Jeremy Hunt has promised up to 30 hours a week of free childcare for working parents in England with children as young as nine months.
The Chancellor hopes that the phased policy, which will be fully introduced by September 2025, will encourage more parents to return to work.
– Who will get free childcare?
Under the current system, parents of three and four-year-olds in England are eligible for 15 hours of free childcare per week, and working parents with children in the same age group are eligible for 30 hours of free childcare.
Now all eligible households in England with children as young as nine months – where all adults are working at least 16 hours a week – will be entitled to 30 hours a week of free childcare.
The offer of free childcare will be available to working parents of two-year-olds from April 2024, covering around half-a-million parents, but initially it will be limited to 15 hours.
From September 2024, the 15-hour offer will be extended to children from nine months, which the Government has said will help nearly a million parents.
The full 30-hour offer to working parents of children under five will come in from September 2025.
– What funding has been announced to improve childcare?
The Government will provide £4.1 billion by 2027-28 to expand the 30 hours a week of free childcare for working parents of younger children in England.
Ministers will also provide £204 million in 2023-24, increasing to £288 million in 2024-25, to raise the hourly funding rate paid to childcare providers in England to deliver the existing free hours offer.
The Chancellor said the Government will pilot incentive payments of £600 for childminders joining the profession, and £1,200 if they join through an agency.
Mr Hunt said the Government will fund schools and local authorities to increase the supply of wraparound care so all school-age parents can drop their children off between 8am and 6pm.
The Chancellor said the Government aims for all schools to start to offer a wraparound offer, either on their own or in partnership with other schools by September 2026.
– Why is the Government providing more childcare support to parents?
The Chancellor has faced pressure to act on concerns about the cost of childcare and he acknowledged on Wednesday that the country has “one of the most expensive systems in the world”.
A recent survey by the charity, Coram Family and Childcare, showed that more parents across England are struggling to find childcare places and are facing higher prices which are “freezing” them out of work.
It found that the average cost of a part-time childcare place (25 hours) a week for a child under two in a nursery is now £150.89 across England.
Last week, shadow education secretary Bridget Phillipson said a Labour government would completely overhaul Britain’s “broken” childcare system, and she said she wanted to “move away” from the current system of free childcare provision as it would not solve problems of availability.
– Is there enough childcare provision and staff for the policy to work?
Early years leaders are concerned nurseries and childminders could struggle to deliver additional places for younger children if the funding provided by the Government does not cover increasing costs.
A number of early years providers have reported struggling financially, with some nurseries forced to close in recent years, due to funding pressures.
Recruitment and retention challenges in the childcare sector could also make the policy hard to deliver.
The survey Coram Family and Childcare, released last week, found that only half of local authorities in England said they had enough childcare places for children under two.
It also revealed that the number of local authorities in England who report having enough places for the universal 15 hours a week free childcare entitlement for three and four-year-olds has dropped to 73%.
A survey by the National Day Nurseries Association suggests that 98% of nurseries in England say their funding rates do not cover delivery costs and 83% expect to either make a loss or break even.
Neil Leitch, chief executive of the Early Years Alliance, said: “At a time when settings are closing at record levels and early educators are leaving the sector in their droves, unless the proper infrastructure is put in place by the time the extended offers are rolled out, many parents of younger children expecting funded places to be readily available to them are likely to be left sorely disappointed.”
– What are the plans for ratios in early years settings?
The Government will change minimum staff-to-child ratios from 1:4 to 1:5 for two-year-olds in England but the Chancellor said the change will be “optional”.
A petition signed by more than 109,000 people suggested changing the balance could be dangerous for children, and childcare leaders warned that more staff could leave the profession if ratios were changed.
Mr Leitch called the decision to push ahead with the change “shameful”.
He added: “Parents want affordable care and education, but they also want to ensure that their children are in safe environments receiving quality care and education – something this policy completely flies in the face of.”
How will parents on universal credit be given help with childcare?
Families on universal credit will receive childcare funding upfront, rather than in arrears, to help parents who struggle to afford upfront costs for childcare.
The maximum universal credit childcare allowance – which has been frozen at £646-a-month per child for years – will increase to £951 for one child.