The Government recognises that childcare is a significant expense for many families, and we remain committed to ensuring that parents can access affordable, high‑quality provision that supports them to work and provide for their children.

At Autumn Budget 2025, the Government announced that the Department for Education will lead a review of childcare provision. The aim of this review is to simplify the system for both providers and families, making it easier to access support and enhancing the overall impact of the Government’s childcare offer.

HMRC does not hold this information. Many families who lose eligibility for Tax-Free Childcare as a result of their income exceeding the £100,000 threshold will simply choose not to re-apply for the scheme, and are not required to report this to HMRC.

The £100,000 adjusted net income per year threshold applies to the working-parent entitlement and Tax-Free Childcare, rather than to all forms of government childcare support. Children aged three-and-four years old who were ineligible for the working parent entitlement due to the £100,000 threshold would have still been able to access 15 hours of childcare support through the 15-hour universal childcare entitlement.

We are able to release estimates of the number of children ineligible for working parent funded childcare entitlements, because of a parent exceeding the £100,000

threshold.

The following caveats should be noted for this analysis:

• Ranges are presented to account for uncertainty around whether or not both parents are working, making the child ineligible for reasons other than just the £100,000 threshold.
• The value of hours are calculated assuming 100% take-up of the eligible population (a phenomenon we do not observe with the working parent entitlement currently), and maximum use of hours available i.e. all 30 hours of the 30 hours offer (a phenomenon we also do not observe currently).
• The Working Parent Entitlement was expanded in September 2024 to cover children aged 9 months to 2 years, hence the sudden increase in ineligible children over that period.

Within the personal tax system, withdrawal of the Personal Allowance affects those with income over £100,000 a year. This was introduced in 2010/11 and occurs gradually, with £1 of allowance lost for every £2 of income above the income limit of £100,000. This reduction continues until the Personal Allowance is completely withdrawn for those with incomes above £125,140.

The Government recognises that because of this, taxpayers with incomes within the taper band face a higher marginal tax rate, and that it introduces some complexity into the tax system. However, removing this would be expensive and regressive.

Further, the Government recognises that childcare is a significant expense for many families, and we remain committed to ensuring that parents can access affordable, high quality provision that supports them to work and provide for their children. The offer targets parents for whom childcare support makes the biggest difference to their ability to work, as childcare costs account for a bigger proportion of their earnings.

At Autumn Budget 2025, the Government announced that the Department for Education will lead a review of childcare provision. The aim of this review is to simplify the system for both providers and families, making it easier to access support and enhancing the overall impact of the Government’s childcare offer.

The government is committed to improving access to holiday provision for school-aged children. Families can receive support with costs through Tax-Free Childcare, Universal Credit childcare and the Flexible Support Fund.

Through the holiday activities and food programme, we are investing over £600 million across 2026/27 to 2028/29 to provide free holiday club places, healthy meals and enriching activities for eligible children during school holidays in England.

We are also providing local authorities with £12.9 million in 2026/27, to support their statutory duty to secure sufficient childcare. As part of this duty, local authorities ensure they understand supply and demand for school-age childcare, including paid holiday provision. It is clear in published guidance that holiday childcare includes inset days.

Backed by £400 million capital investment, the school-based nursery programme will deliver tens of thousands of new places by expanding early education and childcare places where it is most needed. This will help more families access funded childcare and give children the best start in life.

The department has already made an impact, awarding £82 million in capital funding to more than 600 primary and maintained nursery schools, which is expected to deliver over 11,000 new nursery places by September 2027. This includes 3 schools in Fylde: Clifton Primary School, Singleton Church of England Voluntary Aided Primary School, and Treales Church of England Primary School.

Schools report that by the end of September 2026 450 new and expanded nurseries will have created over 9,000 new places since the start of the programme.

Local authorities have until 5pm on 30 September 2026 to submit their funding proposals for phase 3.

Students who work alongside their studies may be eligible for 30 hours free childcare if they meet the income requirements. PhD stipends are non-taxable income and therefore do not count towards the income requirements of the 30 hours childcare entitlement.

