Kemi Badenoch has pledged to scrap “absurd” rules that strip parents of their right to help with childcare. Under current rules, when one parent's earnings pass the £100,000 mark – even by as little as £1 – they automatically lose their entitlement to 30 hours a week of childcare support.
Abolishing the threshold
Mrs Badenoch is promising to abolish this threshold if she becomes prime minister, in a bid to support families and encourage economic growth. The Conservative leader will make her commitment to end the childcare “cliff edge” today as her party's conference kicks off in Birmingham.
Conservatives warn the present system can leave working parents “tens of thousands of pounds worse off”. They argue that the loss of the 30 hours of support and the denial of access to the tax-free childcare scheme means some mothers and fathers are “better off” earning less than £100,000. They say the status quo “punishes parents for working more, working harder, seeking a promotion or moving to a better-paid job”.
Impact on families
Tories claim a “parent with two children at nursery in London would need to earn nearly £150,000 to be better off than earning just below the £100,000 threshold”. There is concern couples will choose not to have children, or delay starting a family, until their incomes change. Conservatives also argue it is unfair the present threshold is based “on an individual earner's income” and not on household income.
Mrs Badenoch said: “Conservatives believe that you shouldn't be punished for working more, but this childcare cliff edge does exactly that. I'm a mum of three and I've had to make the same choices many families have had to make on work and childcare. Those choices are difficult already, Government should not be making them harder. It is absurd that earning just one extra pound can leave a family thousands of pounds worse off. No one should be turning down a promotion or a pay rise because they literally cannot afford to earn more... It is often women who end up carrying more of the childcare responsibility so a system that makes it harder for them to progress in their careers is not helping families, it is not helping women and it is definitely not helping the economy.”
Cost and funding
Shadow Chancellor Andrew Griffith described removing the new policy as a first step in delivering “lower, simpler, and fairer taxes across the board”. The policy is expected to cost £700million a year and would be paid for by reducing the number of public servants in “non-departmental public bodies” – a move calculated to save £1.6billion in 2029-30. Such bodies include Arts Council England, Natural England and the Climate Change Committee.
Laura Trott, the Shadow Education Secretary, said: “The childcare cliff edge creates problems for families, workplaces and nurseries – it means promotions turned down, hours reduced and endless forms.” Under the changes, she said, parents would “have the freedom to make decisions about work and childcare based on what is right for their family”.
