BEIJING -- China's phased free preschool education policy will cover all children in their final year of kindergartens nationwide, benefiting around 12 million people this autumn semester, a Ministry of Finance official said at a press briefing on Thursday.

The policy is expected to save household spending by about 20 billion yuan (about $2.8 billion) in this autumn semester alone, Vice-Minister of Finance Guo Tingting said.

The exempted fees will be covered jointly by central and local government, with the central government bearing the lion's share, Guo said, adding that central and western regions will receive greater support.

The official also noted that China will improve the policy in due course to ensure more children can benefit.

China announced the phased exemption of care and education fees for children in their final year of kindergartens on Tuesday, as part of broader efforts to reduce the financial burden of education and enhance public education services.