Mayor urges London’s employers to make childcare more accessible

The Mayor of London, Sadiq Khan, today called on employers across the capital to help make childcare more accessible for working families as figures show parents are being 'locked out of the workplace' by rising costs and expensive upfront deposits for nursery places.

Sadiq Khan made the call as he welcomed the introduction of a new childcare deposit loan across all organisations in the Greater London Authority (GLA) family, giving parents a helping hand to get back to work.

Childcare in London currently costs costing 34 per cent more than the national average¹ while 90 per cent of providers charge an upfront cost of up to £1,500^2‎.

The soaring cost of childcare in the capital is preventing parents from starting a new job or returning to work - on average, single parents in London spend roughly half their take home pay on a nursery place.

London families also require more hours of childcare than the rest of the country because of longer commutes, paying an average of £2,200 more per year in childcare fees than families outside of the capital.³

Today’s introduction of an interest-free loan scheme will give all parents in the GLA group - including Transport for London, the Metropolitan Police and the London Fire Brigade - the funds they need to cover the up-front costs of childcare provision. Together with single-parent charity Gingerbread, who came up with the proposal to support parents to return to the workforce, the Mayor is urging businesses and organisations across London to follow suit and offer the same scheme to their employees.

The Mayor of London, Sadiq Khan, said: “London is a city of opportunity for all, and it is unacceptable that parents are being locked out of the workplace because of crippling childcare costs. I’m pleased that we have been able to introduce a childcare deposit loan across the GLA, giving working families a helping hand, but we need more of the capital’s employers to follow our lead. I’ve pledged to work with employers to make childcare more affordable and accessible, with a strategy that delivers for business and workers across London. The benefits of accessible, good quality childcare are clear all round – parents will be able to return to work, children will have more access to quality early years education, and employers will be able to reap the benefits of having skilled and eager parents back in the workplace.”

This is the Mayor’s first step towards his manifesto commitment to make childcare more accessible and affordable across the capital, as he recognises that the cost, quality and availability of childcare are serious challenges for London’s families and businesses.

Childcare costs are a major driver of London’s low maternal employment rates, which are 10 per cent lower in the capital than the national average, and 40 per cent of mothers who are unemployed say that childcare is a key barrier to getting a job. These costs also mean that too many London children are not able to access quality early education, which could help them make a strong start at school, with only 46 per cent of two year olds in the capital in government funded childcare places, compared with 55 per cent nationally⁴.

Deputy Mayor for Education and Childcare, Joanne McCartney, said: “Affordable, quality Early Years education and childcare provision is crucial to London’s infrastructure. It enables parents to work, improves children’s outcomes and helps narrow the gap between disadvantaged children and their more affluent peers. Not only are the ongoing costs for childcare prohibiting families from accessing the support they need to join the workforce, the upfront cost of starting a childcare arrangement are a major barrier for many families. I’m delighted that we are leading the way in giving parents support to cover these costs and I urge other employers to follow our lead. I look forward to working with organisations like Gingerbread to find more ways of supporting parents across the capital.”

Dalia Ben-Galim, Policy Director at Gingerbread, said: “Helping parents with the upfront costs of childcare when they start work is a brilliant move and is what Gingerbread and London’s single parents were calling for during the Mayoral election last year. Thousands of London’s single parents are being locked out of work due to the prohibitive cost of childcare and this scheme offers genuine support to parents who want to work.

“We welcome that the Mayor of London has made this available to all GLA workers, and we are keen to work with him to persuade all employers to offer a similar scheme to help parents with the high cost of childcare in London.

“A childcare deposit scheme should be as commonplace and easy to access as cycle to work schemes or season ticket loans and we look forward to working with the Mayor to see this happen for all parents across the capital.”

¹ The London Childcare Market, Family And Childcare Trust, March 2016

² Citizens Advice Bureau (2014) The practicalities of childcare: an overlooked part of the puzzle? CAB.

³ Family and Childcare Trust Factsheet, Mayoral Election, April 2016

⁴ 2015 Childcare Cost Survey, Family and Childcare Trust