will be so many families struggling a lot more than us and so many women will be pushed out of work because of this.”
Charlotte also knows the pressures nurseries are under and that they have no choice but to put the fees up because the funding from the Government just isn’t adequate. “The whole situation is outrageous and we should be able to manage on our salary, but are getting to the point where we won’t be able to soon,” she says.
“It just feels like the Government isn’t taking it seriously enough. They say they want to get more people back into the workplace, but there are so many women who can’t do that because the support and funding for childcare just isn’t there.
“Also, the people who work in childcare are amazing, but aren’t getting paid properly and deserve more. So many other countries have a much better system and childcare is part of their infrastructure. We just don’t have that same support here.”
A report into the childcare crisis from Pregnant Then Screwed reveals that one in three parents (32 per cent) have had to rely on some form of debt to cover childcare costs. One in five parents 22 per cent) say their childcare costs are now more than half their household income.
Charlie-Rose Castanheira, who lives in Tamworth near Birmingham, with fiance George Tracy-Adams and two-year-old daughter Pippa-Rose, tells i her entire paycheck is “eaten up by her childcare costs”.
She says she has had to delay pursuing her career for two years, but has made a decision with her partner to bite the bullet and take out loans to follow her dream of becoming a barrister.
Charlie-Rose, 26, was living in London before the pandemic and working as a civil litigation paralegal. However, when Covid hit, the couple moved to Tamworth to be closer to family. After having their daughter, they soon realised they couldn’t move back to London with a child and not have any support around them.
“When Piper-Rose turned one, I put her into nursery for two half-days a week, just because she was bored at home with me all day,” says Charlie-Rose. “She absolutely loved it so I thought I’d put her in for more days, but I realised I’d have to return to work to do that.”
Charlie-Rose managed to get a job working in retail as a friend had a shop and wanted someone to do part-time work. “I thought that if I worked under 16 hours, we’d still get some Government help and Piper-Rose could do three full days at work and we’d make it work that way,” she says.
“But I didn’t realise that we’d misjudged the calculations and as soon as I started working, our funding from the Government stopped completely.”
As Piper-Rose was loving nursery so much, Charlie-Rose knew it wasn’t fair to take her out. “Piper-Rose is so happy at nursery and it keeps her stimulated. It wouldn’t have been fair to pull her out of nursery and go back to being at home with me all day.
“I was also in the situation where I was happy being in work, even though it was not the work I was doing before. So to cover Piper-Rose’s nursery costs, I immediately had to up my hours from 16 hours to 35 hours and pretty much my entire pay check covers her nursery fees and my travel to and from work.”
Charlie-Rose says the only reason she has continued to work is because her little one loves nursery so much and her fiance’s income is able to cover their household bills. The money she earns covers their childcare bills. “Piper-Rose does three full days at nursery and her nan has her on Friday and Saturday for us, and I usually end up working Tuesday to Saturday and the money I get from that covers the childcare costs for those three days in nursery.”
However, Charlie-Rose felt frustrated that she was delaying her career plans to become a barrister. “I got stuck in a loop where I couldn’t afford not to work, but I didn’t have any money as a result of working,” she says.
“After discussing it with my fiance, we decided that I wouldn’t delay my career plans for another year, so I have handed in my notice and … will be going back to university to re-train as a barrister.
“We felt it was going to be tough whenever we did it, so we may as well do it now. I am taking out loans to cover the cost of me going back to university and the hope is once I am fully qualified, we’ll be able to pay them off.”
As well as taking out bank loans, Charlie-Rose has borrowed some money from family and has applied for scholarships, but won’t know until August if she will get them.
She feels disheartened that she has had to be forced into taking this route if she wants to pursue her career and is angered by the predicament working mothers face. “A lot of my mum friends with children of a similar age either don’t work or have had to reduce their working hours to school hours, which impacts what jobs they can do.
“It is a terrible situation and there isn’t any support out there and there is not enough understanding of the challenges women face.
“There is a big push around women being able to ‘have it all’ – have a career and a baby. But the Government hasn’t actually put the support in place to allow women to do that.
“I am working basically for free as that’s the choice I’ve made and I’ve been fortunate enough to be able to make that decision because of my partner and his job and because we have such a supportive family and network. But I know a lot of women don’t have that.”
Lauren Fabianski, head of campaigns at Pregnant Then Screwed, says: “Mothers are livid. We’ve had enough.
“Women can’t pay to go to work – it doesn’t make sense. As a result, we are seeing more and more women falling needlessly from the workplace.
“If parents cannot afford or access the childcare they need, then we cannot rebuild our economy.
“Despite years of campaigns, reports, protests and letters, there is still no plan or strategy to deal with this issue, meanwhile the situation is drastically deteriorating.
“The solution is staring the Government in the face – invest in childcare and early years education, and enable both children and the economy to flourish.
“The Government cannot continue to add sticking plasters to address the fundamental issues that our drastically under funded childcare sector is facing. We need them to start taking these issues seriously.”
A Government spokesperson said: “We recognise that families and early years providers across the country are facing financial pressures.
“That is why we have spent more than £20bn over the past five years to support families with the cost of childcare, doubled the free childcare entitlement for working parents of three and four-year-olds to 30 hours, introduced 15 free hours a week for disadvantaged two-year-olds, and have provided additional funding for local authorities to increase the hourly rates paid to providers.
“On top of this, working parents on universal credit can claim back up to 85 per cent of their childcare costs.”