The Spring Budget: How it affects childcare support?

The Chancellor presented his first budget on Wednesday 15th March 2023 and announced changes to  childcare support.

Parents on Universal Credit:

There will be an increase in the maximum amount parents on Universal Credit can receive in childcare support to £951 for one child and £1,630 for two or more children from July 2023.

Also, childcare support will be paid up front when parents move into work or increase their hours, a change from the current system of being paid in arrears.

Stricter rules are being introduced for Universal Credit claimants who care for children. Claimants will be required to do more search for work or increase their hours, with additional support from a work coach.

New measures will require Universal Credit claimants who care for children between 1 and 2 to meet with a Work Coach more regularly in order to prepare for work. Further, carers of children aged 3 to 12 will be supported to increase the number of hours they are expected to search or prepare for work each week.

Childcare Scheme:

The current childcare scheme allows working parents of children aged three and four to claim 30 hours of free care a week unless one of them earns more than £100,000.  And families with two-year-olds are entitled to 15 free hours – if they are receiving means tested benefits.

The Government now plans to extend the scheme so that if both parents work at least 16 hours a week, they can get 30 free hours a week when their children are aged from nine months during term time.  The changes will be introduced in stages and starting from April 2024, working parents of two-year olds will be able to claim 15 hours of childcare. This will be extended to all children from nine months old in September 2024, before all under-fives are given the full 30 hours free childcare per week from September 2025.