Working families lose out from closure of Childcare Vouchers: campaign calls for Government to re-open scheme at Budget

  • CVPA members have been inundated with distressed calls from working parents who have lost support following the closure of Childcare Vouchers.
  • Families where one parent is unable to work are locked out of the replacement scheme and are losing financial support.
  • Vouchers providers and charities are calling for the scheme to be re-opened at the Budget.

The Childcare Vouchers Providers Association (CVPA) is issuing a call for the Government to re-open the Childcare Vouchers scheme that closed to new entrants on 4th October. The call follows contact from distressed working parents who have lost out following the scheme’s closure.

The Government replaced Childcare Vouchers with Tax Free Childcare which provides less support to lower and middle earners and provides no support families with a single earner where there are two parents of working age. This switch has left thousands of working families worse off.

Distressed parents have been sharing their stories with CVPA members about the impact that the schemes closure is having on them. These include:

  • Single earner families left without access to any childcare support as Tax Free Childcare is only available to families with two working parents.
  • Parents left unable to change jobs as they will lose access to Childcare Vouchers if they change employers and they cannot afford to take the financial hit.
  • Parents working in exactly the same jobs in exactly the same circumstances as colleagues but receiving less support for childcare simply because they did not sign up to Childcare Vouchers before it closed to new entrants.
  • Families hit by a change of circumstance where one parent loses their job due to illness that are left unable to access any form of childcare support at all.

The CVPA is now calling for the Government to use the forthcoming Budget to re-open Childcare Vouchers to new entrants. Jacquie Mills, Chair of the CVPA, said:

“The closure of Childcare Vouchers to new entrants has hit thousands of working families hard, making it much more difficult for families that are just about managing to juggle the demands of work and childcare. The Government has an immediate opportunity to support these families by re-opening the Childcare Vouchers scheme at the Budget. This would be a simple and cost-neutral measure that would make a huge difference for a huge number of people.”

The CVPA has made a formal submission to HM Treasury outlining how the Childcare Vouchers scheme could be immediately re-opened to new entrants and continued to run within the existing spending envelope for childcare spending set by the Government. This would simple and cost-neutral.”

—ENDS—

Contact: Peter Jones on 020 3862 6799 or at peterjones@wacomms.co.uk

 

Testimonials from working families impacted by the closure of Childcare Vouchers to new entrants:

Parents have been sharing with us the impact the closure of Childcare Vouchers is having on them and their families. These real-life experiences illustrate the problems being experienced as the replacement scheme – Tax Free Childcare – is less generous for hundreds of thousands of working families. In the fortnight since the Vouchers scheme closed, the CVPA has been contacted by many working parents expressing their dismay at the government’s decision and outlining the negative impact it is having on them and their families. We receive more of these comments every day, but below is a selection from parents who have agreed to share their stories as part of our campaign.

 

  • “I’m starting a new job in a different city in October and will be unable to join Childcare Vouchers before it closes. As a newly single mum after a marriage breakdown, the closure of the scheme is yet another unfortunate event for me and my daughter. I’m sure there will be many others who don’t yet realise the impact the closure of the scheme will have on them until they change employer.” – Anonymous

 

  • “Thank you for supporting this campaign to #SaveChildcareVouchers. I had no idea of the impact the scheme’s closure would have, but when I received a new job offer, I used the government calculator and found I’ll lose out on hundreds of pounds towards my childcare costs if I change employment.” – Anonymous

 

  • “As I would change employer after the schemes closure, I will not be entitled to sign up to Childcare Vouchers at my new employer. With other financial losses, it is likely I will be forced to stay with my current employer despite having limited ability to develop as a professional female engineer, whilst also being a single mum. I will also be forced to suffer the increasing negative impact on my mental health caused by issues with my current employer.” – Anonymous

 

  • “My husband has just started a new job and unfortunately missed the payroll cut off to join Childcare Vouchers. This means we’ve now lost the childcare support we had under his previous job. As I’m a self-employed mum, we are currently eligible for Tax-Free Childcare, but I might not always have a job and could soon become ineligible. This didn’t matter when we received Vouchers – it gave us the flexible support we needed.” – Sam, Cumbria

 

  • “I’ve just been informed I won’t be able to benefit from Childcare Vouchers. Although I signed up for the scheme in September, I will only start receiving a taxable income from October, after the deadline, as I finished my PhD last month. My wife is still studying for her PhD , so we won’t be eligible for Tax-Free Childcare, and we don’t receive any tax credits. It seems very unfair that the Government is failing to support student parents who need more financial assistance.” – Anonymous

 

  • “I’ll be financially worse off as a result of the Government’s detrimental decision to remove the Childcare Voucher scheme, as will many other hardworking families and their children. We’re supposed to be seeing the end of austerity, not further hardship caused directly by decisions taken by this Government.” – Anonymous

 

  • “I’m starting a new job in January and despite having received Childcare Vouchers for almost three years in my current job, I’ll be considered a new entrant in the Government’s eyes and denied this support. This isn’t just an inconvenience, it’s a financial blow. Under Childcare Vouchers, it’s a comfort to know a good part of my daughter’s childcare is already paid for before I receive my salary.” – James, Swindon

 

  • “I asked my employer in February to give me Childcare Vouchers from September onwards before the scheme ended. Unfortunately, due to an error on their part, they failed to do so. I only found out about this after receiving my payslip and checking my account in October.

    Consequently, I cannot be on the Childcare Vouchers scheme and I am not eligible for the new government scheme. Due to an employer error, and HMRC’s inflexibility, I am now unable to benefit from Vouchers. This means an error I had no part in, or opportunity to correct, has cost me £1,250 over the next two years as I pay for childcare out of pocket with no tax savings.

    The reason I’m not eligible for the government’s new scheme is because I am the sole income earner. I’m the sole income earner because my wife had to leave her job due to being diagnosed with breast cancer two years ago, she is now thankfully free from cancer, but now has a weakened immune system, weakened bones, and gets ill regularly. I’m not going to ask her to go back to work. The intention of the childcare for my family is to benefit my son and to give my wife a break.

    Because the government has decided to end Childcare Vouchers, and because of an error on my employer’s part where they failed to put me on the scheme in time, I am out of pocket and not eligible for any government assistance.” – Greg, Essex

 

  • “I am disappointed to have missed out on thousands of pounds worth of support because of the closure of the Childcare Vouchers scheme. I thought I had signed up while on maternity leave in February 2018, but unfortunately it didn’t work due to a technical error. Just after the deadline I found out that I had not in fact joined. My husband had a similar experience due to a lack of support from his employer. 

 

We are very disappointed with the government’s decision to close the scheme. We now do not have the same benefits as other parents. The government Tax Free Childcare does not offer the same level of support. We also think that working families should be given more information about what is available, for example through health visitor information packs, rather than relying on individuals to find out for themselves. 

 

Luckily, we can combine nursery with help from our parents, but for those without family nearby or unable to help, this could be crippling as well as unfair.” – Emily, Glasgow

 

Notes to editors:

The campaign to #SaveChildcareVouchers has seen:

 

  • 278 employers, representing over 140,000 employees signed our business pledge to keep Childcare Vouchers, open including Barnardo’s, Kettle Foods, the University of Southampton, and NHS Grampian.

 

  • 69 MPs sign a second Early Day Motion, urging government to keep the scheme open until a more thorough analysis is completed of the ‘winners and losers’.

 

  • 119,000 people sign a petition to keep Childcare Vouchers open beyond the original closing date of April 2018.

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