Targeted childcare entitlement#

Official government guidance | Legislation

Program description#

Overview#

The targeted childcare entitlement (also known as the 2-year-old offer) provides 15 hours of free childcare per week for eligible 2-year-old children. The entitlement totals 570 hours annually and it delivered across 38 weeks. This program specifically targets families who meet certain income or benefit criteria.

Eligibility requirements#

Age criteria#

Children must be exactly 2 years old - not younger or older. Once a child turns 3, they transition to the universal or extended childcare entitlement programs.

Benefit-based eligibility#

Families qualify if they receive any of these benefits:

  • Income Support

  • Income-based Jobseeker’s Allowance (JSA)

  • Income-related Employment and Support Allowance (ESA)

  • Pension Credit (Guarantee Credit)

Eligibility conditions#

Families may also qualify based on income thresholds if they receive:

  • Universal Credit with household earned income of £15,400 or less per year

  • Tax Credits (Working Tax Credit or Child Tax Credit) with household income of £16,190 or less per year

Geographic scope#

The program applies only to families living in England. Scotland, Wales, and Northern Ireland administer their own early education systems.

Implementation#

The targeted childcare entitlement program is implemented through several interconnected components:

1. Parameter definition#

Located in parameters/gov/dfe/targeted_childcare_entitlement/, key parameters include:

2. Benefit-based eligibility assessment#

Managed in targeted_childcare_entitlement_eligible.py:

  • Checks if family resides in England

  • Verifies receipt of qualifying benefits defined in qualifying_benefits.yaml

  • References additional qualifying criteria for means-tested benefits

Example table:

Benefit type

Receiving benefit

Meets criteria

Is eligible

Income Support

Yes

N/A

Yes

JSA (income-based)

Yes

N/A

Yes

ESA (income-related)

Yes

N/A

Yes

Pension Credit (Guarantee)

Yes

N/A

Yes

Universal Credit

Yes

No

No

Tax Credits

Yes

No

No

None

No

N/A

No

3. Benefit eligibility#

Benefit eligibility is implemented in separate files for different benefit programs:

Universal Credit criteria#

Universal Credit criteria is handled by meets_universal_credit_criteria_for_targeted_childcare_entitlement.py:

  • Verifies UC receipt by checking if benefit amount is greater than zero

  • Compares earned income against £15,400 threshold

  • Returns boolean eligibility determination

Example table:

Universal Credit amount

Earned income

Below £15,400 threshold

Meets UC criteria

£500

£14,000

Yes

Yes

£300

£16,000

No

No

£0

£10,000

Yes

No

Tax Credits criteria#

Managed by meets_tax_credit_criteria_for_targeted_childcare_entitlement.py:

  • Checks for either Child Tax Credit or Working Tax Credit receipt

  • Compares applicable income against £16,190 threshold

  • Returns boolean eligibility determination

Example table:

Tax Credit type

Credit amount

Applicable income

Below £16,190 threshold

Meets TC criteria

Child Tax Credit

£2,000

£15,000

Yes

Yes

Working Tax Credit

£1,000

£16,500

No

No

Both

£3,000

£14,000

Yes

Yes

None

£0

£10,000

Yes

No

4. Entitlement calculation#

Final calculation in targeted_childcare_entitlement.py:

  • Checks if child’s age is exactly 2 years using age_eligibility parameter

  • Applies entitlement hours (570 annually) for eligible children

  • Multiplies by appropriate funding rate based on age (£8.28 per hour for 2-year-olds in 2024)

  • Returns final annual entitlement amount

Example table:

Child age

Eligible

Hours entitlement

Hourly rate

Annual entitlement

1

No

0

£11.22

£0

2

Yes

570

£8.28

£4,719.60

3

No

0

£5.88

£0

4

No

0

£5.88

£0