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.

@ManchesterLu
It's a bit hypocritical to talk about 'life style choices' and then refer to people who have to make tough financial decisions. What if I were to say lower income families made the choice to be minimum wage?

I think it should be universal, or at least looking at overall household income. Lots of women with a high earning partner aren't eligible for enough childcare to afford to work. They'll have lost child benefit too. But what if she wants to work? What if he's financially abusive? She has absolutely no income and is entirely dependent on him. Why is that acceptable? What if he leaves her after her career 'break' and she's completely fucked when it comes to employment having been out of the workforce for years?

That’s simply not true. Anyone earning under about 45k isn’t even funding themselves. Only about 20% of people are net contributors. Everyone else is subsidised to some degree.

So those children get more and more disadvantaged in order that richer children get the opportunity? Play groups are not a replacement for nursery and especially for preschool preparation for school.

Big difference between contributing to something you use, and not contributing to something you use.

Ok for how long do you think people should look after their own children after birth before other people fund childcare for them?

I'm not sure if it's been said, but there is no earnings limit for the 30 hours free child care in Scotland.

Scotland is wonderful.....

@Naptrappedmummy toddlers groups aren't someone else looking after your child

@Naptrappedmummy

Ok for how long do you think people should look after their own children after birth before other people fund childcare for them?

From 9 months upwards when SMP stops... otherwise woman (more often than not) give up work and pay less tax. It's economics.

A government investing in childcare gets significantly more back in tax take as women can continue working and people don't circumvent their taxable income to pay less tax.

Also it's not "other people" funding childcare, it's literally the higher earners paying more tax and also paying more for non funded hours (subsidising those getting funded hours) given that the funding is not enough to cover "free" hours.

“Surprised it took five pages to mention the poor popping out kids.”

Almost 1 in 4 children are eligible for Free School Meals. Something has gone horribly wrong.

Meanwhile, the politicians think short termist and cater to the elderly and middle aged voting base, because that is where the numbers are. We cannot carry on like this because it will destroy the country and causes security issues long term.

Look at what China and other countries are doing to incentivise people (and certain people at that) to have children and at a younger age. Some cantons in Switzerland let you deduct taxes depending on the amount of children you have. Let’s say you earn 120k and have 3 children - you get to deduct £7k per child and then only pay tax on the remainder. That is reclaimed through self assessment for higher earners.

To become more productive again, all work has to be worth it at all levels and people having children across the income spectrum have to be supported and especially at the higher ends, because that is where the kids end up with a better experience and the parents tend to input things schools cannot make up for in school hours alone. Ask any teacher or head teacher. It is stereotypical but you need 2-3 at the middle and higher income levels. The Nordic countries have understood this ages ago.

Most people pay nursery fees even though they are on UC. It is only 85%. Very few have it funded for them. To answer your question when maternity pay ends there should be subsidised childcare basically from one.

I have taken both my kids to playgroups. We are very lucky there but it isn't the same as a full day at nursery. It sounds like you don't even want any funded and children start school totally underprepared for it. I imagine some children will be even less likely to be able to do things if they don't have preschool to teach them as some parents won't.

Most people on UC don’t work so how are they paying?

I mean those not working.

Yeah, Scotland is on another level, but I am wary of mentioning Scotland on threads/in discussions like this as there is always at least one person to shout it is all paid by England!!!!

At the moment we have lazy poor and suffering middle class narrative I did not want drag Scotland into that. ;)

While Germany and Poland have similar systems but are, in administrative terms, like two opposites. It is a proof that such system is possible within different setups.

I believe at least 40% work. Probably a fair few nursery workers will be getting their wages topped. Once you work you quite quickly are above the threshold for not being entitled and have to pay for childcare.Plus you only get the 80% if both parents work in a couple or a single parent who works.

*85%

It isn’t free childcare

the people doing the childcare are being grossly underpaid

Sure; a choice largely compelled by the fact that people increasingly can’t afford to have kids until they are in their thirties and yet the timeline of the biological clock doesn’t change. Waiting three or four years for many parents these days would potentially mean no second child.

NHs Hospital consultants earn this.It's about £5k after tax and pension. There isn't a tax adviser in the world that can help you with PAYE.

Sorry £5K a month.

Tax free childcare sure. Funded hours no.

The vast majority of single parents who have children and are using their entitlement of hours, actually are in work. If they're not in work they aren't eligible for the new entitlements.

No the purpose of these schemes is to support low earners who are statistically more likely to become unemployed. To enable them to work and to make working more lucrative . There is also an added incentive of ensuring that the children who again are statistically more likely to start school developmentally behind gain access to a nursery environment earlier.
You earn 5x what a person on minimum wage does. And yes I appreciate you pay more tax and get no benefits but if you can't afford to live within you means then you need to do what poor people do -budget.
The issue is people on 100k feel cheated that they are not living a luxury life as they were 20 years ago well guess what the poor feel cheated that they are starving and can't afford food and heat.
If you want things to change don't vote Tory at the next election.

Yes, they should be universal. We need to keep higher earners feeling they have a stake, and our terrible public services won't suffice. Plus we also need to prioritise a tax system that minimises cliff edges, bottlenecks and perverse incentives not to work more, especially with our current worker shortage. That applies at all points on the income spectrum.

You don't see how someone could turn round and also say 'it's not my fault you chose to have children close together and now face a high childcare bill' though? I'm not saying I completely agree with that sentiment, but access to early years education matters for all children, not just those whose parents are working and are high earners.