The government's Tax-Free Childcare scheme: your views wanted(27 Posts)
The government has launched a further consultation on its tax-free childcare scheme.
While the main points of the scheme are agreed, there is an ongoing discussion about how the vouchers should work and be administered. Should they be looked after by National Savings & Investment, HMRC or by private voucher provider companies (who currently administer the workplace childcare voucher scheme).
In their own words:
'The consultation seeks views on options for the government to deliver Tax-Free Childcare itself, through National Savings and Investments (NS&I), or within HM Revenue and Customs (HMRC). This will mean all interested parties will have had an opportunity to comment on all of the options for account provision across public and private sectors. The government will consider responses to this consultation alongside the response to the previous consultation before it makes its final decision on the provision of childcare accounts.'
If you'd like to respond to the consultation, you can do so via this link before June 27, or do post on the thread below.
It is better than first planned but it still excludes some children in some families. Why is it just for under 12 years old? Why is there a roll out period (ok this has been reduced to a year but it's still a period of time when those with older children won't be eligible)?
Someone is a child until the age of 16 (or 19 if disabled), so why the cut off at age 12?
Everything by one organisation I feel is better than having multiple different companies involved. Only one organisation to register with or better still, one organisation to be given permission to access existing government databases, so no registration by providers needed.
I wonder if the implication is that children older than twelve don't need childcare and can be left to their own devices. In my opinion, that is not true for a lot of young teens.
There's no mention of exclusions but I thought all adults in the household had to be working to claim it.
The age 12 is reasonable, I imagine the percentage of parents who use childcare at this age is low compared to those with under 12's.
I think employers will benefit and more will remove their own schemes especially smaller companies who simply can't afford to pay for the vouchers for people whilst on maternity/multiple leaves.
However, £2000 is not a huge amount and if we are making childcare tax deductible then it should be based on the persons tax and be variable just like any other expense.
It forces registration on nannies who are currently free of it so it an example of Big Government and increasing regulation which proves the Government lies when it says it wants less not more regulation. However the £6k a year a family with 3 under 12 might get will be helpful to a lot of families although not a huge amount off the cost of three nursery places at £10k per child in London or £20k to £30k nanny cost.
I suspect my daughter and her husband when/if they have children won't qualify. We always seem to lose out in our family. I never even got maternity rights.
I don't think it goes anywhere near far enough.
When I had two preschoolers and worked in a 9-5 job, my childcare costs were £1500 per month. That was for a combination of nursery and an ordinary childminder, not a top-notch nanny.
I don't think this, or any government (this isn't a party political issue), are truly aware of how the lack of affordable and available childcare really impacts women. Our culture is almost institutionally sexist in this regard. The truth is that without significant family support the majority of working mothers would cease to be working.
Quite what's going to happen as people are forced to work longer and so grandparents aren't around anymore is anyone's guess.
Hang on child care costs only have an impact on women who are in sexist relationships. In normal relationships men and women both need to find childcare and pay for it. It is as much a man's issue ad a women's and any woman married to man who does not agree with this needs to kick him up the bottom and hand him the yellow pages to find the nanneis/childminders saying she'll be back from work at 7pm.
JaneParker it's not as simple as being in a 'sexist relationship'. In dh's particular field, shifts are random & hours long, & he doesn't get wk ends off like everyone else does - what would you have him do? Lose hours & pay so he can find childcare or look after the dc himself?
It's not about sexist relationships, it's about money. Apart from career professionals who can afford to hire nannies (which accounts for a very small proportion of the parent population overall), most couples juggle the childcare/working problem based on their family's finances.
I will have spent more than £175,00 in today's terms on childcare once my DC are fully grown. That's fairly normal for two children being cared for soley by paid-for professional childcare. It would be higher if you had to work shifts so couldn't discount for time spent in school.
For the majority of families that's simply not affordable.
And it's a fallacy to think that mum/dad each going PT would result in the same income as one single FT wage. It doesn't. Not in the short term and certainly not in the long term. Promotional opportunities and social stigma have an effect on earning potential and there is the consideration for pensions, etc.
So what happens is that the parents quickly work out that the least stress/maximum income option is that one parent becomes the main earner and the other becomes the secondary earner whose job brings in some extra cash but isn't so demanding it requires expensive and stressful childcare solutions.
That isn't the definition of a sexist relationship, it's a pragmatic solution to a very real problem.
To my mind the solution lies in a greater equality between maternity and paternity leave so that it isn't always the default position that mum becomes primary carer simply because she's the one who can have paid time off. But it needs to be combined with a much more powerful agenda regarding state-subsidised childcare. It's not surprising that the UK is slipping further down the equality ranks when we have the highest childcare costs in Europe.
You have deliberately missed the main question there though. Why is that second pin money earner always muggins mum? Is that because men are brighter than women or more sensible in their career choices? Or is it that women are gold diggers who marry richer men so they can live off their earnings? If it were sexually neutral just as many husbands would be giving up work because they could not afford the nursery places.
