"Ed Balls' reply to my Childcare agitation. Suggestions needed." blog discussion

SusanC_2

WelshGandalf wrote: »

How about money for childcare costs if there are 2 parents and one of them stays at home to look after the kids?!

I agree. I don't get paid to do my job (SAHM) but if I went off to do another job which was paid, the government would pay someone else to do my job (looking after my child) for me. Actually rather than pay SAHMs, why not just scrap free childcare? Surely the only reason it is profitable for both parents to work is because the government is subsidising the childcare and why should they get extra money from the government just because they are doing a different job?

smartbear wrote: »

Related irrationality re childcare & tax credits that I'd really like raised: I work as an Ofsted Registered Childminder. The number of children I care for at any one time is - rightly - strictly limited by the terms of my Registration. Parents of these children can claim Childcare Credit - but unless I place my own child/ren in a nursery or with another Minder I can't claim, despite the fact that my own child takes up one of my childcare places. For example if I'm registered to care for 3 under 5's and my own child is 4, then one of those places is taken by my own child reducing my potential earnings by a third. They receive the same high standard of education and care as the other children & I don't want to place them elsewhere - so why shouldn't I be able to claim Childcare credit like any other parent for that place??

By that logic, every parent should be paid to lok after their own child.

tomtoogood80

Hi Martin,

I read your article on childcare vouchers and tax credits and had to post a reply as I have had first hand experience of both payments.

Last year I was informed by Tax Credits that my wife and myself had been overpaid by over £3000.... The reason being that we had been paying for most of our childcare with vouchers via my employer but had not deducted this from our childcare amount that we declared to the tax credits. After disputing this and getting my MP involved we won the dispute and the overpayment was written off.

The reason it was written off is that on the tax credit renewal forms there is NO explanation of how to calculate childcare costs oif you claim vouchers. The only way to know is to find it on the tax credit website hidden away or to call and ask for advice, which varies drastically depending on the person you speak to!

The official delcaration that you make when you fill in your tax credit form is that you have filled it in accurately and in line with the guidance in the renewals pack. As there is no explanation of how to calculate childcare costs when claiming vouchers you are under no obligation to declare this, but you do run the risk of being overpaid!

I made this mistake inncently and the stress this put me and my family through was immense, the money coudl have broken us if it had of been claimed back.

I know of friends that still claim both and they are getting over twice the amount of tax credits than we are, which leads to a totally unfair system. I am very careful when it comes ot money and count every penny and read every form... which is why I was shocked that I fell into this tax credit childcare trap! My concern is that alot of other people dont pay this much attention and are therefor claiming too mcuh tac credit... and relying on that money as you do when you need it, this coudl be pulled away from them at any time.

Isnt it time Tax credits and government made the guidance clearer on the forms at least so that people werent being overpaid unknowingly. I estimate that many hundreds of thousands of pounds if not millions are bieng overpaid every week to families who are claiming both childcare vouchers and childcare through tax credits

Please get back to me if you would like further information or explanations of this, I seriously think this is a BIG issue and have already had my local MP involved, it would be good to get this issue sorted out!

Thanks

excited_money_saver

I work for a Families Information Service - there is one in every local authority area. We can advise on the interaction of Tax Credits & Childcare Vouchers.

This service is not widely know but can help with so many of the questions people have.

We have good links with jobcentreplus outreach workers who can do back to work calculations to see if you would be better off in work and to make sure you are claimimg all you are entitled to.

Martin - if you can do more to publicise Families Information Services that would help. Also paying providers direct would help enormously, they can do it with Care to Learn and Free Childcare for Training & Learning for Work, so why can't they with tax credits. it helps the parent & the provider and can help eliminate fraud.

Ofsted rules are mad but Ofsted are so incompetent in many ways it will take a miracle to make them see sense.

The most practicle solution in my opinion would be the 1 years grace but HMRC and voucher providers will have to do more to get this to work better.

The real shame is that people do not know about either schemes at all so do not work/study when they want to or struggle to pay for childcare or use informal childcare which is not as good quality.

http://www.familyinformationservices.org.uk

There is specialist help available.

MSE_Martin

excited_money_saver wrote: »

I work for a Families Information Service - there is one in every local authority area. We can advise on the interaction of Tax Credits & Childcare Vouchers.

This service is not widely know but can help with so many of the questions people have.

We have good links with jobcentreplus outreach workers who can do back to work calculations to see if you would be better off in work and to make sure you are claimimg all you are entitled to.

Martin - if you can do more to publicise Families Information Services that would help. Also paying providers direct would help enormously, they can do it with Care to Learn and Free Childcare for Training & Learning for Work, so why can't they with tax credits. it helps the parent & the provider and can help eliminate fraud.

Ofsted rules are mad but Ofsted are so incompetent in many ways it will take a miracle to make them see sense.

The most practicle solution in my opinion would be the 1 years grace but HMRC and voucher providers will have to do more to get this to work better.

