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Childcare improved in UC - but still problems
Childcare is helped in today’s budget but there are serious problems for those working more hours - or being pushed by DWP and the threat of sanctions, to work more hours. there will be some who may have to choose whether to pay much more than they earn or to face sanctions. See my blog at https://benefitsinthefuture.com/ for som charts and numbers.
Does anyone know when the childcare costs element in UC will be increased to £951/£1,630?
Uprating of UC is by SI so I’m presuming this isn’t going to come into force by the new financial year.
Latest Touchbase says ‘in the summer’.
Budget documents say the following:
This measure increases the Universal Credit childcare cost maximum amounts to £951 for one child and £1,630 for two children from July 2023 and increases them by CPI each year thereafter until 2027-28.
Thank you Charles - I missed that bit with the date!
A welcome increase to an element which seems to have not been increased since 2016 ?!
And do we know from when parents will be able to claim childcare costs up front ?
Are tax credits being deliberately left out from an increase in childcare costs to encourage people to claim UC?
And do we know from when parents will be able to claim childcare costs up front ?
In the policy costings document that accompanied the budget it says from Summer 2023:
Parents on Universal Credit in work can claim back 85% of their childcare costs. Currently this is paid in monthly arrears. This measure means parents on universal credit moving into work or increasing their hours can claim childcare costs upfront rather than in monthly arrears.
This measure will be effective from summer 2023.
There’s also now a written answer that confirms the exact figure for the July 2023 increase, including pence:
We understand that providing financial support with childcare costs to help parents back into work is crucial. That is why we will be significantly increasing the Universal Credit childcare element caps from £646.35 to £950.92 for one child and from £1,108.04 to £1,630.15 for two or more children.
https://questions-statements.parliament.uk/written-questions/detail/2023-03-13/163899
Are tax credits being deliberately left out from an increase in childcare costs to encourage people to claim UC?
Good point! the tax credits childcare costs help doesn’t seem to have been increased since 2005?
Are tax credits being deliberately left out from an increase in childcare costs to encourage people to claim UC?
I think it may also be because they have the power in UC to ensure the childcare costs are not excessive considering the extent to which the claimant’s are working. There is no such power within tax credits…