Islington Council says it has been forced to put up fees because plansto open 16 children's centres by 2008 will lead to a funding gap of1.4m if the current level of council subsidy and chargingstructure remains. It says the Government has cut the council's SureStart funding by 800,000.
It has already put the plans out for consultation to parents and willmake its decision at a meeting next week.
Councillor Ursula Woolley, executive member for children and youngpeople, told Nursery World, 'We really want to create the places butit's a real stretch.'
She said that with 40 per cent of families in Islington living inpoverty, the need for affordable childcare to enable parents to go towork was paramount and that the changes were being introduced to protectthem.
Ironically, the council said that the fact that its fees have been keptdown mean that providers have missed out on subsidies, such as theChildcare Affordability Programme which requires providers to becharging more than 175 a week and that parents must be claimingWorking Tax Credit.
Under the proposals, around 18 per cent of middle-income families whouse childcare will end up paying more. Three new bands of fees would bebased on parental income with another band for children from outside theborough.
It would mean that two parents with one child under three and a jointincome of 60,000 a year would see their childcare costs rise from186 per week to 225 per week.
Ms Woolley said more would be done to educate families about availablechildcare benefits. 'People don't trust Working Tax Credit, they're notclaiming it and we're subsidising their places as well,' she said.