Glitch left thousands of families 'at risk of missing out' on free childcare

Two-year-olds whose parents are in receipt of universal credit, as well as benefits it is gradually replacing such as income support, jobseeker's allowance and working tax credit, are eligible for 15 hours a week, or 570 hours a year, of free early years education.

But an investigation by London poverty campaign group 4in10 found that a technical issue meant that the details of some families of two-year-olds already receiving universal credit are not being passed on by the Department for Work and Pensions (DWP) to councils.

This means they do not appear on local authority lists of eligible parents, leaving them at risk of missing out on their free childcare entitlement.

Those using the original IT system - known as the "live service" - which has been used since 2013, are included on the lists. However, families receiving universal credit via the most up to date IT system - known as the "full service", which was introduced in 2016 - are at risk of not being on lists passed on to local authorities. 

The campaign group said the DWP initially denied that households in receipt of universal credit are being omitted from lists, but in response to a parliamentary question from Green Party MP Caroline Lucas has now pledged to address the issue.

"Households on universal credit live service and legacy benefits are currently included on these lists. Households on universal credit full service will be included on these lists from March 2018," DWP minister Alok Sharma said.

Laura Payne, 4in10 campaign manager, said: "Working across London we could see the problems this would cause for local authorities in reaching some of their most vulnerable families and providing the early education that these children need and are entitled to."

Lucas added: "I am delighted that, after initially trying to brush the issue under the carpet, DWP ministers have acknowledged that 4in10 and local authorities have identified a serious problem with universal credit in relation to the two-year-old childcare offer, and have now committed to fixing it from March.

"This will benefit hundreds of the most disadvantaged young children."

In December last year the government announced proposals to overhaul the eligibility criteria for the 15 hours' free childcare for two-year-olds to take into account the roll-out of universal credit.

An additional 8,000 two-year olds will be eligible under the planned arrangements, which apply to those who receive universal credit and earn less than £15,400.