Childcare subsidies should be repaid in the same way as student loans
howabout · 27/06/2015 15:48
(A couple of other threads discussing the economics of working while raising a family. Also in light of the extension of free childcare for working second earners.)
It seems fairly universally accepted that stepping out of the workplace in favour of childcare for any significant length of time has a long term financial consequence. However tax reliefs and subsidised childcare tilt the economic balance even further in favour of those who need childcare to maintain their job. Student fees and loans were introduced as the majority felt graduates disproportionately benefited from their education. Therefore as childcare costs are only "unaffordable" over the short term and not over a working lifetime I propose they should be repaid via the tax system in the same way as student loans.
I am interested in how others feel about this.
Zoneout · 27/06/2015 16:07
What I don't like about student loans is that it is means tested on the parents when it is given, I think that there should be three set amount for student loan regardless of family income (1 for living at home, 2 for living away from home, 3 for living away from home in London)
If there was one set rate given to all families for childcare not means tested and taken from income when income is above a certain amount, even if that is the case when the childcare is being used, I think that would really help the lack of means to pay at the initial time. The only problem I can see is that it would end up being a women only tax not sure how that could be solved.
But YANBU in principle.
MoreBeta · 27/06/2015 16:15
It would disincentive women from ever going back to work if their salary was in effect taxed in the normal way and then then taxed again to pay back childcare costs. It would not be worth going back to work for many women in low paying jobs.
Lets face it though, Govt would find it awfully convenient to get women out of the work force to cut unemployment.
Govt and society tacitly agrees women are second wage earners and in times of economic downturn they should lose their jobs or take wage cuts so men can stay in work. We don't want men out of work.
Really that is honestly what many people think. Equality is Ok when times are good but in economic downturns equality is a luxury we cant afford.
I am a man and I think we should scrap family allowance and instead make childcare costs up to a certain limit tax deductible if you work - whether you are a man or a woman.
BlueStripedHat · 27/06/2015 16:31
How easy would it be to work out the relative repayments each parent was supposed to make? Presumably each parent would be liable to repay 50% of the cost each.
If the mum was earning £30,000 and the dad £25,000 and both were repaying the money at 1% of their income I think it starts to look complicated. Then everything has to be recalculated when dad gets a promotion and his earnings increase. And again when mum decides to drop a day a week and takes a pay cut.
What happens if dad never earns enough to reach the repayment threshold? Does mum just pay her 50% and dad's half is written off?
It surely can't be a joint repayment because how would it work if the parents separated?
DisconcertedAndRetired · 27/06/2015 16:45
Why stop at student loans and child-care subsidies?
I have a fantasy in which people all have a social security account, and everything that they get from the government that can have a cash value attached is charged to that account. The account is paid off by an extra tax on wages, probably a replacement for National insurance. (Interest charged at rate-of-inflation on the outstanding balance.)
Obviously all benefits received would be charged to this account.
Have a child at school? That will be £3000-£5000 per year per child.
Something like £3000 per year per family member for use "membership" of the NHS. (Most actual use will on average be concentrated into the last years of a persons life.) Though maybe this fee could be reduced by the amount raised by charging say £50 for each GP visit, £250 for an A&E visit, and an extra £250 for going there in an ambulance.
howabout · 27/06/2015 16:59
No I didn't Namechange. Just a bit fed up of being told what a drain I am on society having become a SAHM after paying more tax than most pay in a working life. Why is a long subsidised career more worthwhile than a short high contributing one? The sense of entitlement regarding chi!dcare bothers me.
I agree student loans disproportionately affect women with children but so far I am not hearing this being articulated widely.
For the record I believe all education should be free and that early years education for all should not be sacrificed in favour of childcare for some.
Therefore if my starting position is not widely supported I wanted to test the consistency of the opposing view.
quietbatperson · 27/06/2015 17:01
This reply has been deleted
Message withdrawn at poster's request.
ThinkAboutItTomorrow · 27/06/2015 17:02
Disconcerted I don't get how that works? The vast majority get more out of the system than they pay in, especially if you are only counting regressive taxes. you'd just have loads of people dying with huge 'debts' on these accounts that needs writing off. Assuming the wealthy who currently subsidise the system are somehow entitled to their cash back the government wouldn't balance the books.
Or do you stop paying out to those without the cash in their 'account'? Leaving the old and sick to die on the streets?
annandale · 27/06/2015 17:04
Considering that the student loan system is going to cost the country a fortune compared to giving out grants, I think it's a shit idea and (to borrow Mr Osborne's constant mantra) we can't afford it.
And I hate the constant othering of all government funding. Bringing up children is one of the things that we do as a society, not as atomised consumer units. I'm sorry that you feel so unsupported as a SAHM.
TerryTheGreenHorse · 27/06/2015 17:05
I'm not entitled to any help with them, fair enough.
It would be nice if I could say have it slightly subsidised and pay it back over a period, just to take the edge off.
However for people that are entitled to help with them YABU. It's normally as they are on a lower wage, I don't really see your point to be honest. With a degree you are realistically expected to get a higher paid job (perhaps) at the end of your course, why would you think that of someone who is entitled to childcare help?
larkspurr · 27/06/2015 17:23
'Sense of entitlement'? You imply that you paid more tax in your brief career than many do over their working lives - in that case, you were privileged to be an extremely high earner. High earners may well (depending on individual circumstances of course) have the choice of whether to stay at home with their children or whether to work - a lot of women don't have this choice. Who has said to you that a 'long subsidised career' is more worthwhile than your short, well-paid one was? Anyone saying this is judgemental and unfair - you evidently worked hard and are now choosing to stay at home to give your children love and attention - no-one should criticise your choices here. But to reverse your question, are the careers of women who work in low-paid but important jobs - such as care work - of less value to society, and therefore undeserving of subsidy? What kinds of 'subsidy' do you disagree with? Tax credits, the salary sacrifice voucher schemes (which affect mortgage applications etc, subsequent maternity pay, National Insurance contributions etc, so do mean that users lose out a little in the long term), or the Government's new system?
PtolemysNeedle · 27/06/2015 17:35
I think you have a point. The time to be educating yourself is not when you have young children, so I don't think students should get subsidised childcare, but I do think that tuition should be free to everyone as long as it's a worthwhile course. And I think childcare should be free to working parents.
DrCoconut · 27/06/2015 17:52
I claimed a childcare grant for the last year of my degree (when it was first introduced). Prior to that I had struggled a lot for money, being worse off than I would have been on income support. I had left an abusive relationship and was determined to make a go of things. That bit of support has allowed me to build my life virtually from scratch by getting a decent job and all the things that allows. If I had had to quit the course due to money, which was a distinct possibility prior to childcare grants coming in, who knows where I would be now. Probably still on benefits or stuck in a dead end low paid job. So, it's a definite "no" from me. If anything people who are trying to help their situation deserve more support not less.
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