Chancellor Jeremy Hunt unveiled the official plans to boost free childcare funding by a staggering £4billion during the Spring Budget today. The move comes as concerns have been growing about the cost of childcare, amid wider cost of living and inflationary pressures putting a strain on Brition’s pockets.
Announcing the new measures to the House of Commons, Mr Hunt said: “We have one of the most expensive [childcare] systems in the world. Almost half of non-working mothers said they would prefer to work if they could arrange suitable childcare.
“For many women, a career break becomes a career end. Our female participation rate is higher than average for OECD economies, but we trail top performers like Denmark and the Netherlands. If we matched Dutch levels of participation, there would be more than one million more women who want to work, in the labour force. And we can.”
He continued: “I don’t want any parent with a child under five to be prevented from working if they want to, because it’s damaging to our economy and unfair mainly to women.
“Today I announce in eligible households where all adults are working at least 16 hours, we will introduce 30 hours of free childcare. Not just for three and four-year-olds but for every single child over the age of nine months.
“The 30 hours offer will now start from the moment maternity or paternity leave ends. It’s a package worth on average £6,500 every year for a family with a two-year-old child using 35 hours of childcare every week and reduces their childcare costs by nearly 60 percent. Because it is such a large reform, we will introduce it in stages to ensure there is enough supply in the market.”
Working parents of two-year-olds will be able to access 15 hours of free care from April 2024, in a move that’s been said to help around half a million parents.
From September 2024, the 15 hours will be extended to all children from nine months up, meaning a total of nearly one million parents will be eligible. From September 2025, every working parent with children under five will have access to 30 hours of free childcare per week.
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There is no requirement to work a certain number of hours per week, it only relates to how much a person earns.
While the news may leave many parents breathing a sigh of relief, an expert warns the move may “exacerbate” the high demand nurseries are facing as more look to snap up a place for their child.
Laura Rettie, editor-in-chief of Finance.co.uk, said: “On the one hand, the fact the price of childcare is on the political agenda is brilliant news, and today’s announcement will excite many parents – it’s essentially a pay rise for all working parents of babies and toddlers.
“But on the other hand, there is a lot of work to do. Currently, parents are experiencing difficulties in securing slots for their children at nurseries due to insufficient places to accommodate the demand.
“This announcement could potentially exacerbate the situation and push the sector into a significant crisis. While the news is promising at first glance, significant work is necessary to resolve underlying issues”.
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