Question to the HM Treasury:

To ask Her Majesty's Government, further to the Written Answer by the Chief Secretary to the Treasury on 19 November (75071), what proportion of the £2.4 billion underspend on tax-free childcare since 2017 has been reinvested in other childcare and early education services.

We have spent over £3.5 billion in each of the past three years on our early education entitlements and the government continues to support families with their childcare costs. The universal 15 hours entitlement, available for every three and four year old, can save parents up to £2,500 per year, and eligible working parents can apply for an additional 15 hours free childcare which can save them up to £5,000 if they use the full 30 hours. 30 hours free childcare was introduced in England in September 2017 and is an entitlement for working parents of three and four year olds, benefitting nearly 330,000 children in January 2021.

In addition to the free early education entitlements, the government offers Tax-Free Childcare for children from 0-11 years old, or up to 16 if disabled. This scheme means that for every £8 parents pay their provider via an online account, the government will pay £2 – up to a maximum contribution of £2,000 per child each year, or £4,000 if disabled. 308,000 families used Tax-Free Childcare for 364,000 children in June 2021.

Parents may also benefit from Universal Credit. Working parents on a low income can get up to 85% of their childcare costs for children under 16 reimbursed through Universal Credit Childcare. This is subject to a monthly limit of £646 for one child or £1,108 for two or more children, payable in arrears.

At SR21, the Government announced a £160 million investment for 2022-23, for local authorities to increase the hourly rate to be paid to early years providers.