New childcare scheme set to save parents thousands

Sarah Barrett and daughter Erin.   Picture: OX64291 Mark Hemsworth

Sarah Barrett and daughter Erin. Picture: OX64291 Mark Hemsworth Buy this photo

First published in News

More than 19,000 families across the county are set to receive tax-free childcare next year.

Working families entitled to the benefit will receive up to £2,000 towards childcare costs in a scheme set to start in the autumn next year.

Figures show that thousands of families throughout the county will be entitled to the savings, including 3,920 in Oxford.

The scheme, announced during Wednesday’s Queen’s Speech, will be available for children up to the age of 12 and youngsters with disabilities up to the age of 17.

Single mother Sarah Barrett, from Rose Hill, returned to work nine months after daughter Erin, now four, was born.

She said: “I think, basically, that unless you are getting some kind of help it really isn’t worth women going out to work.

“Half a day’s childcare can cost around £130 a week for five half days. Some women don’t even earn that.

“It doesn’t pay to go out to work when you have children of pre-school age.

“The costs of childcare are very high and I think the Government is trying to help, but they just don’t live in the real world.

“They don’t see what families have to put up with and what we have to deal with financially.”

To qualify for the tax-free childcare package, at least one parent must be earning more than £50 a week, but no more than £150,000 a year.

Families receiving support through tax credits or universal credit will not be eligible.

For every £8 eligible parents pay for childcare, the government will pay £2 – equivalent to the basic rate of income tax.

Oxfordshire county councillor John Howson, who sits on the education scrutiny committee, said: “The announcement in the Queen’s Speech provides a huge boost to hard-working families across Oxfordshire. This is something Liberal Democrats have fought for and are now delivering in government.”

Mr Howson added: “We are committed to building a stronger economy and a fairer society – and this helps children get the best start in life.”

State support will be provided to 1.9 million UK families.

Existing childcare voucher schemes are due to be phased out as a result of the new measures.

How it works

The scheme will launch in the autumn next year and through the government website Gov.uk, parents will be able to open an online account.

Here they can deposit and withdraw money to cover the cost of childcare with a registered provider.

There will be a single log-in service where parents can view accounts for all of their children at once.

For every £8 paid in, the Government will contribute £2, equivalent to basic rate income tax.

Parents can pay into their childcare account whenever they like, allowing them to build up a balance for use during times when more childcare is needed.

Other family members and employers will also be able to pay into the account.

Who’s eligible?

Families eligible for tax free childcare across the county:

  • Cherwell            4,510
  • Oxford                       3,920
  • South Oxfordshire         3,990
  • Vale of White Horse      3,550
  • West Oxfordshire        3,040

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