New childcare tax break to be announced by the Government today - what do you think?

Yes morethan, I think they'll have to do something along those lines to pacify the Tory vote before 2015 - it's going to be messy though.

Or perhaps I should say, even messier.

I am still finding it difficult to understand why so many people are surprised by the present government announcements. I have said this before but here I go again. We really do have a Conservative Government who historically support a sahp and the traditional nuclear family. Of course the 2 parent working situation isn't really going to gain help from the gov in real terms. The married persons allowance will be back though.
FWIW even though nothing has been announced yet we have all heard their propositions over the past year. I think the only people who won't be out of pocket will be the married couple, one working, one sahp, with no childcare, on low income.

The Government is very very against board quotas (a pity) . They seem to like women doing badly at a work and very very few women in the cabinet.

On benefits there is a good letter in today's FT about child benefit issues:

Think again, FT, on benefit cap

From Ms Fran Bennett.

Sir, You argue in your editorial ?Child benefit cap is tough but fair? (January 7) that ?the welfare state should be targeted at those who need it most?. But this is a very narrow view.

Benefits in particular have a range of aims, not limited solely to the relief of poverty ? the only function a ?targeted? (read: means-tested) benefit can perform. A social security system can provide mutual insurance against shared risks, and facilitate adjustment to economic change. More specifically, child benefit can help redistribute income over the life cycle to the time when families need more of it ? when they have children.

But most importantly, child benefit replaced not just family allowances but also child tax allowances. For more than a century, this country has recognised that all those with children, at whatever income level, have a lower ?taxable capacity? than those without. Virtually all developed countries have similar provisions, through either a tax allowance or a benefit. Now we are reneging on that.

Instead, the government is imposing a tax increase ?targeted? on families with children. There are good arguments for the better off to pay more towards reducing the deficit. But there are none for picking on only those who happen to be bringing up children at the current time. The government should think again ? and so should you.

Fran Bennett, Oxford, UK "

Very good points.

I don't think it is right that women have the choice to return to work. It is up to the parents to decide how they want to raise their children. If the parents decide one is to stay home, and therefore not work, the family should get some sort of assistance. I think the fairest way to do this is to make raising children a minimum wage job (35hrs a week at min wage) which is deductible against the working parents income. The dual income families should be able to deduct the full cost of childcare against their income. Not that many households with no SAHP have more than 2 children.

This would make the UK truly progressive which is why politicians don't want to go there. Instead they would rather bring in rules on boards having a certain number/percentage of women.

I admit I am confused about this universal tax thing. What is is? We don't qualify for any tax credits in any shape or form therefore I have no idea what any of these 'elements' mean. The only thing we do is the childcare vouchers which is not means tested. I suspect we are not the only people here who this applies to.

DeGlitterBug spot on. One parent at home is great for children Xenia, whether it's their Mother or Father. I couldn't care less if another Mum wants to work, but I get fecked off with my decision, my choice to stay at home being derided. Feminism is about choice and I am not returning to work to a shitty, clerical job, which are always low-paid, just to keep anti-SAHP people happy, working to pay to get to work and for childcare. I worked full-time for 15 years and paid into the system. I agree that being a SAHP isn't easy so I'm glad that was acknowledged though.

One thing I do like about the proposed changes is that everyone can claim back childcare costs. I have worked as a freelancer/temporary worker after my eldest was born. I have never been able to claim childcare vouchers - either I have been self employed, or my employer did not offer them. So at least I would be able to benefit form this proposal.

However, I'm not sure I can see any other positives in it. It is hard work dealing with the tax credit system when you do not have a salary, claiming back tax can only make this more complex.

I'm not sure how you know whether it's fun or not, xenia, since you're always telling us that it's something you've never done!

DeGlitterbug

Irrespective of any decisions made to support both parents working, the devaluing of parents caring for their own children has been increasing for more than a decade now.
I think it is such a shame that some people look down at a sahp or as in Xenias case choose to believe in some way its not good for children, or fun. Speak for yourself but don't generalise.

It should say working parents will be given.... Children have two parents. The way this is presented is sexist to the core and Cameron (wife works at Smythson and Clegg (wife is senior lawyer who will earn more than he does as a lawyer at a London law firm) ought to know better.

If it were great for children or great fun to stay home men would be itching to do it.

"Working mothers will be given thousands of pounds-worth of support for child care to help them to return to work, under plans being considered by David Cameron and Nick Clegg."

The above quote is why it is also relevant to mothers who do not currently work (or only work a little), and especially those whose household income is under pressure from other sources, say maybe the loss of cb. The measure has been badged as to 'help' mothers return to work. See my original post about the devaluing of parents caring for their own children.

