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Childcare 'the issue' for families
Prime Minister David Cameron has announced an expansion in support which could help more than two million families
David Cameron has said childcare is "the issue" for families as ministers announced a major expansion of government support which could benefit more than two million working families.
Under tax-free plans, set out on the eve of the Budget, eligible families will receive up to £1,200 a year towards care for each child - up to a maximum of 20% of their annual costs.
After meeting parents at the Wandsworth Day Nursery in south London with his deputy, Nick Clegg, the Prime Minister said: "For many families the cost of childcare is not one issue among many, it is the issue - it really matters.
"We want to help people who work hard and want to get on, and so effectively this is some tax relief on childcare.
"It could be £1,200 per child, per family, and I think that's a real help to people who want to go out to work and want good childcare for their children. So I'm delighted to be able to make this announcement."
The new scheme, which will replace the existing employer- supported childcare programme (ESC), will not come into effect until late 2015 - after the next general election.
In order to qualify, both parents will have to be in work - or the one parent in the case of lone parent families - and each parent must be earning less than £150,000 a year.
Initially it will cover children up to five years old, but will build up "over time" to include children under 12. Ministers say that, to start with, 1.3 million families will benefit - compared with 450,000 under ESC - eventually rising to around 2.5 million.
Deputy Prime Minister Mr Clegg said: "I've lost count of the number of parents who tell me that, because of high childcare costs, they just don't think it's worth going out to work, and this is all about trying to help them.
"Basically trying to give them a bit of extra help - 20% off their childcare costs, up to a certain limit - so that it pays to go out to work, because there are so many parents who want to actually mix work and family but feel at the moment it just makes no sense to do so. I hope that this, when it starts in 2015, will make a big, big difference to those parents who presently just don't think it's worth working."