Tax-free childcare could make wealthy parents wealthier


The government’s new tax-free childcare scheme could boost wealthy parents’ finances because of the way in which it tops up families’ spend, according to Anand Shulka, chief executive of the Family and Childcare Trust.

Speaking at EB Live 2014, Shulka explained that the scheme, which will introduce a “20% top-up on childcare costs of £10,000 a year or more” for anyone responsible for the care of children under 12 years of age, will result in providing more financial assistance for parents and guardians who pay the most for childcare.

He added that funding should be “targeted at parents who face the greatest barriers at work due to childcare issues.”

The childcare scheme, which will be rolled out from September 2015, will see accounts delivered by NS&I rather than established childcare providers and comprise one account per child, which will be owned and managed by the child’s parent or guardian.

The account can continue to be used until a child is no longer eligible (over the age of 12).

Employers have no formal role in the new childcare scheme as it is administered by NS&I.

Some of the most popular child and eldercare services and benefits include emergency care, workplace nurseries and family-friendly working arrangements.

David Brackwell, head of wellbeing and inclusion in the UK and Ireland for Fujitsu, who was part of the session, stressed the importance of employers meeting employees’ childcare needs.

He said: “Almost 35% of Fujitsu have childcare responsibilities. Most of this demographic are 40-49 year olds and are most likely to face care arrangement challenges that may tarnish their workplace attendance and effort.”