Families to benefit from £300m childcare boost

The Department for Work and Pensions said parents will be able to claim back 85 per cent of their childcare costs, rather than the previous 70 per cent, meaning a working family with two children can, as of this week, now receive up to £13,000 a year in childcare support.

The increase is estimated to benefit up to half a million families once Universal Credit is fully rolled out, the equivalent of around £300m a year.

Under Universal Credit, parents can start claiming childcare costs up to a month before they start their job and can continue to claim for up to a month after their contract comes to an end.

Employment minister Priti Patel said: “We want all families to have the chance to get on in their lives, with the security of a regular pay packet that comes with a job.

“That’s why we are making sure parents can access good-quality childcare. Universal Credit is revolutionising welfare with people moving into work faster and earning more.

“Increasing childcare support will help break down one of the biggest barriers parents on lower incomes can face when moving off benefits.”

Speaking in parliament yesterday, childcare minister Sam Gyimah conceded that a system for working out which children will receive free school meals under Universal Credit is yet to be developed.

Children are eligible for free school meals if their parents receive certain benefits, but because Universal Credit simplifies the system it will be more difficult to understand which children are eligible.

Answering a question from Labour MP Frank Field, he said: "We will continue to ensure that all children from the poorest families benefit from a free school meal.

"The introduction of Universal Credit and simplification of the benefits system mean that the eligibility criteria for free school meals will need to be updated.

"The Department for Education is continuing to work closely with the Department for Work and Pensions on this. In the meantime, while this work is on-going, any child whose parent or guardian is receiving Universal Credit will continue to be entitled to free school meals."

Universal Credit will replace jobseeker’s allowance, income support, employment and support allowance, working tax credits, child tax credits, and housing benefit.