Phillipson asks CMA to probe hidden nursery costs

Education Secretary Bridget Phillipson will ask the Competition and Markets Authority to examine the extra costs parents face when they use government-funded childcare.

The previous 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. Labour extended the offer to parents of children as young as nine months.

Ministers say some nurseries still require non-refundable deposits and charge for meals, snacks, nappies and suncream even when the core hours are free. They fear these charges create a barrier for families already under financial pressure.

The Financial Times first reported that Phillipson will ask the CMA, which promotes competition and protects consumers, to investigate the practice.

The move comes after the government suffered poor results in local elections in England this month. Ministers want to show they are acting on the cost of living.

Households face rising fuel prices and expect higher energy and food bills because of the war in Iran and its effect on supply chains.

Chancellor Rachel Reeves announced on Thursday that families will pay less VAT on tickets to theme parks, zoos and museums during the summer holidays. She also said under-16s in England will travel free on buses in August and that import taxes on some basic foods will be cut 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 figures. The average cost of full-time nursery care for a child under two is just under £149 a week in 2026.