Universal credit: Parents can claim more of their childcare costs

Working families on universal credit will receive a cash boost from Wednesday, when childcare payments rise by 47% in England, Scotland and Wales.

The rise means parents can claim up to £951 a month for one child or £1,630 for two or more, to cover the cost of childcare while they work.

Work and Pensions Secretary Mel Stride says the change removes "one of the biggest barriers to work for parents".

Labour maintains the plans do not go far enough.

Working parents eligible for support pay their childcare costs upfront and can then claim a refund - but the maximum for one child has been pegged at £646 a month since 2016.

The amount has not kept up with the rising cost of childcare, leaving some parents unable to work as much as they would like, according to a report by a committee of MPs last December.

The rise, announced in the 2023 Budget, is billed as part of the government's strategy to grow the economy.

Ministers say improving support for the more than two million parents on universal credit will encourage them into work, filling job vacancies and enabling businesses to grow.

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