Working families on universal credit receive cash boost as childcare payments rise by £500
28 June 2023, 00:02 | Updated: 28 June 2023, 06:24
Universal credit childcare payments are to rise by 47 per cent for working parents on Wednesday under new government plans.
The payment increase means parents are able to claim up to £951 for one child or up to £1,630 for two or more children.
Under the new plans, the Department for Work and Pensions (DWP) has said it will provide a boost of up to £522 to parents to help cover childcare costs on Universal Credit in a bid to help to help parents ‘get back to work’.
Previously parents were only able to claim up to £646 for one child, or a maximum of £1,108 for two or more children.
Mel Stride, the Secretary of State for Work and Pensions, said of the plans: “We are supporting thousands of parents to return to work, progress their careers and boost their finances while making sure they have affordable childcare.
“By removing one of the biggest barriers to work for parents in Britain we are giving families the chance of a better future while doubling down on this government’s pledge to grow the economy and bear down on inflation.”
Work and Pensions Secretary Mel Stride joins Nick Ferrari for Call The Cabinet on Wednesday from 9am and you can watch live on Global Player.
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The plans will also extend to covering the costs of childcare for the first month when parents increase their hours or enter work, so they are able to stay one month ahead of payments on childcare and also to help low-income families struggling with the upfront costs of childcare.
DWP said parents who do so will receive 85% of the first month of childcare costs back before their next month’s bills are due.
Claire Coutinho, the Minister for Children, Families and Wellbeing, added: “We are delivering the largest ever expansion of free early education in England to make sure parents are able to access the high-quality, affordable childcare that they need.
“A working parent using 30 hours of childcare a week could save an average of £6,500 a year thanks to the new free hours offer alone.
“Parents might be surprised just how much support they’re eligible for – check all the details on our dedicated Childcare Choices website.”
The plans were first announced last month by the DWP.
It also includes a package to deliver fifteen free hours of childcare to working parents of two-year-olds from April 2024, as well as fifteen free hours from nine months to the start of school from September 2024 and finally rising to 30 free hours in September 2025.
It comes after a report by the Centre for Progressive Policy earlier this year which found that a lack of access to suitable childcare is costing the UK economy £27 billion a year.
The report found that more than half of the mothers they surveyed said they had struggled to find suitable childcare.
A quarter, equivalent to one and a half million mothers in the real world, said if they had access to suitable childcare they would work more hours.
The research estimated that this would result in an increase in economic output of £27 billion per year, or 1% of GDP.
Who is eligible?
Claimants of Universal Credit who increase the amount of hours they’re currently working will be entitled to the payment increase.
According to the DWP, there is no minimum amount of working hours to qualify for the payment, but parents must be able to prove they are increasing their work hours by “at least a few hours more every week” to qualify.
The amount of hours increased must result in parents needing more hours of childcare support every month.
Those hoping to claim under the new plans must speak to their Universal Credit work coaches.
