Universal Credit claimants who have children will be getting more cash in their pockets for childcare from the end of this month.
From June 28, the Department for Work and Pensions (DWP) will raise the maximum amount that parents on Universal Credit can claim back monthly for their childcare costs.
The amount parents can claim back will rise to £951 for one child and £1,630 for two or more children.
This is up from the previous caps of £646 for one child or £1,108 for two or more children.
The 47% rise will give those eligible up to an extra £522 a month.
At the same time, the Government said it will also help eligible parents cover the costs of the first month’s childcare when they enter work or significantly increase their hours.
This move is designed to help those struggling to take on a job or getting into debt under the current system due to the hefty upfront costs.
Parents will also continue to receive up to 85% of their childcare costs back before next months bills are due - meaning they should have money to pay one month in advance going forward.
The extra childcare support for low-income households is worth a total of £900million.
Claire Coutinho, minister for children, families and wellbeing said: “Childcare shouldn’t be a barrier to work, but the expense has previously meant parents have had to choose between working or looking after their child.
“We are supporting families with the largest ever expansion of free childcare, making sure that places will be available for parents who need them. This will save a working parent using 30 hours a week an average of £6,500.
“We have already announced plans to boost the amount Government pays childcare providers, and now we’re knocking down barriers to recruiting and retaining the talented staff that provide such wonderful care for our children.”
The move was announced in the Spring Budget and is part of the Government's plan to get more people back into work and grow the economy.
The Government also unveiled a package of measures which would give new parents 15 free hours of childcare from when their baby is nine months to the start of school available from September 2024, rising to 30 free hours from September 2025.
