Education Minister Liz Truss has promised that the Government will deliver proposed childcare plans "as fast as we can".
Speaking to Daybreak she said the Government will need until 2015 to get the new systems will be in place.
She added: "We spend £5 billion on childcare, at the moment not enough money is going through the frontline."
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The new measures would mirror childcare vouchers and see workers sacrifice some of their salary to benefit.
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Staffing levels and worsening pay are to blame, according to the report by the Health Foundation.