Parents receive hundreds of pounds to help with childcare costs

Chancellor Jeremy Hunt is expected to announce an increase in support for low-income families and change Universal Credit rules so that families receive child care benefits upfront, rather than being reimbursed.

Mr Hunt will increase the amount parents can claim on Universal Credit for childcare from £646 a month for a single child to £950 and from £1,108 to £1,630 for two children, the Sunday Times reports.

He is also considering extending 30 free hours of childcare during school hours to parents with children aged one and two.

Only eligible parents of three- and four-year-olds are currently eligible.

The extra help for childcare costs comes after an outcry from the local government. Councils across England have joined calls for more support amid fears just 13 per cent of parents are demanding the falling support they are entitled to.

Mr Hunt wants to change the rules on staff-to-child ratios in nurseries to make childcare “more flexible and affordable” for families.

The Chancellor’s ‘back to work’ budget also hopes to appeal to a record nine million working-age Britons who are economically inactive.

He will set out plans to encourage those over 50 to return to work by expanding the range of skills available.

Mr Hunt will also abolish the sickness benefit assessment system. The reform means claimants can receive the payments even after they return to work.

Mr Hunt said: “For many people there are barriers that prevent them from getting a job – a lack of skills, a disability or health condition, or a long absence from the labor market.

“I want this back-to-work budget to break down those barriers and help people find jobs that are right for them.

“We need to close the skills gap and give people the skills, support and incentives they need to get work. With this plan, we can address labor shortages, bring down inflation and put Britain back on the growth path.”