Government-Funded Childcare That Still Costs Money Gets Referred to Watchdog

Education Secretary Bridget Phillipson is sending the Competition and Markets Authority after the gap between what the government promises parents and what providers actually charge them.

Bridget Phillipson will formally ask the CMA to review hidden costs in government-funded childcare places.
Families report paying top-up fees, consumables charges, and compulsory extras on top of their ‘free’ hours.
The referral follows mounting complaints that the funded-hours scheme is not delivering the zero-cost childcare parents were told to expect.
The CMA review could lead to enforcement action or new pricing rules for nurseries and childcare providers.
No timeline for the review's completion has been announced.

Education Secretary Bridget Phillipson is set to formally refer childcare pricing to the Competition and Markets Authority, asking the regulator to examine what families are actually paying on top of government-funded hours.

The referral follows sustained complaints that nurseries and registered childcare providers are attaching top-up fees, compulsory “consumables” charges, and meal levies to places that the government advertises as free.

Phillipson has not specified which provider practices are under scrutiny, but the CMA referral carries the implication that voluntary compliance has not resolved the gap between policy and invoice.

The government's expanded childcare offer, rolled out in stages from April 2024, extended funded hours to children from nine months old — a flagship cost-of-living pledge aimed squarely at working families.

The CMA has previously investigated markets including care homes and legal services, with reviews typically running twelve to eighteen months before recommendations are issued.

No figure has been put on the average top-up cost a family faces per term. The funding announcement, however, came with a press release describing the hours as “free.”