Too many staff lack qualifications and there are insufficient numbers to ensure young children are being properly looked after, Ofsted revealed this week.
Fewer than half the 7,800 out-of-school clubs that inspectors visited over the past three years provided good standards of childcare and just 1 per cent were rated as excellent.
Last year, 11 per cent of clubs were judged to be inadequate, up from 7 per cent the year before. In comparison, almost two out of three day-care centres provide excellent or good-quality childcare, Ofsted found in its review, Leading to Excellence.
Overall standards of childcare have improved in the past three years - 97 per cent of settings are now at least satisfactory, up from 80 per cent in 2005.
But the number of childminders rated as inadequate has doubled in the past year from 3 per cent to 6 per cent, Ofsted said.
The findings come as increasing numbers of schools are offering before- and after-school care as part of the extended schools movement. All pupils should have access to wrap-around care, including holiday clubs, by 2010.
But the report said: "Concerns about out-of-school schemes include inadequate checking of staff suitability, lack of well-qualified and experienced leaders, and insufficient staff levels to meet the needs of young children when older ones are present."
The findings are based on evidence from 90,000 inspections of 84,000 early years and childcare providers in the three years up until last March, focusing on care for children from birth to eight.
The majority of after-school clubs are run by outside agencies and charities, rather than schools.
Steven Argent, co-founder of charity Schoolfriend etc, the largest single provider of extended school clubs, said he agreed with many of the findings and called for more investment in training.
But he said that the situation was likely to get more difficult as minimum qualifications for club managers are increased during the next two years.
Currently, the leader of an after-school club needs to have a level 3 qualification, equivalent to A-level, in childcare or play work. Half of the rest of the staff must have a level 2 qualification. From 2010 the Government wants club leaders to be educated to degree level.
"You would think that if Ofsted were raising the bar on qualifications, then money would be available to train staff," Mr Argent said.
"We run our own in-house training, but we have not been able to get extra funds yet to help prepare for the new requirements."
A spokeswoman for the Department for Children, Schools and Families said that pound;378 million will be available to local authorities over the next three years to secure childcare needed in their areas, money that may be used for staff training.