Bridget Phillipson orders review of hidden childcare charges hitting parents

Education Secretary Bridget Phillipson has ordered a competition review into hidden childcare charges, citing parental concerns over non-refundable deposits and compulsory add-ons [1]. Phillipson has written to the Competition and Markets Authority (CMA), the UK's principal competition regulator [5], asking it to examine these practices [1]. The intervention comes as the government seeks to demonstrate the impact of its support packages, including a flagship childcare expansion that costs around £9bn a year [1]. The government states eligible families are saving an average of £8,000 per child annually through funded childcare hours [1]. Tom Smith, a former legal director of the CMA, noted the regulator is focusing on sectors representing significant household expenditure [1]. "They’ve recently investigated the vets sector, they’re currently investigating private dentistry, and now childcare is next," he said [1]. The CMA possesses wide powers to impose changes, including structural measures and alterations to business practices [1]. The review will also assess the role of ownership models, including private equity, in contributing to rising costs [1]. This action aligns with the watchdog's mandate to promote competitive markets and tackle unfair behaviour [5]. Concurrently, Chancellor Rachel Reeves announced a £300m 'Great Summer Savings' scheme, which includes free bus travel for children and a temporary VAT cut on theme park tickets [1]. The Labour government, led by Prime Minister Keir Starmer since the 2024 general election [3], is continuing the rollout of a free childcare policy first expanded under the previous Conservative administration [1]. The CMA's scrutiny follows its established pattern of sectoral investigations into essential consumer services [1].