Select Committee · Work and Pensions Committee

Universal Credit and childcare costs

Status: Closed Opened: 25 Nov 2021 Closed: 24 Jul 2023 8 recommendations 6 conclusions 1 report

The Committee looked into how well Universal Credit supports parents with childcare costs. We focussed on: • The requirement for parents to cover childcare costs upfront. • The maximum amounts that the Government will reimburse each month. • How easy it is for parents to get advice about what support they can claim for. Read …

Clear

Reports

1 report
Title HC No. Published Items Response
Fourth Report - Universal Credit and childcare costs HC 127 20 Dec 2022 14 Responded

Recommendations & Conclusions

4 items
3 Recommendation Fourth Report - Universal Credit and ch… Acknowledged

Households claiming Universal Credit are, by definition, amongst the poorest households in the country, yet...

Households claiming Universal Credit are, by definition, amongst the poorest households in the country, yet the childcare support to them via that system requires them to find substantial sums to meet up-front costs: both initially and on an ongoing basis. Other schemes, such as Tax Free Childcare, allow reimbursement in …

Government response. The Department works closely with other government departments, especially with DfE to look at ways to support parents back in to work and progress in work. By September 2025, eligible working parents of children aged 9 months to when they …
Department for Work and Pensions
6 Conclusion Fourth Report - Universal Credit and ch… Acknowledged

DWP maintains that it does not collect or publish regular statistical updates on uses of...

DWP maintains that it does not collect or publish regular statistical updates on uses of the Flexible Support Fund, on the basis that it does not want to detract from its discretionary nature. The FSF is a core element of support for working parents, and without this data, the Department …

Government response. The Government recognises that high childcare costs can be a barrier for parents to take up paid work and is increasing the UC childcare maximum amounts (caps) of childcare costs payable to eligible UC claimants, with a provisional implementation date …
Department for Work and Pensions
8 Conclusion Fourth Report - Universal Credit and ch… Acknowledged

There are a wide range of childcare support schemes available to people claiming Universal Credit,...

There are a wide range of childcare support schemes available to people claiming Universal Credit, all with different eligibility criteria and application systems. We heard in this inquiry that it continues to be very difficult for parents to understand what the best childcare option for them is, and how this …

Government response. The government acknowledges the difficulty for parents to understand childcare options, and states that the awareness campaign continues and there is a wide variety of information that covers all the Government childcare offers on the Childcare Choice website. The government …
Department for Work and Pensions
12 Conclusion Fourth Report - Universal Credit and ch… Acknowledged

It is evident that the current system for receiving childcare reimbursements is failing those on...

It is evident that the current system for receiving childcare reimbursements is failing those on Universal Credit, and often leads to further debt and/or compromising circumstances. Variable childcare costs are unfortunately unavoidable due to differing costs during term time and out of term, but the Government and childcare providers can …

Government response. The government recognizes that high childcare costs can be a real barrier to parents taking up employment or increasing their working hours and shares some of the concerns that the Committee highlights.
Department for Work and Pensions

Oral evidence sessions

3 sessions
Date Witnesses
20 Apr 2022 David Rutley MP · Foreign, Commonwealth & Development Office, Donna Ward · Department for Work and Pensions, Mims Davies MP · Department for Work and Pensions, Neil Couling · Department for Work and Pensions View ↗
2 Mar 2022 Annabel Denham · Institute of Economic Affairs, Aria Babu · The Entrepreneurs Network, Gavin Rice · Centre for Social Justice, Gemma Widdowfield, Nichola Salvato, Vikki Waterman View ↗
26 Jan 2022 Ceri Smith · Department for International Trade, Charlotte McDonagh · Save the Children UK, Dr Rita Griffiths · Institute for Policy Research, University of Bath, Helen Donohoe · Professional Association for Childcare and Early Years, Jonathan Broadbery · National Day Nurseries Association, Oliver Crunden · Citizen’s Advice View ↗

Correspondence

4 letters
DateDirectionTitle
23 Feb 2023 Correspondence to Secretary of State relating to the Universal Credit and child…
9 Feb 2023 Correspondence from the Minister for Employment on Flexible Support Fund expend…
6 Jul 2022 Correspondence with the Minister for Welfare Delivery and the Minister for Empl…
21 Apr 2022 Correspondence with the Minister for Welfare Delivery relating to the Universal…