Grandparents are demanding to be paid for the thousands of hours of free childcare they provide each year and their claim for financial recognition is supported by most parents, a report has found.

The report calls on ministers to allow grandparents to receive the child care tax credit, currently worth up to £300 a week, if they are helping parents to return to work. Only parents using nurseries and registered child minders can claim the benefit under existing rules.

The report also calls for grandparents who juggle work and care for grandchildren to receive credits towards their national insurance contributions in an extension of the scheme to be introduced for carers and foster parents next year.

The report, entitled Rethinking the Family, is published by Grandparents Plus, the charity that campaigns on behalf of the 300,000 grandparents who regularly look after their grandchildren. A YouGov poll it commissioned found 60 per cent of parents supported some form of payment.

One in four of all families, and half of all single parents, rely on grandparents to provide childcare each week. The value of the work is estimated at £3.9 billion a year.

The recession means this figure is expected to grow as working parents cut back on nursery hours, nannies and childminders. The poll found that 44 per cent of parents said they were likely to seek more grandparental help with childcare over the next 12 months.

The report also calls for "granny leave" for working grandparents to allow them to take two weeks off following the birth of a grandchild, and to have the same rights as parents to request flexible work.

Sam Smethers, chief executive of Grandparents Plus, said that it was time grandparents got the recognition they deserved.

"The existing policy focus on the nuclear family means we miss what is really going on. Four in 10 parents say they are increasingly likely to ask grandparents for help with childcare during the recession. In the tough economic climate it is families who are taking the hit. Grandparents are playing an ever increasing role in supporting family life and caring for children but their contribution often goes unrecognised," she said.

"Our poll shows that the general public appreciates the important role that grandparents play but most people do not think the Government values this highly enough. It is time to recognise the contribution grandparents make."

The Government has always resisted calls to allow tax credits to be paid to family members. Its policies have centred on expanding formal childcare such as nurseries and trained child minders.

Recent research has also cast doubt on whether care from grandparents gives children the best start in life.

Data from the Millennium Cohort study of children born in 2000 found that those in the care of grandparents struggled to socialise with their peers by the age of 3, had significantly more behavioural problems and were behind at key developmental stages compared with those in nurseries, with nannies, childminders or even other family members. The only clear benefit was their good vocabulary.

The Conservatives said that they would consider the right to request flexible work for grandparents for inclusion in the next election manifesto.

"Grandparents often play a critical role in providing the flexible childcare, emotional support and financial help that families need," Maria Miller, the Conservative spokeswoman for children, said.

"As many grandparents live longer and lead healthier lives, they will become even more important for modern families. That is why we support moves for children to have the right to see their grandparents even when their parents have separated and will examine closely the case for extending the right to request flexible working to grandparents."

The Government said that paying grandparents would be a step too far but it would explore other ways to help.

"Government intervention in informal childcare arrangements made between family members would be going too far. We would not wish to disturb family arrangements by encouraging charging between family members who would not otherwise have done so. And we believe that many people using relatives for childcare would not welcome such interference either," Beverley Hughes, the Children’s Minister, said.

"We are committed to doing more to value and support family childcare providers – including grandparents – and will hold a series of regional events this year to discuss the issues faced by family childcare providers."

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