A major change is being made to Universal Credit rules which means thousands of working parents will get extra money from this week.
The amount parents can claim back monthly for their childcare costs on Universal Credit will go up from £646 to £951 for one child - a rise of £305 - and from £1,108 to £1,630 - a rise of £522 - for two or more children. The new amounts come into effect from June 28, with the Government describing it as its "biggest expansion to childcare provision".
Eligible parents who return to work or significantly increase their hours will be able to get up to 85% of their childcare costs back before their next month's bills are due. This means they can use that money to pay one month in advance going forward.
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In the past, childcare costs have always been given back later, meaning parents on low incomes would have to find hundreds of pounds upfront to pay childcare providers and then ask the Department for Work and Pensions to refund the money. Many parents have been unable to find these upfront costs from their limited resources, reports Birmingham Live.
But the new changes mean most of the initial childcare bill is paid back straight away by the Government, giving parents cash in their accounts to pay for the following month in advance. 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."
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