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?

Should those on higher incomes be allowed to use state schools then? Or asked to pay a stipend to use them?

I can’t see why school and nursery would be treated so differently.

It depends on your definition of ‘we fund’ and perspective really. Only 46% of people are net tax payers, the rest are recipients and don’t fund anything. People earning over £100k actually pay 45% of all income tax.

Instead of I don’t think ‘we need to fund nursery for those with much higher than average salaries.’ What you’re really saying is that you think people who actually do fund free nursery places should be denied them.

I know that. I was responding to a post that said if they changed it to a HOUSEHOLD income of £100k it would damage the economy. I don’t think it would do as much damage as the current £100k limit.

It’s not even £5,000 a month with student finance. Our nursery in the West Midlands without the funding is £92 a day. We had two children in nursery at the same time - that’s £4,000 a month for nursery.

We just avoided the threshold but if we hadn’t I would have had to step back from work until we were out of nursery. I work for a local authority in a specialised role that was vacant for years before I took up the post. The impact is that up and down the country women are stepping out of the workforce, usually from professional roles, to offset the cost of childcare. I would bet that has a bigger economic impact that funding school places.

That analysis was already done. Jeremy Hunt commissioned economic research on why UK productivity and growth was so low and one of the key drivers (obviously) was these cliff edges in the tax system that disincentivise work. As I said earlier, any Government that wanted growth would:

1. Make the personal allowance universal again
2. Make childcare funding universal again
3. Make child benefit universal again
4. Levy taxes and allocate tax allowances on a household unit basis like pretty much every other developed country to remove economic distortions
5. Significantly lower the universal credit taper rate

The evidence is already gathered and was passed on the RR. In fact, pre-election she was asked about this when she took questions in a Mumsnet interview and she said “it’s not a priority”! 😆 Utterly clueless. No wonder the country is such a mess.

There is evidence showing that the above measures - entirely within Government control - would not only benefit the individuals affected by these incoherent policies but would likely double the UK growth and productivity rates and therefore raise living standards for everyone and increase treasury tax revenues, reduce the welfare bill and also of course decrease the need for immigration because UK citizens wouldn’t be financially penalised for working more. It’s a no brainer, but I guess we are being led by people with no brains so… 🤦🏻‍♀️

Obviously if tax thresholds an allowances were allocated on a household unit basis they would be higher than the individual thresholds.

Nope, single earner households are penalised far MORE at the £100k threshold. You haven’t understood the maths.

Yes, but my point is that we have gone way beyond the point of paying our fair share. The social contract is being abused.

Well said.

Or put differently:

”I want to keep more money from those folk that already pay the most for the benefit of others because they don’t deserve to have the same access to services as everyone else just because they’ve had to pay for it because…. They’ve got the broadest shoulders”.

it’s an issue with policy in general. Everyone wants those that earn more to give more whilst forgetting they already disproportionately do….

And has been pointed out above, it wouldn’t cost much at all to get your highest rate taxpayers back on board, to show them that the social contract still works. RR just doesn’t want to be seen by people as giving ‘freebies’ to rich people, even though the only people thinking this have little understanding of the economics involved.

All of the bizarre tax marginal rates need changing.

The one where benefits are removed at a high rate.
The one at higher rate where child benefit is clawed back
The one at 100k with childcare and 60% marginal rates

All three create illogical and undesirable results. Just up the base rate of income tax or the start of the band.

Wholeheartedly agree with you.

This is obviously the entirely logical thing to do and would boost growth BUT she stupidly promised not to increase income tax (or NICs or VAT) and therefore massively shot herself in the foot.

She should have upped rates, made personal allowance, childcare hours and child benefit universal in her first budget and by the next election it would have been forgotten about but she’s a poorly advised fool so didn’t and were stuffed, living in a highly taxed growth free environment where we’ve made it financially ruinous to be productive. So achingly stupid. We need better politicians.

All the cut offs need to be reassessed.

My sister was great at her job (factory work), reliable and efficient. They frequently tried to promote her and she continually refused because the amount she would lose in universal credit wasn't made up by the increase in income. If the threshold had been higher or there had been a transition period she'd have been off benefits sooner and paying more tax.

It defies any logic and is already proving to be a slow moving economic car crash, but I think what is even more damaging is the divisive and quite frankly ludicrous rhetoric used by the Government towards high earners and their children.

Because 100k salary is about £65k post tax and a full time nursery place in london is £30-35k per year.

non-subsidised childcare costs have risen substantially DUE TO funded hours… that’s the most unfair part of it all!

Yes. Just as those who aren’t disabled don’t need the accommodations that we afford disabled citizens or those that aren’t old don’t live in old peoples homes with carers. You don’t seem to understand, our taxes aren’t to give to all they are to give to those that need it.

There will be families who get free / subsidised childcare places so have a higher disposable income than families who don’t, after childcare is taken into consideration.

”Need” is quite subjective. There are much fairer ways of funding childcare than this ridiculous cliff edge we have currently.

And most other European countries use their taxes to pay for ALL because they deem if you pay in you get services out. The UK is an outlier here. The higher paid are seeing the contract isn’t working for them at all, hence all of the young professionals choosing to base their lives elsewhere.

Young professionals go where the work is not where the free childcare is. It’s a few very short years and presuming you have the skills that usually accompany a larger project come you should be able to spread the cost. What is wrong with paying for your own children?

But why do we not need to fund nursery places for those paying the most taxes?
nursery places are needed for them to go to work and pay these taxes, it is effectively a cost for working.

how are we incentivizing people to work if they have nothing to show for it.

How is a £100k salary nothing to show for it?

What do you mean by spread the costs?

It’s called saving up for the things you want.

Childcare costs have jumped 48% on average in the same period of time wages grew 12%.

Childcare costs have grown BECAUSE of the (under)funded hours and therefore higher earners are being extra penalised because they have to pay the inflated costs to make up the shortfall left by funded hours.