The current limits are £646.35 per month for one child and £1,108.04 for two or more children, but those amounts haven‘t changed since 2016. The most important change is around the timing of the UC payment. Currently the parent must pay the childcare costs up front and claim that cost in arrears. From a date to be confirmed, the parent will be able to claim the childcare fees up front.
This will help parents who want to return to work but can‘t afford to pay the childcare fees in advance before they get their first pay cheque. The Chancellor also announced an extension of free childcare places to children aged one and two in England, tomatch the 15 or 30 hours of free childcare currently provided to three and four year olds in term time.
This will berolled-out in stages:
- From April 2024, all working parents of two-year-olds will be able to access 15 hours per week.
- From September 2024, all working parents of children aged nine months up to three years old will be able to access 15 hours per week.
- From September 2025 all working parents of children aged nine months up to three years old will be able to access 30 hours free childcare per week.
To qualify for the free childcare places, the parents must be working and each earning at least £659 per month, but not over £100,000 per year.
The staff to child ratios in nurseries will be changed to an optional 1:5 from the current 1:4 for two year olds, to align
with the ratios that apply in Scotland.
The payments made by the Government to nurseries to provide these free places will increase by around 30%. Currently the amount paid is well below the hourly cost of providing care, so the free places have to be cross- subsidised by charging other parents more. As education is a devolved matter, any decision to expand the free childcare places in Scotland, Northern Ireland and Wales will be up to those regional governments.
To increase the number of childminders the Government will provide all newly registered childminders with a start-up
grant of £600 and those who register with a childminder agency will receive a grant of £1,200.