£300m extra childcare support for low-income families

7 October 2011

The minimum working hours limit for childcare support will be scrapped from 2013, Work and Pensions Secretary Iain Duncan Smith has announced.

So parents who work fewer than 16 hours a week and are low-paid will get extra support. It will work out at up to £175 a week for one child and £300 for two or more. The government has set aside £300m which it said would help around 80,000 families.

However, charities such as the Child Poverty Action Group and Save the Children have said the government needed to do even more to make childcare affordable, in particular covering 80 per cent of childcare costs as soon as possible.

Iain Duncan Smith told the BBC:

“This is an additional group of people who will receive childcare and who did not get childcare under the last government’s plans. The childcare support will be a huge bonus to them.

“The truth is that there are many, many more out there who don’t work at all because they can’t make ends meet at the level. The way the universal credit is structured will benefit them enormously and we expect many more people, particularly women, to be able to work lower hours and therefore come back into the workforce.”

But Liam Byrne, shadow work and pensions secretary, said:

“It won’t mean a penny more help for parents already struggling on childcare tax credits. Universal credit is now set to lock in a ‘parents’ penalty’ that cuts back childcare payments so hard that many parents will be forced to give up work. With parents struggling to make ends meet, it beggars belief that the [government is] stopping parents working the hours and shifts they need by taking away their childcare.”