PLEASE READ: Childcare Gov Budget Update

Hope you all find this useful! :)

BUDGET BRIEFING 2013

This afternoon the Chancellor, George Osborne, announced what he called his “budget for an aspiration nation”. Changes to childcare vouchers that we announced yesterday.

New childcare scheme from Autumn 2015 - as announced yesterday a new childcare scheme will be introduced to support working families with their childcare costs. For childcare costs of up to £6,000 per year per child, support of 20% will be available worth up to £1,200. From the first year of operation, all children under 5 will be eligible and the scheme will build up “over time” to include children under 12. The scheme will provide support for families where all parents are in work and not receiving support through the Childcare Element of Working Tax Credits/Universal Credit, or where one parent has an income over £150,000. Support will be provided through a childcare account redeemable through any registered childcare provider. Important points to note include:

- The new scheme will commence in Autumn 2015 (running alongside existing childcare voucher schemes for a while as the current system of Employer Supported Childcare is phased out).

- Both parents must be working for the new benefit to be claimed by the household.

- The benefit (or relief) can be claimed per child, rather than per household.

- Initially, this new scheme will cover children up to the age of 5 only.

- The parent will continue with an online voucher account, which the Government will top-up.

- The scheme will continue to be for registered childcare only.

Comment: there will be a messy period where the two schemes run side by side and it will be confusing for employers and employees alike. This will also impact employers who will lose national insurance savings when the new scheme is no longer run on a salary sacrifice basis.

5 Replies

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  • Aspiration nation my arse! Both my other half and I are 'council house kids'. Both have worked hard and done well for ourselves - first to stay on to 6th form (actually only ones to stay on!), both our families first university graduates. Both have huge study debts to show for it.

    Unfortunately both in jobs hit hard by the budget. The new child care scheme leaves us worse off, we don't qualify for child allowance as no account is taken of our student and professional loan out goings.

    Part of me thinks I should have joined my school friends, got myself knocked up at 15 or 16 and moved in to my nice free flat!!!

  • Hi Dr Fluffy, I'm all new to this, as only 6 weeks along, so not aware of the current childcare situation. I just recieved this via email update, and thought it might be useful. Didn't mean to cause offence.

  • take my hat off to u dr fluffy they should be paying ur fees...helping those who are giving back to society drs nurses and midwives are so undervalued by this government! They are a shambles!

  • "or where one parent has an income over £150,000"...surely this is a typo?

  • What i find ridiculous is that surely there is a MASSIVE difference between 150K salary and say 25K salary?? Which is completely unaccouned for by this scheme (or this government).

    This is a drop in the ocean, it baffles me childcare is not subsidised in this country, and then everyone is so surprised by the lack of women in managerial positions!!

    Sorry to veer off a bit, and thanks for the update Duppy! x

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