It was confirmed in the Summer Budget that, from September 2017, the free childcare entitlement will be doubled from 15 hours to 30 hours a week for working parents of 3 and 4 year olds. The government will implement this extension of free hours early in some local areas from September 2016. To support delivery, the government has committed to raise the average hourly rate providers receive and is undertaking a review of childcare costs in order to set a rate that is fair for providers and delivers value for money for the taxpayer.
The government has also reaffirmed its commitment to deliver Tax-Free Childcare to support parents in the decision to go out to work, or work more, and provide security for their families. Following the Supreme Court’s judgment that proposals for delivering the scheme are lawful, Tax-Free Childcare will now be introduced from early 2017.
In the meantime, the government will hold open the existing Employer Supported Childcare scheme to new entrants until Tax-Free Childcare is launched. Parents who wish to remain in Employer Supported Childcare once Tax-Free Childcare is launched will be able to, while their current employer continues to offer the voucher scheme.
In the context of the extension to childcare support offered to parents of 3 and 4 year olds, the government is also changing the conditions for parents claiming out of work benefits so that parents with a youngest child aged 3 or older (including lone parents) who are able to work will be expected to look for work if they are claiming Universal Credit.
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