Childcare voucher concerns heard

Concerns over the scrapping of the tax relief on childcare vouchers are being heard by the Government and an announcement will be made next month, children's secretary Ed Balls has said.

A petition on the Downing Street website calling for the Government to keep the voucher system has been signed by more than 80,000 people. Mr Balls said it was "good for the Treasury to listen" and Chancellor Alistair Darling will address the issue of childcare tax breaks in his Pre-Budget Report on December 9.

A group of 88 MPs, including 50 from the Labour party, have backed a Commons motion that ending the system would reduce opportunities for two parents to work, widen the gender pay gap and impair the quality and affordability of childcare.

Working parents can opt to receive the first 243 pounds of their monthly pay in childcare vouchers before income tax and national insurance is deducted at present. The tax break saves 31 per cent on the first 243 pounds spent on childcare costs each month for basic rate taxpayers and 51 per cent for those on the higher rate.

In September, Prime Minister Gordon Brown announced that there would be no new entrants to the scheme after 2011 and that it would end for all in 2015.

Copyright © Press Association 2009
All articles are copyright The Press Association 2009. News articles provided by The Press Association for Family Investments. Whilst every care it taken to ensure accuracy of editorial content, Family Investments takes no responsibility for any errors or omissions. The views expressed in these articles are not necessarily those of Family Investments.

To find out more about childcare vouchers click here.