The department does not hold information on the number of PhD researchers who have withdrawn from, or have been unable to commence, PhD study as a result of childcare costs. The department has not estimated the potential cost to the public purse of allowing PhD stipends to count towards the work and income requirements for the 30 hours free childcare entitlement.

The government recognises that experiences during the critical 1,001 days from conception to age two lay important foundations for children’s health, development and future learning.

Best Start Family Hubs and ‘Healthy Babies’ provide a community-based, prevention-led model that brings together health, parenting and early years support, helping families access services earlier and supporting early identification and intervention.

They help parents and carers build confidence and strengthen the home learning environment through chatting, playing and reading, supporting children’s language, communication and readiness to learn. These universal activities complement evidence-based parenting and home learning interventions, evaluations of which show positive impacts. The department does not currently hold a separate assessment of the educational impact of baby groups alone.

The department will monitor and evaluate delivery to strengthen the evidence on its longer-term impact. Baby groups, including stay-and-play, story and rhyme sessions and play-based early language activities, form part of the wider Best Start Family Hub offer.

It is our ambition that all families have access to high-quality, affordable and flexible early education and care, giving every child the best start in life and delivering on our Plan for Change.

The government recognises the value of parents continuing in education and provides a range of support for students in higher education to assist them with childcare.

The postgraduate master’s loan scheme and doctoral loans are available to help remove the financial barrier often faced by those wishing to step up to achieving a postgraduate qualification. These loans are not based on income and are intended as a contribution to the cost of study. They can be used by students according to their personal circumstances to cover the costs of fees and living costs including childcare.

It is our ambition that all families have access to high-quality, affordable and flexible early education and care, giving every child the best start in life and delivering on our Plan for Change.

The government recognises the value of parents continuing in education and provides a range of support for students in higher education to assist them with childcare.

The postgraduate master’s loan scheme and doctoral loans are available to help remove the financial barrier often faced by those wishing to step up to achieving a postgraduate qualification. These loans are not based on income and are intended as a contribution to the cost of study. They can be used by students according to their personal circumstances to cover the costs of fees and living costs including childcare.

The government recognises that experiences during the critical 1,001 days from conception to age two lay important foundations for children’s health, development and future learning.

Best Start Family Hubs and ‘Healthy Babies’ provide a community-based, prevention-led model that brings together health, parenting and early years support, helping families access services earlier and supporting early identification and intervention.

They help parents and carers build confidence and strengthen the home learning environment through chatting, playing and reading, supporting children’s language, communication and readiness to learn. These universal activities complement evidence-based parenting and home learning interventions, evaluations of which show positive impacts. The department does not currently hold a separate assessment of the educational impact of baby groups alone.

The department will monitor and evaluate delivery to strengthen the evidence on its longer-term impact. Baby groups, including stay-and-play, story and rhyme sessions and play-based early language activities, form part of the wider Best Start Family Hub offer.

Best Start Family Hubs and Healthy Babies will be a core component of Neighbourhood Health for babies, children and their families.

The programme will bring early years, health and family support together through a network of up to 1,000 hubs and 2,000 network sites in every local authority in England by the end of 2028. Healthy Babies services, including maternity, health visiting, infant feeding, perinatal mental health and parent-infant relationship support, will sit at the heart of this offer.

Local authorities and health partners will develop joined-up pathways from pregnancy onwards and explore opportunities to co-locate services in Best Start Family Hubs, Neighbourhood Health Centres, GP settings and trusted community venues. This will help families access early years support, parenting and home learning services, and early support for children with additional needs, closer to home and through a more preventative, joined-up model.

We recognise that access to childcare support is essential in enabling parents to move into or progress in employment.

Eligible UC customers can claim back up to 85% of their eligible childcare costs each month regardless of the number of hours they work. Childcare costs can be claimed up to three months in advance but will be reimbursed in the month the childcare is provided. Parents who need help with their upfront childcare costs to move into work or increase their working hours may be eligible for support from the Flexible Support Fund (FSF).

