Addressing the cost of childcare as a barrier to work

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By Aoife Hamilton, Policy and Information manager, Employers For Childcare

“I love my career, I worked hard at university to get a good job but I feel that I have little choice but to leave work/significantly reduce my hours because it simply isn’t worth our while for me to work and have pretty much all my wages go on childcare”

“Childcare costs have severely restricted our quality of life – we struggle and stress about money every month and it has had a severe impact on both our marriage and our mental health…all the while feeling guilty as we’re away from our baby trying to do our best for him and give him everything we can”.

These words, from working parents in Northern Ireland who responded to our 2017 Childcare Cost Survey, highlight the daily challenges local families face in combining work with childcare. Challenges that, in many cases, go beyond the financial. Childcare is the largest monthly outgoing for almost one third of parents, greater than their mortgage or rent. Close to half of parents reported their household has had to ‘go without’, or cut back, in order to meet childcare costs. It isn’t acceptable in 2018 that some working families struggle to heat their homes, or rely on foodbanks, in order to meet their childcare bill.

Families want to access high quality childcare, and recognise that providing this is expensive, which is why they are calling for adequate support from Government.

This is a situation that we believe will only worsen in light of the UK Government’s planned closure of Childcare Vouchers to new entrants, in October 2018. Of almost 7,000 relevant calls to Employers For Childcare’s Family Benefits Advice Service, 64% were better off using Childcare Vouchers and/or Tax Credits rather than Tax-Free Childcare (the scheme which the Government argues is a replacement for Childcare Vouchers).

This is why we are lobbying the Government to keep Childcare Vouchers, which can deliver up to £1,866 in annual savings to families, and can be used alongside Tax Credits or Universal Credit, open to new entrants permanently. It’s widely accepted that Childcare Vouchers help parents transition into work, and to stay in work, by supporting them with childcare costs. Why would Government take this much needed form of support away from those who need it most?

Parents who are registered with the scheme can continue to benefit, however, new entrants will not be able to join after October. Current users who change jobs will not be allowed to remain in the scheme as they will be deemed a ‘new entrant’. This will particularly impact staff on fixed/short-term contracts, those ‘on rotation’ (such as in the healthcare sector) and first time expectant parents due after the closure date.

We are asking parents, childcare providers and employers to get behind the campaign to #SaveChildcareVouchers by lobbying their local MP. Details can be found on our website – it’s quick and easy. It is vital that we stand together to keep Childcare Vouchers open for EVERYONE – all working parents deserve access to affordable and flexible support with childcare costs.

For many families on lower incomes, the best form of support will be Tax Credits or Universal Credit. Universal Credit allows eligible families to claim support of up to 85% of their childcare costs to a maximum of £646 per month for one child, or £1,108 for two or more children. Taking into consideration each family’s circumstances, it can be complex working out what is the best form of support. That’s why we are urging parents to check they are accessing all the support they are entitled to by calling our Family Benefits Advice Service on Freephone 0800 028 3008 for free, impartial and confidential advice.

• Employers for Childcare – https://www.employersforchildcare.org/

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