Children: Day Care

(asked on 30th January 2018) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, if he will estimate how many families will benefit from the tax-free childcare scheme.


Answered by
Elizabeth Truss Portrait
Elizabeth Truss
This question was answered on 2nd February 2018

HMRC and Department for Education commissioned a feasibility study into evaluating the impact of new childcare policies on the childcare market. This is available at:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/499168/Feasibility_study_into_evaluating_the_labour_and_childcare_market_impacts_of_Tax-Free_Childcare_and_the_Free_Early_Education_Entitlement.pdf

The study concluded that it would be difficult to attribute changes in the childcare market definitively to a single childcare policy given the concurrent introduction of other childcare changes, and other external factors that could impact upon the market. However, HMRC and the Department for Education will be monitoring trends in the childcare market, and conducting research to understand parents and childcare providers’ views on the impacts.

For the current financial year 2017/18 we forecast there to be 130 full-time equivalent (FTE) staff in HMRC and 160 FTE within National Savings & Investments. We estimate that in financial year 2018/19 there will be 250 FTE staff employed in HMRC and 220 FTE within National Savings & Investments. These forecasts are reviewed regularly and are subject to change.

Regarding how many families will benefit from Tax-Free Childcare, I refer the Hon. Member to the response I gave to the Hon. Member for Newcastle upon Tyne North on 29 January (124793).

The Government has not made an estimate on the number of divorced or separated parents who will have to decide which of them will have the Tax-Free Childcare account.

HMRC have a process for dealing with different claims from such parents. The first parent that applies for a childcare account and is eligible, is given an account. If another person later applies for the same child both parents are contacted and asked whether they’re content to stand aside for the other applicant (so that the case can be resolved amicably). If they chose not to do this, both parents are asked to provide evidence in support of their claim. HMRC resolve cases based on the facts of each case. The losing parent can appeal, in which case both parents are party to the appeal.

Reticulating Splines