Tax-free childcare - government consultation - have your say.

[KatieMumsnet]

Hi there

The government are currently holding a consultation on their tax-free childcare proposal.

The policy, announced by David Cameron in March is a money-back scheme where working parents can get 20% of the cost of their annual childcare costs up to a maximum of £1,200 a child. It is open to all families where both parent’s work or one parent works in single-parent families. The scheme will initially be for parents of children under the age of five, but it's the government's intention to extend that eventually to parents of children under the age of 12.

You can read Mumsnet’s guide to the programme here, the discussion thread at the time of the announcement here and the full consultation doc from the government here.

If you'd like to feedback your views, the government are asking about how the vouchers might work, how eligibility should be determined and for other thoughts on the programme.

To feedback your views via a government questionnaire you can click here

Or to provide a fuller response you can click here to download a response form.

We will also collate comments here and submit them to the treasury. The closing date for the overall consultation is the 14th October, but the closing date for the questionnaire is this Friday – the 27th.

Best MNHQ

[Bonsoir]

Why discriminate against families where there is a SAHP? I don't think it is the business of governments to offer tax breaks to certain sorts of families and not others. Some families with SAHPs have very good reasons for needing childcare - families where there are significant caring responsibilities being shouldered, for example.

[Bonsoir]

To give a real-life example: a middle-aged friend of mine has given up her very well-paid job because her elderly parents are frail and need help, her only sister is shortly to lose her H to cancer and has 3 DC in critical school years and that family needs huge amounts of support - and she has 3 DC of her own for whom she must continue to employ a nanny due to her frequent absences from home (parents and sister both live a long way away). This is France so she gets a tax break for her nanny whether she is working g or not. Frankly she deserves it and I think she would be rightly very cross if she had lost it in the circumstances.

[noisytoys]

Our childcare is £730/month and that is after the 15 hours free funding. The £1200 won't be 20% for a lot of parents who both work full time.

[missinglalaland]

I'd rather stay home and look after my own children. Dear husband works very hard. No tax break for our family then.

[Bonsoir]

And what about families where one parent is not well enough to work or shoulder much in the way of domestic responsibilities? Don't those families also deserve help with childcare?

I find this gross prioritising of the able-bodied who work for money as opposed to those who have quite possibly made very unselfish choices to care for others, or who have health or other issues, very distasteful.

[YoureBeingADick]

I don't think it goes far enough.

I think every adult in the UK should get 1 full time to the age of 5 and part time from 5-12 childcare place tax free. (obviously only if working and have a child to claim the place)

[BettyandDon]

I believe that most SAHMs are doing it because they think it's right for their children.

It is virtually impossible to find well paid part time work and only if this was available would it be of interest. Offering £1200 off a huge childcare bill would not entice me back to work.

Having the same job I did before on a part time basis would. But this was not possible due to 'business reasons', ie, the fact that the majority of the working world does 9-5.

[ShreddedHoops]

Am I understanding this right?

At the moment I work very part-time, not over the tax threshold. I want to do the work though, so toddler DS goes to a childminder for 6hrs /wk.

DH is getting childcare vouchers through his work, which reduces the cost for us from £30 to £18 as he's a higher rate taxpayer (just).

With the new scheme coming in, does that mean he couldn't apply for the vouchers and it would have to be from my pay, which would be pointless and save us nothing as I don't earn enough to pay tax? I'm confused

[WidowWadman]

So what happens to the childcare costs of parents with children over 5 if this replacing the childcare voucher scheme which currently has no such restrictions? This could mean that actually a lot of families are initially worse off until it's rolled out to older children.

[amothersplaceisinthewrong]

With the trend of women having their kids later in life, there is every chance there will the situation of young children and elderly parents to juggle for a not insignificant number. Why not give these families the same help

[Spirael]

This scheme either needs to be available up to 12 year olds straight away or it needs to increase the age range faster than one per year.

DH and I both work FT and neither of us are higher rate tax payers. We have one child and another on the way, who we have deliberately waited to have because we cannot afford to have more than one child in full time childcare at any time.

Because DC1 will be 5 YO the month before this scheme comes in, and will continue to be a month too old forever by the way the age limit is currently set to increase, we will never be able to benefit from this new scheme.

With just one qualifying child then in childcare, it is better for us to stay on the old scheme than to join the new one. Problem is, this means that from 2015 neither DH or I will be able to change jobs without losing out on childcare vouchers, or we'll just lose out anyway as the schemes slowly shut down over the following 7 years.

Not much of an incentive there for us!

[Rooners]

I'd rather they helped people who have children to afford to be able to stay at home to look after them themselves rather than pay someone else to do it.

Not sure of the politics of it but iyswim..

I'd LOVE to go back to work, but I chose to have children and I have to be here for them. If I left them in childcare I'd feel like I'd had them for no reason...work has to take a back seat for me, till they are a bit bigger. At least till they can talk to me reliably about what they did all day.

[Rooners]

Also as a single parent, I really fear the moment when the govt is going to say, either you work FT or we take away your CB etc. Here is some lovely childcare assistance so you can leave them with a stranger and go back to FT work.

