Coalition to boost childcare pot by £300m to target low-earning women

As support from working women falls, the coalition acts by giving 80,000 extra families childcare help for the first time The coalition has responded to growing poll pressure to improve its standing among women by announcing an extra £300m to help with childcare costs when the universal credit starts in 2013. Writing in the Guardian, Iain Duncan Smith, the work and pensions secretary, claims the reforms “will mean more women will be able to take steps towards employment, more parents can work part-time, or full-time, and their children will grow up in a family where their parents are positively contributing to society and growth in the economy”. The extra £300m funding will cover the cost of making childcare available for the first time to the 80,000 women who currently do not receive help because they work 16 hours a week or less. If the extra cash had not been found to add to the £2bn childcare pot set aside by government, then the decision to help women working 16 hours or less would have reduced the money available for those working longer hours. Low-income working women suffered a big cut in childcare support in April following the government’s decision to reduce funding from 80% to 70% of childcare costs. Poorer families now will be able to recover childcare costs at 70% of the cost – up to £175 a week for one child, or £300 for two or more children. Childcare costs have been spiralling, especially in south-east England, and are viewed as the most expensive in Europe. In a sign of the measure’s political importance to both wings of the coalition, Nick Clegg and Duncan Smith announced the extra £300m together. Both parties have been struck by polling showing they are fast losing support among low-income working women, a tranche of the population that helped Cameron to power. Polling by Ipsos Mori, for the Resolution Foundation, shows the Tory rating with female C2 voters has fallen by seven points since the election. The Lib Demeral Democrats had a 14-point drop among the same group. Clegg said: “This will help an extra 80,000 families who have previously had no help at all with childcare costs. We all know how difficult it is sometimes to juggle family and work but this is really good news, especially for lone parents and mums up and down the country. Duncan Smith said: “I want to see far more than 80,000 benefit. Because at the moment for many parents it’s just not worth working less than 16 hours, so I see the 80,000 very much as a starting point. “Under this new model, payment will be calculated by months, not weeks, so that when the rush of the school holidays descend, these higher-cost weeks are balanced by the lower cost of others. It’s about having a system that works for the people that use it, not those designing it.” Clegg and Duncan Smith have been lobbied intensively through the summer by groups including Save the Children, the Daycare Trust, and the Resolution Foundation, which have been urging the pair to acknowledge that they would have to pump more money into childcare to expand its availability to those working 16 hours or less. If no extra cash had been found, Clegg and Duncan Smith would have been forced to cut the cap of weekly cash. Ministers were considering either allowing parents to claim 70% of their childcare costs, only up to £125 for one child and £210 for two or more children; or of claiming 80% of costs, up to £100 for one child or £150 for two or more children. Vidhya Alakeson, director of Research at the Resolution Foundation, said: “The good news is that more parents working part-time will be eligible for support, and others already receiving it won’t face further cuts. The bad news is the misguided cuts made in April – which lost half a million working parents around £450 each – haven’t been reversed.” The shadow work and pension secretary, Liam Byrne, said: “The new money will simply plug a black hole in childcare funding which emerges in two years’ time when eligibility for childcare is widened. “Today’s funding does nothing to make up for the new parents’ penalty introduced over the last year.” Childcare Children Patrick Wintour guardian.co.uk

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