Britain's finance minister Jeremy Hunt has announced that most working parents in the UK will be offered 30 hours of free childcare per week for children under five, to ease the financial burden of the cost-of-living crisis.

The policy is part of the government's tax and spending plans unveiled in its 2023 budget on Wednesday and will eventually apply for 38 weeks of the year, from when a child is nine months old until they start school aged around five.

It comes alongside a host of childcare measures aimed at encouraging more women back into the workplace – or to remain working – after having children, while better funding the sector.

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Childcare costs in the UK are among the highest in the 38-nation Organisation for Economic Cooperation and Development (OECD), accounting for nearly a third (29 percent) of a family's income compared to just nine percent in France. 

"We have one of the most expensive systems in the world," Hunt told MPs as he delivered his budget in parliament. 

"For many women, a career break becomes a career end," he added, noting almost half of non-working mothers said they would prefer to work if they could arrange suitable childcare.

Here's a summary of the key points of the UK's 2023 budget.

UK childcare measures

• The new 30-hours provision will be rolled out in stages and brings it into line with Scotland and Wales, where childcare policy is set by the devolved governments in Edinburgh and Cardiff.

• All parents of two-year-olds who work at least 16 hours will be able to access 15 hours per week from April next year.

• It will expand to the same eligible working parents of children aged from nine months to three years-old from September 2024, with a further expansion a year after that.

• Hunt said the package was worth on average £6,500 ($7,844) every year for a family with a two-year-old child using 35 hours of weekly childcare, and would reduce their childcare costs by nearly 60 percent. 

• Other new measures announced include piloting incentive payments of up to $1,443 for childminders who sign up to the profession, and increasing funding paid to nurseries providing the free childcare.

Tax and wages

• Hunt has scrapped the lifetime allowance on tax-free pension contributions, which is currently $1.29m

• The tax-free annual pension allowance has been lifted from $48,000 to $72,000, having been frozen for the previous nine years

• Fuel duty has been frozen. The 5p (6c) cut to fuel duty on petrol and diesel was due to end in April but has been extended for another year

• From August, alcohol tax rises will rise with inflation, while there will be new reliefs for beer, cider and wine

• Tax on tobacco will increase by 2 percent above inflation, and 6 percent above inflation for hand-rolled tobacco

Other key measures

• Commitment to raise defense spending by $13 billion over the next five years

• The UK will spend more than $1bn on a new supercomputer facility to boost its AI industry

• The main rate of corporation tax, paid by businesses on taxable profits over $300,000, will rise from 19 percent to 25 percent

• Businesses with profits between $60,000 and $300,000 will pay between 19 percent and 25 percent

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