The real shame is that people do not know about either schemes at all so do not work/study when they want to or struggle to pay for childcare or use informal childcare which is not as good quality.

http://www.familyinformationservices.org.uk

There is specialist help available.

It is a good service and I have given its phone number out scores of times on TV and radio.

Cazzoh

I spotted this a number of years ago when I was debating going for the vouchers.

I must admit, and its not very often you hear something good about the Child Tax Credit people, but I did ask them giving them the differences and they did tell me the two different amounts I would receive - it was about £40 a week less if I took up the vouchers.

I use to advise friends that, to be honest, if you get child/working tax credit, vouchers are no good to you but if you don't get it - or get very very little, then the vouchers are better.

npw32jnw

Basically, the tax credits system is designed to put people off claiming, and to frighten people into submission - how else do you explain getting a pack through which says 'if nothing has changed you need to do nothing more', then seeing govt adverts saying 'if you do nothing your money will stop'. The whole system is a complete mess and needs to be scrapped. How hard would it be to go back to providing assistance via tax codes - yes more people might get more money, but the cost of this beaurocracy would be saved - I bet there would be a net benefit to the govt.

Finally, to the person (Spindoctor I think) who says don't have kids if you can't afford them, I reply that we will all rely on our kids to look after us (i.e. paying their share of the taxes) in our old age - or does he / she not want any assistance from the govt in their older age? This is not just an issue which affects the lowest paid, it affects families all across the country - surely having children should be seen as a good thing for the country, not a burden. Every family (except the super rich) get hit when they have kids - I and my wife have 3, and can afford to payfor them, but the extra we get in terms of credits (which are a nightmare to get sorted and then keep renewing) helps us to produce well rounded kids (not just through schooling but other pastimes) - is that not a benefit to society as a whole?

SusanC_2

npw32jnw wrote: »

Basically, the tax credits system is designed to put people off claiming, and to frighten people into submission - how else do you explain getting a pack through which says 'if nothing has changed you need to do nothing more', then seeing govt adverts saying 'if you do nothing your money will stop'. The whole system is a complete mess and needs to be scrapped. How hard would it be to go back to providing assistance via tax codes - yes more people might get more money, but the cost of this beaurocracy would be saved - I bet there would be a net benefit to the govt.

Or get rid of all taxes and just have a single charge per household. Think how many millions would be saved in administration and how much time everyone would save not having to do tax returns and claim tax credits.

npw32jnw wrote: »

Finally, to the person (Spindoctor I think) who says don't have kids if you can't afford them, I reply that we will all rely on our kids to look after us (i.e. paying their share of the taxes) in our old age - or does he / she not want any assistance from the govt in their older age? This is not just an issue which affects the lowest paid, it affects families all across the country - surely having children should be seen as a good thing for the country, not a burden. Every family (except the super rich) get hit when they have kids - I and my wife have 3, and can afford to payfor them, but the extra we get in terms of credits (which are a nightmare to get sorted and then keep renewing) helps us to produce well rounded kids (not just through schooling but other pastimes) - is that not a benefit to society as a whole?

Do you think the average person chooses to have children as a service to society?

aah

I wish you good luck with this Martin, common sense suggests you will win it but unfortunately it is complicated. I do agree it is an unintended consequence rather than policy to deprive parents although some will accuse this government of anything.

I support anything that makes life easier for working parents. I brought up my children under the Tory government when there was NOTHING for us who earned 8 and 9 grand respectively hardly a fortune even ten to twelve years ago. but GOT NOTHING from the government towards our childcare costs.

Yet now as our incomes have increased a little, it is us who are having to contribute to student loans etc etc and by the time our kids have their own kids Tories could be back in and they will cut all these decent benefits for poorer families.

Ho hum, I could go on, but I have done already - best wishes for the meeting, I am sure he will be sympathetic, keep up the great work.

Anne

Errata

Wasn't this mare's nest created when Brown was Chancellor ? If so, it was devised by Brown's brain - Balls. So good luck at getting Balls to give any indication that anything of his devising was less than perfect.

sdooley

If you think the system is complex now it will only get worse if you try to introduce 'neutrality'. Remember tax credits have a withdrawl rate (if you earn more you get less) so this formula (which is already complex) would have to be further tweaked - quite possibly resulting in people who get pay rises ending up with less money in their pocket (unless you make further tweaks, at further financial and administrative cost).

These are two good schemes but they overlap so it'd be worthwhile people having a tool to work out which one is better for them. Of course if we switched over to universal benefits (or directly subsidised childcare provision) then thereäd be far less bureacracy and none of this hassle - but then people complain we're 'wasting' money subsidising millionares' children - in my mind it's no waste to spend government money on the rich (if they get no more than everyone else) it ties them into the system and makes them less likely to go non-resident.

In the absence of radical reform, the best answer to this question is better information.