The findings suggest that spending on childcare must increase to approximately one per cent of the country's GDP, to improve staff qualifications, increase wages and make childcare more affordable for parents.
The Daycare Trust report, Quality Costs: Paying for Early Childhood Education and Care, in conjunction with the Institute for Fiscal Studies and the Social Market Foundation, also calls for the free entitlement for three- and four-year-olds to be increased to 20 hours per week.
Staff qualifications should rise, the report recommends, with half of staff caring for children aged two and over to be graduates and the rest Level 3 qualified.
It also calls for tax credits to be reformed so the poorest parents can claim all the costs of childcare rather then 80 per cent and for the work test of the childcare element to be removed.
Daycare Trust joint Chief Executive Emma Knights said, ‘If the Government are to achieve the vision they set out in their Ten-Year Childcare Strategy then our research shows that a step change is needed in investment to achieve high quality provision.
‘When you consider that this country spends £23.4bn per year on higher education and £30.1bn on secondary schools, is it not right that we should invest more in early years, where research shows that high quality education and care can make the most difference in a child's life.'
For the full report visit www.daycaretrust.org.uk