Families are to receive up to £1,200 a year towards childcare costs from 2015. The pledge will reportedly only apply to families in which both parents work and earn less than £150,000 a year. The Budget will be announced on Wednesday.
The Government's £1,200 childcare cost pledge will benefit many working families but leave others worse off, a leading think tank has claimed.
Harriet Waldegrave, education research fellow at Policy Exchange, said low income working families would see their childcare costs halved by the new measure.
This will be a huge help to those on the tightest budgets, and may free them up to choose care based on what they think is best for their child rather than what is cheapest.
There will, however, be some losers. A family with two working parents and one child will be worse off. If only one parent works, the family will not be able to get any support (unlike at present where the working parent can get vouchers), so it will be important to consider what this means for those families, for example, where one parent is in further education or training.
The delay until 2015 of the Government's new funding for childcare "helps no one", the head of the single parents charity Gingerbread has said.
Chief executive Fiona Weir said the charity was "very pleased" to see help for those on low and middle incomes, while urging more to go to those earning less, but attacked the timing.
Two to three years is a long time to wait for measures that the Government itself says could offer a £4 billion boost to the economy each year. Work is single parents' best route out of poverty and the most effective way for the Government to cut the welfare bill; this delay helps no one.
I've lost count of the number of parents who tell me that, because of high childcare costs, they just don't think it's worth going out to work, and this is all about trying to help them.
Basically trying to give them a bit of extra help - 20% off their childcare costs, up to a certain limit - so that it pays to go out to work, because there are so many parents who want to actually mix work and family but feel at the moment it just makes no sense to do so.
I hope that this, when it starts in 2015, will make a big, big difference to those parents who presently just don't think it's worth working.