"You can leave a government run nursery or school for that matter and if enough people vote with their feet then they do indeed close. "

That is only true if parents have the freedon to choose whether to use their tax break/vouchers/etc. wherever they so choose. If state run nurseries are set up and only those nurseries are accessible, then parents can't really leave them.

...some relevance to this particular debate.

Not sure where the extra numbers came from. Apologies.

I have to type and run but I lifted this directly from the DWP website from the FAQ page regarding the new Universal Credit which is coming in to force. Just some extra food for thought.

"What is happening about childcare?
Support for children within Universal Credit will be provided in the form of a child element. This will be included in a claimant?s Universal Credit award where they are responsible for a child or qualifying young person that normally lives with them. The child element is comprised of two rates; one rate for the first/only child and then a reduced rate for second / subsequent children.
Universal Credit will provide more support for childcare costs. Under current tax credit rules, support towards childcare costs is only available to parents who work more than 16 hours per week. Under Universal Credit, this requirement will be removed and support will be available to parents regardless of the number of hours they work. This will provide an important financial incentive to those taking their first steps into paid employment. It will mean that around 80,000 extra families will be eligible to receive support through childcare.
Universal Credit is expected to be particularly beneficial to lone parents, including those who wish to work a small number of hours."

This is for out of work as well as in work parents so has some relevance.


xenia
We are now paying a marginal tax rate of 72%. Every extra pound dh earns, we give 72p back to the Government. 50% was seen as being too high a rate for super rich, but 72% is seen as being ok for middling families.

You can leave a government run nursery or school for that matter and if enough people vote with their feet then they do indeed close.

There is the wrong perception among some on here (and see telegraph article on sahms today) that this "childcare tax break" is somehow being given to placate for lost CB. And this is why sahps feel hard done by. This is fallacious for 2 reasons:

1. The new policy would replace childcare vouchers and childcare element of working tax credit. The tax saving would be similar to what is currently available through vouchers. So working parents are not being given anything extra. I don't know, but I suspect the flat £2k tax free allowance is less than lower income workers currently get through childcare elt of WTC. So this policy is actually a CUT to lower income working parents! And does not help middle income working parents any more at all.

1. The working partner of a sahp would still be able to offset the 2k tax free against childcare. It is unclear whether it would be 2k per worker, per child, or per household. But 2 working parents should get more tax free allowance for childcare, this is only fair.

I agree that CB should be to reward and help those who raise children no matter their working status/income but this is a separate issue from helping parents go to work by allowing income tax breaks for childcare.

We need both. A lot of us know the state does things badly and the private sector very well but let people keep their choice. An unregulated daily nanny for your 3 under fives who works in your home (which is what we had) is absolutely find for most of us and you can get some really good people.

"On the whole government run facilities are usually far superior in terms of compliance with health and safety"

Really? Can you back that claim up with some evidence/examples?

I think it would be better to give parents the choice of who looks after their children. If a nursery is not performing, leave. When they lose their business they will either improve or close.

I've seen done shocking private nurserys, schools and hospitals. On the whole government run facilities are usually far superior in terms of compliance with health and safety, less focused on profit.
The government run nurseries wouldn't be forced on anybody but if you need or wanted to use them, they could be available or heck how about a voucher scheme. Oh wait a minute

Considering the (poor) job they do running schools and health care, I perfer the government (any government, not just the current one) keep well away from my childcare.

What we need is financial means for hard working (yes I mean those who undertake paid employment in addition to their parental responsibilities) people to make their own childcare decisions as appropriate to their own family needs.

If we allow people to deduct their childcare costs from their income before tax is calculated that would be simplest and fairest. And, obviously, in the case of one parent working and the other staying home, the amount could be deducted from the income of the parent who is working.

birdofthenorth / numptymum - me and DH both work in charity/community sector but while bigger, UK wide charities do tend to offer the vouchers, the smaller, local organisations don't. I find the cost of childcare just for one DS hard going, and with DC2 on the way its only going to get trickier :(

numptymum just to say I worked for a charity for five years until last year who offered childcare vouchers. I'm sure you're right that there may be a fee or administrative burden that puts off charitable or small employers but I just wanted to highlight that not all of the third sector opt out.

Free state childcare would create masses of jobs, regulate all childcare centres to a minimum standard and hopefully ensure its adhered to and would save a fortune in social services and family support as low level neglect and abuse would be either avoided or at least picked up quickly and dealt with as was proven by sure starts success rates.