Should tax-free childcare and ‘free hours’ be universal?

[Nursery772]

Having attempted to apply for the new 15 free hours for my nearly two year old, I discovered you are not eligible if you earn over £100k.

My four year old also receives only 15 of the 30 free hours for the same reason.

I am not sure if the additional 15 hours from 9 months / 2 years will be income contingent.

Between this and tax-free childcare, I will lose about £12,000 of post tax income in 2024/5 tax year.

This seems very onerous!

Should tax-free childcare and ‘free hours’ not be universal? It is an expense to allow me to work, and I’m paying quite a bit of tax.

Also being applied as a cliff edge is brutal, seems to create an artificial ‘cap’ on the amount parents of preschoolers can earn.

No you brought an expensive house downsize. Many can't afford a mortgage and pay exorbitant rent, do 40 hour weeks and can't eat or heat

£100k is a lot of money you can have a comfortable life on that with holidays ....maybe not a 4 bed house or several holidays but a reasonable 3 bed I'm most areas and a holiday I would rather put more into the NHS then help people have more holidays, cars etc.

No but £100k is a big salary if you don't want to pay all of your childcare bill because of some strange sense of fairness give it up do an equally well valued poorer paid job that took as much time to qualify for and claim the benefit then you will feel better.

It shows how broken our housing market has gotten if a couple on 100k can't buy a 4 bed house in much of the country.

We've got 3 kids, nursery x2 and wraparound x1 would cost us about £35k per year. Given we also pay a truly vast amount of tax, I genuinely don't feel bad about getting some of it back in childcare temporarily. Fortunately DH is "only" on £95k for now, so we do get some help still.

The allowance my employer pays me for essential work travel is "an expense that allows me to work" too. Universal credit still take money off me for getting it though even though it is not really income as I am claiming back money already spent that is not discretionary spending (my employer might have something to say if I don't turn up for work). My better off colleagues get to benefit fully from their allowance. I'm also seeing lone parent students losing UC money due to being awarded a bursary for equipment for their course. The money is for equipment, it's not "income" either. It's shit being able to do nothing but pass them tissues and send them for a foodbank referral. I think things like this where people trying to better their situation are harshly penalised need addressing before universal childcare for the better off. In an ideal word you may be right but for now it's less of a priority, at least from where I'm standing. I'm not planning to remain on UC for life so I have minimum skin in the game here, I just think the government treats the less well off appallingly.

Your last paragraphs are key. People on this thread saying “if you earn over £100k then you earn enough to pay childcare” are perhaps forgetting the common situation where it’s the partner earning over £100k and the primary caregiver earning nothing because it’s not worthwhile to do so. They take career breaks and sometimes struggle to get back into work. What happens when a couple in this situation split up compared to a couple earning £60+k each who have been able to have massively reduced childcare in comparison? The opportunities are not fair for primary caregivers in this situation and it is bad for the economy. It’s very myopic to think “£100k! You can’t complain”.

@CouldIBeAnymoreOuting

This is so true, especially for unmarried women this could be a huge problem eg not contributing to their own pension.

Again bad for society - we have a pensions crisis on the horizon!

I think we need to stop telling women who are usually the lower earners that it isn't 'worth it' to continue their careers because that is exactly why it is worth it long term to stay in work.

@SouthLondonMum22

I'm not telling them that, I know of people who have come to that conclusion themselves and would prefer to work as the numbers don't add up.

It seems to be a common conclusion, it is very short sighted. Especially if the husband is earning £100k+ and childcare isn't considered an expense from the mothers lower salary.

But you decided to have 3 kids and pay the £35k plenty have 3 kids on a half or less than this so even with getting paid childcare are on less than you £60k is an enormous amount of money after childcare.

I wasn't I complaining. I was just explaining to you how much it costs and how I don't care whether or not you think we deserve subsidised childcare. We will claim it as long as we can, we will stick as much in pensions as we need to and will not feel an ounce of guilt.

Don’t complain about the state of public services then.

We need people to have children to support our public services in a few years!
We have an aging population and a declining birthrate, it's going to be a big problem when there is noone to look after our older folks.

If the figures don't add up, then they don't add up. Is it realistic to tell people that they need to go into debt and potentially loose their home because of the cost of working because they might do a little better in the future?

Why would they be going into debt and potentially losing their home if their partner is earning £100k+?

Yeah, because obviously higher earners getting a little bit of childcare for a couple of years are the reason public services are stretched. That maths adds up perfectly.

If it’s only a little bit why bother to find ways round it?

Why does it matter if we do?
And because that little bit of childcare is really really expensive.

I think we’ve gone the complete circle now don’t you?

Because high incomes don’t fall from the sky? People make conscious choices to prioritise education and then careers/building businesses (over having children early on) to get to those high incomes.

Anyone smart will leave the country so they won't be around anyway

@User5512 and they are fortunate to grow up in an environment/financial situation that enables them to do that as well as of course having the capability

It's also pretty scandalous that a single parent earning £100k loses all nursery/ childcare funding whereas a couple earning £50k each get nursery/ childcare funding and child benefit and are taxed FAR less so have a much higher household income despite having two people to share childcare so needing less paid childcare than the single parent.