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Childcare voucher scheme: Consultation set to be announced Childcare voucher scheme: Consultation set to be announced
(about 4 hours later)
Plans to introduce a childcare voucher system are expected to be put out to a 12-week consultation on Monday.Plans to introduce a childcare voucher system are expected to be put out to a 12-week consultation on Monday.
Under the scheme, families with two working parents earning less than £150,000 each would be able to claim back up to £1,200 a year per child.Under the scheme, families with two working parents earning less than £150,000 each would be able to claim back up to £1,200 a year per child.
The government has said the scheme, which was first announced in March, will benefit 2.5m working families.The government has said the scheme, which was first announced in March, will benefit 2.5m working families.
Labour said the government had already taken support away from parents and the plans proved it was "out of touch".Labour said the government had already taken support away from parents and the plans proved it was "out of touch".
Begins in 2015Begins in 2015
The UK has some of the highest childcare costs in the world, with many people with two or more children saying it does not make financial sense for both parents to work.The UK has some of the highest childcare costs in the world, with many people with two or more children saying it does not make financial sense for both parents to work.
When the scheme was announced, Prime Minister David Cameron said the plans, expected to cost £1.4bn, would be a "boost direct to the pockets of hard-working families".When the scheme was announced, Prime Minister David Cameron said the plans, expected to cost £1.4bn, would be a "boost direct to the pockets of hard-working families".
But some said it would penalise stay-at-home parents.But some said it would penalise stay-at-home parents.
Deputy Prime Minister Nick Clegg was accused of unfairly targeting "stay-at-home mums" by a caller to his weekly radio phone-in on London's LBC radio.Deputy Prime Minister Nick Clegg was accused of unfairly targeting "stay-at-home mums" by a caller to his weekly radio phone-in on London's LBC radio.
Details of the scheme will be set out following the consultation, but the new system is expected be phased in from autumn 2015, with children under five helped in the first year. The scheme will then build up over time to include all children under the age of 12.Details of the scheme will be set out following the consultation, but the new system is expected be phased in from autumn 2015, with children under five helped in the first year. The scheme will then build up over time to include all children under the age of 12.
Parents will be required to open an online voucher account with a voucher provider and have their payments topped up by the government.
For every 80p families pay in, the government will put in 20p, up to the annual limit of £1,200.
The vouchers will be valid for any Ofsted regulated childcare in England and equivalent bodies in Scotland, Wales and Northern Ireland.
To be eligible for the new support both parents will have to work - or the one parent in the case of lone parent families - and each parent must be earning less than £150,000 a year.To be eligible for the new support both parents will have to work - or the one parent in the case of lone parent families - and each parent must be earning less than £150,000 a year.
In two-parent families where one parent does not work, families will not receive support.In two-parent families where one parent does not work, families will not receive support.
Half of the funding for the new scheme will come from the abolition of the previous system of employer-supported childcare vouchers, and in part by funding switched from elsewhere in Whitehall.Half of the funding for the new scheme will come from the abolition of the previous system of employer-supported childcare vouchers, and in part by funding switched from elsewhere in Whitehall.
'Costs spiralling''Costs spiralling'
The government said it expected the new tax-free childcare scheme to eventually help 2.5 million working families. The government said the new scheme would help significantly more parents than the current employer-supported childcare voucher scheme, which is provided by only about 5% of employers.
It said that was significantly more than the current employer-supported childcare voucher scheme, which is provided by only about 5% of employers. But Sharon Hodgson, Labour's shadow minister for children and families, said: "Only David Cameron's government could be so out of touch that they expect families to be grateful for help with childcare in 2015 when they've already seen costs spiralling and support taken away.
Sharon Hodgson, Labour's shadow minister for children and families, said: "Only David Cameron's government could be so out of touch that they expect families to be grateful for help with childcare in 2015 when they've already seen costs spiralling and support taken away.
"This government has hit hardworking parents. Families with two children have already lost up to £1,500 in childcare tax credit."This government has hit hardworking parents. Families with two children have already lost up to £1,500 in childcare tax credit.
"This government promised to be the most family friendly ever but hardworking parents have lost out while millionaires get a tax cut." "This government promised to be the most family friendly ever, but hardworking parents have lost out while millionaires get a tax cut."