Childcare voucher providers campaign against plans to scrap tax exemptions

Childcare voucher providers have joined forces to mount a campaign against government plans to scrap tax exemptions on the benefit.

Gordon Brown announced last month at the Labour Party Conference that the current tax relief on childcare vouchers would be stopped by 2015, with the money saved being used to fund free nursery places for 250,000 two-year-olds.

Simon Moore, managing director of Computershare Vouchers Services, told Personnel Today that a group of 16 voucher providers had met to discuss the best way to fight the government’s proposals.

“What you will see is a united front because we want to give a single message and make it as easy as possible for ministers to make an evidence-based decision,” he said. “That’s not helped if a lot of people are saying different things. We are really working together to give a clear message.”

The providers will lobby government and shadow ministers to raise awareness of the facts surrounding the uptake of childcare vouchers and combat the misconception that the tax exemptions only help more affluent families. Computershare Vouchers Services surveyed 1,000 people using its service last week and found 74% were basic rate taxpayers.

A couple on the basic rate of tax would be £1,808 worse off and the removal of the tax exemption would add £14.8m to the collective childcare bills of key workers – including nurses, teachers and medical staff – who use them. This figure, Moore said, was the equivalent of taking £800 out the pay packet of a nurse.

Childcare vouchers have been voted the most popular flexible benefit offered by employers in a survey of 120 firms by consulting firm Hewitt Associates.

A petition to Number 10 calling for the government to stop plans to scrap the tax exemptions – supported by the voucher providers – has already received more than 44,500 signatures. An Early Day Motion has also been tabled by Labour MP Mark Durkan.

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