The doubling of free childcare to 30 hours is being rolled out by the Government across the country this year. But, it turns out, free may not mean entirely free.
So, what is the free childcare deal?
In a nutshell, many working parents of 3 to 4-year-olds in England will be eligible for 30 hours of free childcare - rather than the current 15 hours.
But the first thing you need to know is that the 30 hours is only free for 38 weeks per year - not 52 weeks of the year. It's basically equivalent to school term times. In theory, you may be able to spread the free childcare out over further weeks, but this will mean you'll get fewer than 30 hours free childcare each week.
When will it start?
The Government has been rolling out a pilot scheme in 8 English areas: Wigan, Staffordshire, Swindon, Portsmouth, Northumberland, York, Newham and Hertfordshire. The scheme is scheduled to go nationwide during 2017.
Will my child get it?
Not necessarily as not everyone is eligible. But everyone will still receive the 15 hours free childcare that is currently available.
Eligibility rules for 30 hours free childcare:
- Your child will be aged 3 or 4 when the scheme starts in your area
- Both parents must be working - or the sole parent is working in a lone parent family
- Each parent earns, on average, a weekly minimum equivalent to 16 hours at National Minimum Wage or National Living Wage
- Each parent must have an annual income of less than £100,000
How much is the equivalent of 16 hours at National Minimum Wage?
It depends on your age. For this scheme, the minimum amount will always reflect the lowest hourly rate that a person of your age can legally be paid. Therefore, currently for a parent aged 21-24, you'd need to earn a weekly average of at least £111.20. For a parent aged 25+, you'd need to earn a weekly average of at least £115.20.
What if one parent in a couple isn't working?
This is a scheme to help working parents, so families where one parent doesn't work, or both parents don't work, will usually not be eligible for these additional 15 hours.
However, if one parent isn't working because they're an official carer (eg receiving benefits relating to being a carer) or they are receiving disability benefits, and the other parent is working, then the Government has stated it "intends to make provision" to support these families.
There is also additional entitlement if the parent normally works but is temporarily away from the workplace, for example on statutory sick pay.
What if you are self-employed or on a zero hours contract?
You will be eligible if you (or both of you in a couple) earn at least the equivalent of 16 hours at the National Minimum Wage.
What if one parent loses their job?
There will be a short "grace period" - although this hasn't yet been defined - allowing parents to have a chance to find new employment.
How do you apply for the 30 hours free childcare?
You'll be able to apply for both the 30-hour scheme and the Tax-Free Childcare scheme through a joint online application being developed by HMRC. This is because the eligibility requirements for both schemes are aligned.
Will all nurseries offer this?
Most will - but some nurseries may not be able to offer the flexible 30 hours free childcare.
There has been a lot of concern within the nursery industry that the grant supplied by the Government is not enough to cover the costs of the current scheme.
According to educational charity the Pre-school Learning Alliance, the true cost to provide the childcare is typically £4.53 per hour. For the pilot schemes, the Government is allocating £4 an hour - an underfunding of 17%. (Initially, the Government had offered to pay £3.88 but this was increased after nursery providers in York battled for more funding).
Why free childcare doesn't necessarily mean free
As the first trials are rolling out, there's concern that free childcare won't be quite as free as first appears. Basically, if the money isn't coming from the Government, then the shortfall is likely to be paid for by us, the parents.
Charging for extras...
While nurseries can't charge for the 30 hours, they can charge for other 'extras' or ask for contributions. One nursery in York (one of the pilot areas) will be adding a new charge for food, whereas previously this had been included in the overall cost.
"I'm introducing a charge, which is something that was never there beforehand," one nursery owner in York told Radio 4's Today programme. "I'm now going to introduce a funded hours charge, which includes the meals which we've been providing, in a lot of cases totally for free."
Another York nursery is asking parents to pay £5 per day as a voluntary contribution.
Higher charges for babies and toddlers
Others may charge more for babies and under 2s, to subsidise the cost of the free childcare for the older children.
Parents who are getting completely free childcare may find that they can only secure a nursery place on a term-by-term basis. This means they may need to re-apply each term and may not be guaranteed the same days or place allocation each term. This lack of certainty could prove a headache for the majority of parents who don't have flexible work hours.
You probably know everything about the current childcare entitlement but just in case…
Currently, 3 and 4-year-old children are eligible for 570 hours of childcare a year – which is usually broken down to 15 hours each week over 38 weeks of the year:
· Nurseries and nursery classes
· Playgroups and pre-school
· Sure Start Children’s Centres
Depending on income levels, some 2-year-olds in England can get free early education and childcare. In order to get claim, you must be getting one of the following:
· Income Support
· Income-based Jobseeker’s Allowance (JSA)
· Income-related Employment and Support Allowance (ESA)
· Support through part 6 of the Immigration and Asylum Act
· Child Tax Credit and/or Working Tax Credit and have an annual income under £16,190
· The guaranteed element of State Pension Credit
· The Working Tax Credit 4-week run on (the payment you get when you stop qualifying for Working Tax Credit)
· Universal Credit