Millions of working families on Universal Credit will receive a £522 monthly boost from today.

The extra money from the Department for Work and Pensions (DWP) will help cover childcare costs, making it easier for them to get back to work or increase their hours.

The DWP has raised how much parents on Universal Credit can claim for childcare – up to £951 a month for one child and £1,630 for two or more children. This is an increase of 47% from the previous limits, which were £646 for one child or £1,108 for two or more children.

The Government is also helping eligible parents cover the costs for the first month of childcare when they enter work or increase their hours.


Those parents will now receive up to 85% of those childcare costs back before their next month’s bills are due – meaning they should have money to pay one month in advance going forward.

Mel Stride, Secretary of State for Work and Pensions, said: “We are supporting thousands of parents to return to work, progress their careers and boost their finances while making sure they have affordable childcare.

“By removing one of the biggest barriers to work for parents in Britain we are giving families the chance of a better future while doubling down on this government’s pledge to grow the economy and bear down on inflation.”

In addition, the hourly rates paid to providers to deliver the Government’s free childcare offer for two-year-olds will increase by 30% in September, up to an average rate of £8.

Minister for Children, Families and Wellbeing Claire Coutinho said: “We are delivering the largest ever expansion of free early education in England to make sure parents are able to access the high-quality, affordable childcare that they need.

“A working parent using 30 hours of childcare a week could save an average of £6,500 a year thanks to the new free hours offer alone.

“Parents might be surprised just how much support they’re eligible for – check all the details on our dedicated Childcare Choices website.”