David Cameron is to announce a government childcare commission that will look at lengthening the school day and allowing childcare workers to look after more children at any one time, in an attempt to cut costs for parents.

Downing Street regards spiralling childcare costs as one of the most pressing issues facing families under pressure over living standards. The commission will be led by Sarah Teather, the children's minister, and Maria Miller, currently minister for disabled people and tipped to join the cabinet as families secretary.

Downing Street said the commission would explore the effectiveness of government support, identify unnecessary red tape that increases costs without improving quality, and look at how to encourage childcare after school and in the holidays – so-called wrap-around care. At present such wrap-around care is not commercially viable in many schools.

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