We are investing over £1 billion more in the early years entitlements this year compared to 2025/26 and an above inflation increase to entitlements funding rates. In 2026/27, we expect to provide over £9.5 billion for the early years entitlements. Coram–PACEY’s 2026 Childcare Survey found that the expansion of 30 hours of funded childcare significantly reduced costs for eligible working parents in England, in some cases making part time childcare effectively free during term time. In addition to funding increases, we are committing to consult on changes to how early years funding is allocated and distributed as part of the ongoing review of childcare provision and regulation.

By allowing funded hours to be stretched across the year, deducting closures from calculations, and enabling mixed‑provider models, the system is designed to work alongside all‑year childcare businesses, managing funding and fees transparently and within national limits, broadening parental choice.

We continue to monitor the sufficiency of childcare places; the key measure being the supply of available places is sufficient to meet requirements.

Section 6 of the Childcare Act 2006 states local authorities are responsible for ensuring that the provision of childcare is sufficient in their area.

The department is committed to ensuring that all children have the best possible start in life and is committed to improving school readiness with a clear ambition for 75% of children to reach a good level of development by 2028.

Support for parenting and the home learning environment is central to this, as what happens at home has the biggest impact on a child’s life chances. We are supporting families of children aged 0–5 to build strong foundations for development through everyday interactions such as talking, playing and reading.

To deliver this, Best Start Family Hubs have been expanded nationally, with a hub now available in every local authority area, making it easier for families to access universal support close to home.

Further, the government is rolling out universal childcare entitlements, helping more families access high-quality early education and childcare while supporting children’s learning and development before they start school.

​As the last government set out when announcing the expansion of government funded childcare in 2023, this aimed to tackle the fact that ‘the employment rate and hours worked by parents, particularly mothers, drops after childbirth and persists until after their children reach school age’.

Access to childcare continues to be a key factor in helping parents to work. Official statistics from the 2025 Childcare and Early Years Parent survey highlight that around two thirds (66%) of mothers in families with children aged 0 to 4 years said that having reliable childcare helped them to work, and that in the absence of the working parents offer for 9 months to 2 year olds, 40% in receipt of the offer said that they would be working fewer hours.

However, we know that many of those who need and benefit from early education and childcare miss out. Children who attend high-quality early education and childcare between ages 2 and 4 on average perform better at every stage of school, with children from low-income families benefiting the most. Nearly 1.5 million children aged 9 months to school age are excluded from the full 30-hour entitlement because their parents do not meet the eligibility rules. Children in lower income areas face both fewer childcare places and fewer high-quality providers on their doorstep. Childcare is a key barrier to those on low incomes working more, with a disproportionate impact on women.

This is why the department is leading an Early Education and Childcare Review to improve the system so that it is simpler, fairer and focused on children, ensuring support reaches the families who need it most. Through this, as the former Secretary of State for Education set out, universal childcare is something towards which we should build.

​As the last government set out when announcing the expansion of government funded childcare in 2023, this aimed to tackle the fact that ‘the employment rate and hours worked by parents, particularly mothers, drops after childbirth and persists until after their children reach school age’.

Access to childcare continues to be a key factor in helping parents to work. Official statistics from the 2025 Childcare and Early Years Parent survey highlight that around two thirds (66%) of mothers in families with children aged 0 to 4 years said that having reliable childcare helped them to work, and that in the absence of the working parents offer for 9 months to 2 year olds, 40% in receipt of the offer said that they would be working fewer hours.

However, we know that many of those who need and benefit from early education and childcare miss out. Children who attend high-quality early education and childcare between ages 2 and 4 on average perform better at every stage of school, with children from low-income families benefiting the most. Nearly 1.5 million children aged 9 months to school age are excluded from the full 30-hour entitlement because their parents do not meet the eligibility rules. Children in lower income areas face both fewer childcare places and fewer high-quality providers on their doorstep. Childcare is a key barrier to those on low incomes working more, with a disproportionate impact on women.

This is why the department is leading an Early Education and Childcare Review to improve the system so that it is simpler, fairer and focused on children, ensuring support reaches the families who need it most. Through this, as the former Secretary of State for Education set out, universal childcare is something towards which we should build.