Currently, working parents with three and four-year-olds are eligible for 30 hours of free childcare per week. In his spring budget today (March 15) Chancellor Jeremy Hunt expanded the programme to cover one and two-year-olds.
The changes to childcare are part of the government’s plans to improve the economy by encouraging more people to work. The programme will cost around £6billion with equivalent funding expected to be announced for Scotland, Wales and Northern Ireland.
Jeremy Hunt announced the changes will take place in stages over two years, with all parents with a child over the age of nine months, who work at least 16 hours, eligible for 30 hours free childcare by September 2025. The 30 hours offer will start from the moment maternity or paternity leave ends.
During the spring budget, Chancellor Jeremy Hunt said: “Today I want to reform our childcare system. We have one of the most expensive systems in the world. Almost half of non-working mothers say they would prefer to work if they could arrange suitable childcare. For many women, a career break becomes a career end.”
As well as announcing free 30 hours childcare for one and two-year-olds, during the childcare announcement, the chancellor called for more childminders and introduced incentives to encourage people into the profession. The government will be piloting incentive payments of £600 for childminders who sign up, rising to £1,200 for those who join through an agency.
The Chancellor also announced a 30% increase in funding or nurseries who provide free childcare. Parents who are on universal credit who are moving into work will also receive extra support by receiving subsidised childcare up front and a 15% increase in the maximum amount which can be claimed.
Who will be eligible for the 30 hours free childcare?
Currently, all families with three and four-year-olds qualify for 15 hours free childcare a week, over 38 weeks. Households with parents who earn the equivalent of 16 hours a week at the national minimum wage qualify for 30 free hours. During the budget, Jeremy Hunt widened the eligibility for 30 free hours to cover working parents of one and two-year olds.
The changes to childcare will be introduced in stages over two years - working parents of two year olds will be able to access 15 hours free care from April 2024. From September 2024, that 15 hours will be extended to all children from nine months up. From September 2025, parents working 16 hours or over will be eligible for free 30 hours of childcare per week.