The British government is set to announce an overhaul of allowances for childcare. Under the current scheme parents can claim up to £55 a week, tax free, to cover childcare costs. From 2015 parents will be able to claim up to £1,200 a year or 20% of childcare costs back. This is from an expected £6,000, classed as an average cost of childcare in the UK, which has one of the highest costs in the world.
Ministers are said to be over the moon that a deal has been strcuk. They hope that those parents who claim it is not cost effective for them to work will be spurred into action. One problem with this stance is a lack of jobs in the UK.
Currently the government pays childcare costs, to eligible parents, with vouchers. This scheme will be scrapped. So how will the new childcare claim back be funded?
Money saved from scrapping the voucher scheme will go toward the cost. The rest will be from "funding switched from elsewhere in Whitehall" reports the BBC. Now who will lose out to fund this scheme we wonder?
UK PM Cameron and his deputy Nick Clegg pledged to ease the costs of childcare in their mid-term revue in January. It has taken time to reach an agreement and the deal which BBC's Newsnight reports today.
Will care be compromised with more children per carer?
Professional couples look set to be the biggest winners from these changes. Is it just more electioneering by Cameron and colleagues? They will after all want to woo middle class voters. By the time people realise what has been cut to fund childcare it will be too late.
Whether the new scheme is an improvement is any person's guess.
Note: UK spring budget Wednesday....updates then