It freaks me out - I didn't want to be single. If I was with someone, one of us would be here with them (given ideal circumstances). But I'm all they have got.

[WidowWadman]

Also great that you lose all support as soon as one of you loses their job. Losing half of the childcare vouchers was bad enough when my husband was unemployed, if I had lost my entitlement too, would have made it worse - what with nursery notice periods, and actually needing childcare in place when looking for a job.

As for support for SAHPs - if you don't want to use childcare by your own choice, you surely don't need support in paying for it. This is discussing supporting those who need childcare. Really don't get this politics of envy.

[NK5BM3]

Well. I'm staying on my current childcare provision of £243 thank you very much. My older child is in year 1 but we pay for afterschool club to the tune of £9/day. School dinners £2.25/day. Staff devt day £25/day.

Younger child costs £800/month in nursery. I use the £243 for her bills. Dh is self employed so none of this stuff.

£1200/child doesn't get me near as £243x12!! What nonsense are they talking about?

[nameequality]

I am concerned about whether money placed into voucher companies will be safeguarded.

Will the money be placed on trust so that if the voucher company goes bust it cannot be touched?

Another issue is whether schools who provide before school and after school clubs will be compelled to accept payment via voucher.

DS's school has a breakfast club which does not accept vouchers....

[Rooners]

Widow - sorry, didn't mean to come across like that at all. I'm not envious. Really not.

I was only saying that because I see so many people saying on here 'I would love to stay home and look after my baby but we can't afford to'.

So I suppose I feel sorry for people like that.

[Rooners]

Also I'm coming from the POV of someonewho's concerned about the massive pressure on single parents to go to work when their child is 1yo. It might not be there yet but it's coming.

[IrisWildthyme]

As Spirael has already pointed out, this new scheme is massively unfair to families with a child born before about 2011 - children aged 5-12 between 2015 and 2022 are going to need plenty of childcare after school and in school holidays and are going to get zero help with it. There aren't that many decent jobs which fit around school care hours. This aspect of the new scheme is the worst bit. It's also less money for families which currently have two parents in the old scheme but have only one child, but that bit doesn't seem quite so unfair as it does make sense to have a saving per child rather than per family.

[dollywould]

I'd like to know why the government won't allow childcare costs as an expense against tax - surely that simpler than some arbitrary figure conjoured up by some wonk. I can't work without childcare - how can it not be a legitimate expense? (I'm self-employed, so childcare vouchers don't apply)

I also second every word that Bonsoir has posted. Why can't the proposals also take into account those who care for other family members or those with health issues? How can you talk about the 'big society' if you don't value carers (who incidentally save the state a bloody fortune...)?

[RicStar]

This seems administratively complex. How are they going to link me & dh & dd together & check we are both working. There is going to be a minimum hours for employed people 16 i think but what about self employed? Could i do a few hours consultancy & claim. Who claims the vouchers i work 18hrs but don't pay much tax. Then there's all the admin for voucher companies & childcare providers... I would just have an additional transferable tax free amount *2 for lone parents & maybe scaled higher for under 5s.

[Theincidental]

It's frankly bollocks and a minuscule amount of what is required.

Either nationalise preschool childcare provision or push up wages to reflect the true cost of living.

This ridiculous tokenism is not going to have any real impact on families struggling to pay childcare bills that often represent 50% of their income.

[PPPpickUPaPenguin]

I don't like it at all. You are wrecking the family. If someone wants to work full time let them, not everyone wants to.

We have plenty of working years before children and once the children are at school, it is only a few precious years children are small and so important.

As for this rubbish of wrap around school age child care, fine if someone wants to work, why all this forcing children to be with exhausted parents for an hour a day.

Make more term time part time jobs available around school hours instead, invest the money that way. Children need friends back for tea, after school clubs or to just hang out as a family after school.

I would rather the money go to support SAHM's to bring their own pre school children up if that is what they want. Allow families to afford to keep Mum at home who wants to, rather than generations of children brought up by strangers. Nobody will love and care for a child like their own parent.

[racmun]

This proposal is just another sound bite to win votes from 'hard working families'. I'm a SAHM but my dh works incredibly long hours and works really hard to enable this.

David Cameron and the Tories need to be careful that their not alienating their core voters with policies like this. Traditionally one high earner in the family who have already lost their child benefit and are being excluded again from policies which 'help' families.

Perhap's introducing a system whereby the SAHP can assign their personal allowance to their partner would help ease some of the perceived infairness!

I'm a SAHM, financially we're lucky enough that I don't need to work but sometimes I think I will get a job (when ds goes to school full time) which is just below the personal allowance tax threshold (dh loses his as he earns over a certain amount) just so I can take advantage of these policies..... Where are all the jobs though? Is it fair that I take a job I don't really need just because the policies which have been implemented push me into doing so.

[weddingballs]

It doesn't go far enough.

And don't get me started on SAHM whinging they're being penalised for/missing out on childcare help.