I think Jane, that it is because that is the choice the couple come to for their own reasons. Most woman are not in sexist or controlling relationships. I would want to be the one working less and spending more time with my kids, that's my choice as a woman, I would love to be a sahm for the first 5 years!
For many the man earns more and let's be honest, gets less understanding from employers about child related things, or the mother simply wants to be the one caring for their child.
Why does the man earn more? Would a female doctor marry her male house cleaner with the wonderful body? Would a woman on £40k who manages her local business marry the new office boy?
Where the woman earns £50k and the man £18k the women don't give up work. 60% of graduates are female and women under 30 earn more than men yet women still choose from the narrow pool of higher earner men presumably because they want to be kept. Men don't often get the same choice.
Oh and I earned 10x my children's father so not surprisingly we both worked full time.
I thought this was not going to apply to those who employ nannies, registered or otherwise!
One of my beefs is the high cost of registration especially as Ofsted makes us take out public liability even though we are not self employed. then there's the registration itself and the paediatric !st aid to be renewed every 3 years which to add insult to injury has VAT added on. As the government is so keen to have us registered they should pay for it!
Jane this doesn't need to turn into a thread about men earning more... but I think part of it is that women often take a career pause by taking mat leave. Which most women want to do . or maternal instinct makes them want to be around for their kids more so they choose to work part time or don't go for better jobs with less flexibility. There is more being put in place to allow either mum or dad to be the one at home more but it's still mostly mothers who take parental leave.
Although some of us don't want all that time at home for a range of reasons including wanting to ensure our other half does just as much as we do and there are new rules coming in allowing men to take some of the leave. My daughter went to what she said was a very very sexist talk about those changes last week where everyone seemed to assume women serve and take ages off and men swan back to work quickly and never clean up or do childcare at home. Some women are certainly brought up in homes to be conditioned to think they have to be chief cook and bottle washer . If we can remove that sexism women can have much happier and better lives.
sunshine, my understanding is that the £2k per year per child will apply to nannies as long as the parent registers them as a nanny with Ofsted but I don't currently have a nanny so I might well be wrong. There is a £150k parental income limit above which you cannot claim it. Presumably that is if either of the parents exceeds that but if both are on £149k they can still claim it.
One company please, don't really care who but if two parents are involved it's currently a nightmare as there are probably 2 providers
Sunshine, it will apply for all providers in the same way Childcare vouchers does. One place to administer it will with luck be better than having numerous voucher companies.
A plus of the new scheme is that it will apply to parents who are self employed, so opens it to more parents.
Child care is only a woman's issue if the you accept it as such. I don't.
What is sexist is the fact women get gobs more maternity leave than men, and therefore men don't take it. And that keeps the glass ceiling at work well in place.
But, back to childcare, I don't how the vouchers get to me. But I will say this... the amount on offer is so small that its affect on my budget is insignificant
Why can I not be exempt from taxes on all of the money I pay to childcare, which is an expense I incur for the sole purpose of going to work.
Nanny employers can spend their vouchers on plenty of other things (holiday clubs, nursery, tutoring, etc.) and so don't really have much incentive to put up with the hassles of OFSTED registration.
Yes, it's de minimis even though it's too late for me as mine are teenagers now (I am self employed so not been eligible for much so far - I always miss the boat including on most maternity rights)
I agree that this benefit is a relatively small contribution to childcare costs for many people, but it is at least universal, which the old scheme was not. I also think it also needs to be borne in mind that one person's tax bill reduction is generally another's tax increase so it needs to be seen as fair by all the taxpayers who will not benefit, including those who got little or no financial help when their own children were younger. I think this is a step in the right direction, which will hopefully be built upon if it proves a success in overall economic terms.
I fear it will not be universal enough for my newly married daughter though (fit they choose to have children) because of their income and before anyone objects yes they earn a lot but they do have a mortgage of over £1m on a 2 bed flat near work (Central London) so are very pushed even without childcare costs yet.
Fortunately the new rules will allow couples to allocate much more leave to the father if they so wish. Too late for me and DH though as it's coming in next April and our second and probably last is due February!
Agree this is an improvement... but not nearly enough of one for me to really care about the insignificant details, like who issues the voucher.
Regarding "one person's tax bill reduction is generally another's tax increase", there is another option. Downsize the inefficient government and allow hard working people to keep some of their own money to pay for their children. This is idea that the government owns my money and I should be grateful for what they allow me to keep is just plain socialist -- and that's a bad thing.
Maybe suggest to them that next time if they want views from parents of children young enough to need childcare they could do it in the form of a survey rather than a document to read, digest and comment on? As part time working parent of toddlers, don't have a great deal of time, imagine I'm not the only person who'll struggle although I will read it.
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