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Childcare voucher scheme: Consultation set to be announced Childcare voucher scheme: Plan 'will include parents who are carers'
(about 11 hours later)
Plans to introduce a childcare voucher system are expected to be put out to a 12-week consultation on Monday. The government says it wants to expand a new childcare tax credit scheme to include parents who stay at home because they are carers.
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. A 12-week consultation on the system - which was first announced in March's Budget - is expected to start later.
The government has said the scheme, which was first announced in March, will benefit 2.5m working families. Families with two working parents on less than £150,000 each would be able to claim up to £1,200 a year per child.
Labour said the government had already taken support away from parents and the plans proved it was "out of touch". The government has said the scheme will help 2.5m families, but Labour says families have seen a cut in support.
Chancellor George Osborne said the scheme - which will also include those on maternity or paternity leave - would give working parents "more choice and better access to the quality, affordable childcare".
"We want to make the new scheme work in the way that is best for parents, so today we are asking for their views," he added.
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. Chief Secretary to the Treasury Danny Alexander said: "The government wants to build a stronger economy and a fairer society and key to that is getting more people into work. We won't let childcare costs stand in the way of parents' ability to work if they want to."
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. To be eligible for the new support both parents will have to work - or one parent in the case of lone parent families - and each parent must be earning less than £150,000 a year.
But in two-parent families where one parent does not work, families will not receive support.
Critics say it will penalise stay-at-home parents.
Neil Leitch, chief executive of the Pre-School Learning Alliance, which represents childcare providers, called for universal childcare provision for all families.
He said: "This tax break does nothing to support those who choose to sacrifice their salary and put their careers on hold to stay at home and look after their young children.
"This seems to be more about dangling a £1,200 carrot to tempt mums back to work."
Katie O'Donovan of parenting website Mumsnet welcomed the scheme but also highlighted concerns over households where only one parent worked.
"A couple could earn £300,000 a year and still benefit. That doesn't seem sensible and is inconsistent with other cuts, such as those to child benefit and to childcare tax credit," she said.
Under the proposal, 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.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.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. Half of the funding for the new scheme will come from the abolition of the previous system of employer-supported childcare vouchers - which is provided by only about 5% of employers - and in part by funding switched from elsewhere in Whitehall.
In two-parent families where one parent does not work, families will not receive support. A separate scheme will provide funding for parents who claim universal credit. It will see the state will cover up to 85% of their childcare costs, up from 70% at present.
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. 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.
'Costs spiralling'
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.
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.
"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."