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Parents with young children in full-time nursery are paying up to £8,000 a year in nursery fees, according to a report. 
The Daycare Trust’s annual Childcare Costs survey, sponsored by Imagine Co-operative Childcare, found that nursery fees have continued to rise above the inflation rate for the seventh year running. 
The £8,000 a year costs are for children under two and don’t include government subsidies for three and four year olds, tax credits or childcare vouchers. However, the research shows that it is those on the lowest income who are hardest hit, with the average family spending 11% of their income on childcare and those with the lowest earnings spending 20%. 
Alison Garnham, Joint-Chief Executive, said: "Daycare Trust urges all parents to make sure they're getting all the help they're entitled to; claiming tax credits - which can cover up to 80 per cent of childcare costs - and vouchers from your employer can cut the cost of childcare considerably. Also, every parent should be aware that they are entitled to 12.5 hours of nursery education free of charge when their child is three.” 
However, she adds that even with these subsidies and tax credits, UK parents are paying around 70% of the full costs of childcare, more than their European counterparts who on average contribute only 30% towards childcare costs. The average costs of full-time childcare for a child under two is £8,368 in England, £7,384 in Wales and £7,332 in Scotland. In Wales costs have increased by four times the inflation rate. In England the cost has increased by 5%, more than double the rate of inflation. The average weekly cost of nursery in England is £159, compared to average wages of £457 a week. 
Childminder fees, on the other hand, are around £144 a week for under twos in England and have increased in line with inflation. In Scotland fees have come down over the past year. 
The Daycare Trust wants to see more subsidies for all two, three and four year olds, plus an expansion in the number of nursery hours which are paid for by the Government. The Trust also wants to see out of school care provided free for parents with the greatest financial need and heavily subsidised for everyone else. Costs for out of school care have risen by six times the rate of inflation in the last year. 
"This is a particularly worrying development considering that, from October 2008, lone parents with a youngest child aged 12 or over will be required to start looking for work or lose benefits," said Garnham. 
Read the report