Ministers are set to announce the scheme, which will ‘ease financial worries,’ ahead of Wednesday’s budget.
It was first announced last year, but will be brought in sooner than expected, is worth £800 more per child than was initially proposed and will include all children under 12.
According to the Family and Childcare Trust, the average nursery cost for a child under two rose by 4.2 per cent last year to £106.38 per week for a part-time place. A full-time place can cost up to £11,000 for a year.
The scheme will be available to high-earning households with a joint income of up to £300,000, but it has come under fire for excluding couples where one parent does not work.