AIBU to hope the £100k cliff edge for funded nursery hours is removed?

[horchatatresleches]

News is that the education secretary is looking at nursery funding but it’s unclear if it’s to reduce or increase the support available at either the upper or lower thresholds. AIBU to hope that the harsh cliff edge which stops all nursery funding at £100k is removed or least replaced with something tapered so that people aren’t losing money for being marginally above the threshold?

Exactly. The UK tax system is one of the primary causes of low growth and productivity (and therefore declining living standards for everyone).

A Government that wanted growth would:

1. Make the personal allowance universal again
2. Make child benefit universal again
3. Make childcare funding universal again
4. Significantly lower the universal credit taper rate
5. Levy tax on a household unit basis like almost every other developed country

The current system is discouraging work at all level of earnings. I’d also suggest replacing child benefit with an additional tax allowance per dependent child as this encourages work (this is the approach in most countries).

These measures would double our economic growth rate which would leave everyone (including the treasury) substantially better off.

Agree.

– £100k is not a 'tremendous' salary anymore
– People on £100k+ are paying enormous amounts in tax
– Tax brackets haven't moved in so long that everyone has been badly affected by fiscal drag
– The £100k cap was introduced almost 10yrs ago. £100k now is £135-140k.
– It discourages women from getting back into work if they choose to, and it encourages £100k+ earners to pump more earnings into tax free solutions – all meaning much less tax income for the country.

It's an archaic cap and it's a no brainer.

But they are the ones that need the help as they are actually at work. Meanwhile people sat on their asses all day contributing nothing get free child care. You can't make it up.

I don't think folk on £100k should be subsidised by the taxpayer.

What does this contribute to the discussion?

With two in nursery in 2026 you would still end up with an effective ~80% tax rate between £100-200k with this policy.

Folks on salaries of £100k+ PAYE are significant taxpayers. They’re doing a huge amount of subsiding and I don’t think it’s outrageous to want to benefit from a public service they pay into.

if you have no childcare hours as one of you earns £100k then for a lot of careers it makes no financial sense for the other party to work. Teachers, teaching assistants, nurses, research scientists and so on. Real people in important but low paid jobs just priced out of working.

People on £100k ARE the taxpayer - we should be encouraging them to pay more tax, not incentivising them to pay less.

(And, no, I don’t earn that myself before anyone comes at me)

Why not?

Folk on £100k are the taxpayer. They pay far more into the pot than those on average wages. Why shouldn't they get the same advantages as the rest of us?

You pay a lot of tax on 100k and typically need to pay a lot in childcare in order to be able to earn that so why shouldn’t you get some support in those high cost years - reimbursement of some of the tax

They'd just be funding a service they use instead of funding it just for others as well

It’s not. I’m in the North West and my nursery has just increased fees to £80 a day. That’s 20400 a year. Ironically to cover the underfunded funded hours.

I am able to use the funding but because of ‘discretional’ fees in real terms 30 hours stretched works out at a discount of 2 or 3 days a month.

Im on the fence with this one. I can see how the cliff edge is unfair but seriously, if you earn 100k, how do you think people earning less cope? As a senior nurse, I earn 49k.

It sounds like some of you on 100k are expecting more services because you pay more tax. Does that mean that you are more deserving of services than those earning 49k?

Where does it end? Should the person earning 20k not have 1000s of pounds worth of cancer treatment because they haven’t paid enough tax to cover it?

If we want public services surely we have to expect that higher earners will be paying more towards it…?

Why should they get help from low paid people. The whole benefits system has gone crazy. If there was less paid out in benefits taxes would be lower and folk on £100k woulen't need childcare subsidies.

It sounds like some of you on 100k are expecting more services because you pay more tax. Does that mean that you are more deserving of services than those earning 49k?

They obviously aren’t more deserving, but why are they less deserving of services?

I don’t think anyone earning £100,000+ needs the rest of us to pay for their children to go to nursery

Why?

they pay their taxes too

You’re not doing any maths.

£100k cut off was created at a time when living costs were a bit cheaper. It needs to rise with inflation.

£100k is also sometimes supporting 4 people isn’t it. Maybe this person’s partner earns a lot less. Maybe they have 2 kids so double the nursery fees.

Not unreasonble at all! High earners should of course get less support but current set up gets it all wrong. This calculator shows just how much you end up losing by earning more childcaretaxcalculator.co.uk

I voted yanbu
As you say its the cliff edge and the other aspects that kick in at this level ie marginal tax rate of 60%
Yes its a very healthy eage. But all these issues together cause a massive behavioural shift which will be getting worse
All shoukd be much more gradual, even if that partly means starting at lower level
Its no different than the 20 hours before benefits get cut rule. It may be the opposite end of the scale but the behavioural impact isn't all welcome

They are the taxpayer. They are subsidising everyone else. Allowing them to access what should be universal benefits won’t change the fact that they are still paying for themselves and subsidising everyone else. Actually being allowed to use the services they pay for, for themselves and for others, is not “subsidising them”. 🙄

I’m not expecting more services. I haven’t said that we should be getting 40 funded hours, rather than 30 for example. I’m not even arguing that we should be eligible for child benefit in addition to the funded hours. I just think that the 30 hours should be a universal benefit, or if it has to be means tested to ditch the cliff edge because cliff edges are bad policies.

I’ve said repeatedly I’m happy to pay more tax, and I haven’t seen anyone once say that lower earners shouldn’t receive public services, but I’ve been told several times that any household with a salary of £100k+ shouldn’t be eligible for any public services, with no clarification when I asked as to which services I shouldn’t get. All I’ve said in regards to having a higher tax burden is that it seems fair to have the same working benefits we pay for - otherwise it seems we’d pay for nursery three times. Once in taxation to cover the funded hours for everyone else’s children. Twice for our child’s nursery provision. And a third time in the inflated cost of nursery per day to cover the gap in the funding from the government and what it costs to provide a place for the funded children.

It’s not about the rest of us paying for it, it’s about giving something back to people paying large amounts of tax

There are people wholly reliant on the state who receive not far from 100k in benefits!