You are here: News Tax free childcare delay disappointing for cash-strapped parents
Responding to today’s Supreme Court judgment on the tax-free childcare scheme, Ellen Broome, Director of External Affairs, at the Family and Childcare Trust said:
"We welcome the ruling, however, many parents will be disappointed by the delay in implementation of the scheme, leaving them without extra financial support for childcare costs until 2017.
"It is now absolutely key that the new system is easy to understand and accessible for parents across Britain, and that the relationship between Universal Credit and Tax - Free Childcare is clarified. As we highlighted in our recent report, the Childcare Support Gap, there is a real concern that around 335,000 families could miss out on the vital financial help they need to pay for childcare and stay in work, because of the sheer complexity of the new childcare support system.
"It is essential that these issues are fully addressed and that the system is made parent-friendly before it is rolled-out in 2017."
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Contact: Mark Bou Mansour, Communications and Campaigns Manager. Telephone: 0207 940 7535, mobile: 07538 334 772, email: mark@familyandchildcaretrust.org.
Notes to editor:
The rollout was originally due to begin in September 2015, with employer-supported childcare vouchers being phased out and replaced by a tax free voucher, which will be worth up to £2,000 per child per year.
The Government acknowledged that there would be overlap between the two childcare support systems – tax free vouchers and Universal Credit – and in 2013 it estimated that about 50,000 families who will be receiving Universal Credit might be better off with the new tax free voucher (HM Treasury, 2013). The Family and Childcare Trust’s research led us to conclude this figure is an under-estimate. It does not acknowledge that families’ incomes vary from month-to-month or week-to-week, nor the growing numbers of self-employed people and those on zero hours contracts.
HMRC data shows that some 436,000 families were in receipt of the childcare element of Working Tax Credit in April 2014, out of an estimated 7.8 million families with dependent children. In 2012-2013, the average weekly help with childcare costs was £55.97 through Working Tax Credits.
Tax credits are being merged into the single Universal Credit, with 2017 being the target date for full implementation. The government announced in 2013 that it intends to increase the level of childcare support to 85 per cent of costs, up from 70 per cent of costs that parents receive today.
About the Family and Childcare Trust
The Family and Childcare Trust aims to make the UK a better place for families. We are a leading national family charity in the field of policy, research and advocacy on childcare and family issues, with over 40 years’ experience. Our on-the-ground work with parents and providers informs our research and campaigns. We focus on the early years and childcare because they are crucial to boosting children’s outcomes throughout life and supporting parents to work.