Budget 2023: Will Wales follow England and introduce free childcare for one and two-year-olds?

During yesterday's Budget, Jeremy Hunt announced he would introduce 30 free hours of childcare a week in England for parents with children over nine months.

The major expansion will see families across England access funded childcare from the time maternity care ends - when a baby reaches nine months of age.

The cost of childcare in the UK, deemed one of the most expensive systems in the world, was described as "career-ending" pressure on mothers in particular.

Responding to concerns the nursery sector will struggle to meet the increased demand, following a string of closures amid cost pressures, Mr Hunt said the government will increase funding paid to nurseries providing funded childcare.

The UK government had faced mounting pressure to do something on the issue with campaigners saying parents have been forced to leave the workplace because of the cost.

• How will it work?

Working parents of two-year-olds will be able to access 15 hours of funded care from April 2024, and that 15 hours will be extended to all children from 9 months up from September 2024.

From September 2025 every single working parent of under 5s will have access to 30 hours free childcare per week, Mr Hunt confirmed.

• What's happening in Wales?

Childcare is a devolved matter so the question remains on whether a similar scheme will be introduced in Wales.

At the moment, free provision in Wales and England is 30 hours a week for working parents of three or four year olds, unless a parent earns more than £100,000 a year.

But in Wales the offer is more generous as it parents can access it for 48 weeks of the year compared to 38 in England. 

To access the free hours, each parent must earn less than £100,000 a year, work the equivalent of 16 hours a week at the minimum wage or be enrolled in a higher education course.

The Welsh Government also offers free childcare - 12.5 hours - to some two-year-olds living in poorer areas of Wales.

As part of the co-operation agreement with Plaid Cymru, the aim is to expand it to all two-year-olds.

• How likely is it that Wales will follow England following the budget announcement?

Whenever spending increases or decreases from the UK Government in areas of health and education, the Barnett Formula determines how much money will go to the devolved nations.

There will be £180m directly for the Welsh Government and it is up to minister in Wales how that money is spent.

Finance minister Rebecca Evans criticised Jeremy Hunt's budget saying, "The UK Government does not have a grip on the bigger picture and is content to tinker around the edges.

"We will, of course, be considering how best to use the small amount of additional funding announced by the Chancellor, to meet the needs of Welsh people and priorities."

She told ITV News, "In Wales we spent a lot of time investing in childcare investing in skills and in the physical buildings to deliver our childcare offer. Obviously we'll be considering the implications in Wales and considering where we take our offer next, but we're already streets ahead on this."

Janine Gill from Little Inspirations nursery told ITV News they would "welcome" any incentive for families which means they can access high-quality childcare at an affordable price.

"What we'd welcome more though is consultation with Welsh Government be able to have our input and to be listened to", she added.

"There is a financial burden - we are privately run so we all have different overheads so a blanket cost wouldn't necessarily be a fair playing field.

"Private payers pay us in advance and funding pay us in arrears so as a small to medium business, I can imagine cash flow being a concern."

She also said physical spaces in buildings could become an issue if the rollout happens.

"We do cater for under twos but lots of settings register for two and up so if the new funding comes in for one-year-olds, there's going to be a lot of physical changes to be made for other people."

There is also pressure is coming from all political sides for childcare provision to be increased like it has in England.

The Welsh Conservative Shadow Minister for Social Services, Gareth Davies MS has said:

“Parents in England will benefit from expanded childcare support and while this is welcome, I want the same for hardworking parents along the length and breadth of Wales.

“Adopting this policy in Wales will support parents back into work and help reduce the rising economic inactivity presided over by successive Labour Governments in Cardiff Bay.

“I am calling on the Labour Government to allocate this new money to expand childcare in Wales, as opposed to letting these funds get sucked up into their ever-growing list of vanity projects.”

Meanwhile, the Welsh Liberal Democrats have stated Labour and Plaid Cymru’s current plans are not ambitious enough and fall short of what is needed.

Welsh Liberal Democrat Leader Jane Dodds said “Labour and Plaid Cymru’s childcare plans are simply not ambitious enough to move the dial for families in Wales.

“Childcare costs are one of the most pressing issues facing families up and down Wales right now and it is holding our economy back by keeping parents out of the workforce because for many families it is more cost-effective for a parent to stay at home than return to work.  

“The Welsh Liberal Democrats have called for and will continue to call for free part-time childcare from 9 months for all parents regardless of work status.”

A spokesperson for Plaid Cymru said: "The creation of a national childcare service offering 30 hours of high quality childcare from 12 months has been Plaid Cymru policy for some time and was a key election pledge for Plaid Cymru in 2021."Wales is on the front foot thanks to Plaid Cymru's co-operation agreement where free childcare is already being expanded for all two year olds."We need full consequential funding as soon as possible to continue with the expansion that is already in place in Wales, ensuring that it's a service that meets the needs of the people of Wales and delivers in all communities.”

In an interview with Wales at Six, Natasha Davies from Chwarae Teg, a charity which campaigns for gender equality, said they "absolutely" want to see any additional money that comes to Wales from the budget to be spent going "further and faster with the rollout of childcare expansion."

"We made a start with the expansion of the Flying Start scheme, but we want to see expansion of childcare happen as quickly as possible towards a long term goal of free universal provision."

She said the outcome for the economy would be "quite significant".

"We did research which suggested increased gender quality could add over £13bn to Wales' economy and part of that would be supporting more women into work and we know that access to affordable high quality childcare is a way of achieving those outcomes and realising the economic benefit."

Ms Davies added childcare was a "big part of the solution but not an entire solution" and said more can be done about how flexible employers are when it comes to supporting women and parents.

"A lot can be done about how we structure work - how flexible it is, embracing new ways of working, hybrid, remote technology, there can't be a one-size fits all approach. Everybody's life and circumstances will be different, so having ways of working that will be truly flexible and give autonomy and agency to employers will be really important."

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