CHILDREN from disadvantaged families are being “stigmatised” by a two-tier system of childcare in England, a report warned today.

According to the study, funded by the charitable Nuffield Trust Foundation, some childcare providers are limiting the number of places available for children funded by the state.

Many providers are asking disadvantaged parents for additional payments and some providers separate children receiving free care from those of paying parents, the research found.

The report also says that many disadvantaged families are missing out on free childcare to which they are entitled.

The study blames the complexity of the free childcare system for many of the problems.

Disadvantaged two-year-olds in England have been entitled to 15 hours of government-funded childcare for a decade and childcare provision is being expanded by the Labour government.

But the report said: “While some providers make inclusive free provision a priority, it now appears common practice (although not universal) for settings to constrain the number and structure of funded places offered and to ask families to pay additional charges for their entitlement.

“A two-tier system of provision is emerging in some cases, which, at its most extreme, is inferior and stigmatising for parents accessing the disadvantaged two-year-old entitlement.”

Education Secretary Bridget Phillipson said the report “paints a stark picture of how parents, providers and children have been failed by a lack of vision and ambition.”

“That’s why we have already launched the first round of funding to deliver school-based nurseries where places are needed most and kicked off action to protect parents from overcharging,” she said.

The change “marks the first step towards an early years system that gives every child the best start in life,” Ms Phillipson added.