Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to the Tax-Free Childcare statistics, published March 2019, for what reasons 60 per cent of open accounts are not being used.

Due to the way Tax-Free Childcare is linked to 30 hours free childcare, a large number of Tax-Free Childcare accounts for 3 and 4 years olds are opened but not used to pay a childcare provider. This happens because a child who has a 30 hours account opened, will automatically have a Tax-Free Childcare account opened as well, if their parents are eligible. The reason for this feature of the service is to ensure a smooth customer journey for families signing up for 30 hours free childcare, so that they have a Tax-Free Childcare account ready for use when their child is no longer eligible for 30 hours free childcare.

Additionally, when a Tax-Free Childcare account is opened for a child, of any age, accounts will be opened for their siblings if their details are also entered during the application.