London childcare costs leave many parents on the minimum wage little or no better off for working more, a new report warns.

The report, Children in London – The extra cost, by Loughborough University’s Donald Hirsch for Child Poverty Action Group and Trust for London, found most of the costs children bring are similar in and outside London, but the capital’s housing and childcare costs associated with kids are dramatically different from the rest of the UK.

While many London parents think it’s essential to work full-time to make ends meet, high childcare costs can mean they are not better off if they do, especially when children are young.

The report finds a parent with one child working on the minimum wage in London would be around £4 a week worse off if they increased their working hours from 32 to 33 hours because of high childcare costs.

Outside of London, a parent in the same situation would gain 62 pence currently or £1.16 under Universal Credit from April 2016.

Childcare can cost 50% more in London than elsewhere in the UK and full-time care (30-plus hours) for kids in the capital exceeds the cap on the help available with the costs.

Chief executive of Child Poverty Action Group Alison Garnham said: “Our research shows it is an uphill struggle for London parents on a low wage to improve their family income.

“They’re up against sky-high housing costs but if they work more hours to pay the rent they’re often no better off because they’re clobbered by childcare costs.

Mubin Haq, director of policy and grants at Trust for London, said: “Surprisingly this new research shows that for some costs, particularly travel, it’s actually cheaper to bring up a child in London than outside of the capital.

“But these savings are dwarfed by the large sums families need to find to pay for childcare and housing, which are significantly higher here in the capital.

“Without intervention and support by Government, London will increasingly become a city where those on modest incomes will be unable to bring up a family.”