Isles SNP MP Angus MacNeil is urging parents to pay attention to planned changes to Childcare payment schemes and make sure they make an informed choice on the options open to them.
The way that some parents pay for registered childcare will change dramatically with the launch of the UK Government’s Tax Free Childcare (TFC) Scheme in early 2017.
The new scheme will allow some families to make savings, but many will get a better deal from an existing Employer Childcare Voucher scheme.
Mr MacNeil is now urging families to act now and find out what is right for them. Once TFC commences, parents will not have the option to sign up to an Employer scheme.
He has also lodged a Written Question to the Chancellor of the Exchequer asking what efforts are being made by the UK Government to ensure parents are kept informed of the changes ahead.
Mr MacNeil said: “There will be winners and losers with the start of TFC but parents deserve to be kept informed of their choices. If you are already part of a scheme offered through your current employer, you can continue to use this but you will not be able to sign up for this after the introduction of Tax Free Childcare.
“Some families could make more savings from Employer Childcare Voucher schemes rather than the Government scheme.
“For example a two parent household where both parents pay Basic Rate tax, with childcare costs of less than £9,330 a year, will save more through an existing childcare voucher scheme. In order to benefit you must sign up before the new Government scheme starts (early 2017).”
Current schemes, such as one operated by Comhairle nan Eilean Siar, offer a scheme where parents can purchase vouchers to pay for childcare from their salary before tax is deducted. TFC will be different in that it will offer top-up payments instead. Many private companies operating in Na h-Eileanan an Iar also offer such schemes to staff.
TFC may benefit some families – such as those who have very high childcare costs, the self employed and those whose employer does not offer a voucher scheme – but the new scheme will not be available for those families where only one parent is working and those on universal credit. The Government scheme will only be available for families with children under the age of 12 even though current Employer voucher schemes cover children up to the age of 15.
Charities are already warning of confusion over the changes and concern that parents may not act in time to sign up for Employer schemes before the deadline.
In 2013 a written answer to a Parliamentary Question showed that 540,000 taxpayers in the UK were in receipt of childcare vouchers in 2012-13, however a breakdown of figures for regional or constituencies are not available.