Treasury Committee publishes Report on Childcare

On 25 March 2018 the Treasury Committee published a unanimously-agreed Report on Childcare, as a result of its recent Inquiry into Childcare Policy, which makes a series of recommendations to the Government including:

  • Remove age restrictions on childcare support for parents in training to improve productivity.
  • Keep the Childcare Voucher scheme open until the winners and losers of discontinuing it are known.
  • Pay a higher hourly rate to local authorities for the 30-hours free childcare scheme (currently available in England).
  • Improve awareness of the Tax-Free Childcare scheme and quality of the website.

The Report highlights a number of issues with Tax-Free Childcare in terms of:

  • Low level of take up
  • Lack of awareness of the scheme
  • Parents preferring to remain on the Childcare Voucher scheme
  • Childcare Providers not registered to accept Tax-Free Childcare
  • Issues with the childcare services website
  • Complexity of the registration process
  • Inadequate information and Government guidance.

With reference to the closure of Childcare Vouchers, the Report finds the Government’s announcement (13 March 2018) of a six-month extension of the Childcare Voucher scheme, shortly before it was due to close to new entrants (6 April 2018), could have resulted in parents who would have been better-off under Childcare Vouchers having already made arrangements to start using Tax-Free Childcare. The Treasury Committee expects the Government, in its response to this Report, to provide:

  • an economic analysis of who will gain and who will lose out in any transition from Childcare Vouchers to Tax-Free Childcare, and
  • a comparison between the programme and administrative costs of the two schemes.

The Report calls for the Government to consider keeping the Childcare Voucher scheme open, at least until this information is available, as only then will it be possible to understand the extent to which parents are likely to be better or worse off.

Finally, the Report calls for a specialist childcare support helpline that covers all of the major childcare schemes, with advisors who can help individuals with more complex circumstances, explaining what might be the best choice of scheme for them. It highlights the difficulties for parents in choosing the scheme that is right for them, particularly given that their circumstances are likely to change over time.

Employers For Childcare’s Family Benefits Advice Service was specifically set up to ensure families claim the best support available to them, particularly with childcare costs. Call 028 9267 8200 or email to find out what financial support for childcare is best suited to you, and identify any other benefits to which your family may be entitled.

Employers For Childcare is lobbying for a comprehensive and flexible package of childcare support for parents that includes Tax-Free Childcare and Childcare Vouchers, so that parents have the choice of the scheme that best suits their needs. Visit our Lobbying page for more information.