Jeremy Hunt to vastly increase the number of places available at nurseries in England

Parents of one- and two-year-olds in England will be entitled to 30 hours of free childcare a week under an expected £4 billion handout in Wednesday’s Budget.

The major expansion of early years entitlements is part of a series of childcare measures to be announced by Chancellor Jeremy Hunt. It is also likely to increase funding for the sites, according to people close to the discussions.

The drive to make childcare more affordable and accessible comes as Hunt seeks to reverse the rise in inactivity by making it easier for parents to work.

Currently, parents of three- and four-year-olds can request 15 or 30 hours of free childcare per week during the education period, but this entitlement is not generally available for younger children.

According to the plans first reported by The Guardian, the right will be extended to parents of one- and two-year-olds. However, it remains to be seen at what pace the expansion will take place, or whether funding will be reallocated from other areas of early years spending.

The government is also increasing the support kindergartens receive for free hours, allaying the concerns of service providers that the amount received per hour falls far short of their costs.

Research the Early Years Alliance, a trade body, found that in 2021 the government gave nurseries around £4.90 for each hour they were funded, despite estimates it would cost around £7.50 per child per hour to provide care.

EYA chief Neil Leitch said underfunding had brought the system “to its knees”. While the £4 billion commitment sounded “impressive”, he said “the devil is in the details” and that the expansion would be unsustainable if the government did not significantly increase hourly funding.

If the money for more places does not match the “steeply rising” costs of service providers, then “what is currently a crisis will end in disaster,” he added.

Service providers have previously called for a complete overhaul of the free working time system, which Labor has committed to if it wins the next election.

People close to the talks said the government would spend an extra £200m on existing hourly rates in 2023-24, bringing the figure to close to £300m the following year.

The increase adds up to around £4bn of funding in 2021-2022, an increase of around 5 per cent next year.

The government is also offering new self-employed childminders a bonus of £500 or £1,000 if they join through an agency, and easing ratio rules to allow one adult to look after five two-year-olds instead of four under-threes. currently.

Hunt announced on Sunday that he would reform the Universal Credit system so that parents can claim Childcare Grant up front instead of afterwards. It increases the claimable limit from £646 to £950 for one child, and more for two children.

The Ministry of Finance declined to comment.