Current issues

Gingerbread’s campaign victory on childcare costs – why it’s so significant for you

On 7 October 2011 the Government announced an extra £300 million for childcare costs from 2013 – the result of sustained campaigning from Gingerbread and a coalition of children’s charities. 

But what does this mean for you?  It means that from 2013 money will be available for childcare to cover part time and mini jobs – helping many single parents to get back into work in a way that fits around school or nursery hours.  It also means work will continue to pay for those who want to work more than 16 hours a week to bring in a better income. The current tax credit rules – where you can claim up to 70% of childcare costs up to a maximum of £175 per week for one child, or £300 per week for two or more children – will be extended to all parents from 2013, whether you’re working below or above 16 hours per week.

In the current economic and political climate, it can sometimes feel like it’s hard for our campaigns to get results.  Some of our members have expressed understandable frustration when action they take doesn’t come up with quick results.  But this achievement shows we really can change government thinking and that, with persistence, we can make a difference.

One of the major turning points for the campaign was some research that Gingerbread and the Resolution Foundation commissioned from academic Donald Hirsch at Loughborough University.  His report showed that measures in the Welfare Reform Bill would not deliver the government’s aim of ‘making work pay’ if the increasing cost of childcare wasn’t addressed.  Our analysis of the financial impact on families, which got the attention of both politicians and the media, exposed how the government proposals would trap many parents in low hours jobs, unable to move up the ladder.  We were told by senior civil servants that this research had made a significant impact.  Alongside 20 other childcare and children’s charities, Gingerbread has spent the last few months building pressure on government and opposition MPs to get this vital concession.

Many thanks to all of you who have supported this campaign, including by providing vital stories to the media about what impact this would have on the ground. There is more to fight for on childcare, but we believe this is a really important step on the way to providing proper support for single parents to get into and progress in work.

Our other campaigns, on issues like charging for access to child maintenance, will also now carry on with renewed vigour!

Back in October 2010, the goverment announced the results of its conprehensive spending review (CSR).  This was our response to the cuts. 

Government spending review hits single parent families hard

 
Gingerbread condemns the government’s spending review for cutting support for families and children, for failing to protect vulnerable families, and for not making work pay.

 “Single parents will be hit hard by reductions in help with childcare costs and a freeze on working tax credits. On top of cuts to housing and council tax benefit and a freeze in child benefit the effect will be years of misery and austerity for the most vulnerable families, who will see real reductions in their weekly income. The government says it wants to make work pay but this is a big step backwards for single parents in jobs and for those wanting to get back to the labour market. It has failed to protect families on the lowest incomes, instead exposing them to deeper disadvantage,” said Gingerbread’s chief executive Fiona Weir.

The decision to cut help with childcare costs for parents receiving tax credits - from the current maximum of 80% to 70% of costs - is bad news for working single parents and for those trying to find a way back to the jobs market.

These cuts will hit hard: 60% of people receiving childcare tax credit are single parents.
 "This is a bitter blow for working single parents who are already struggling to keep on top of childcare costs and for whom this support is essential,” said Fiona Weir of Gingerbread.
The changes mean a single parent in London who is working part-time for 21 hours a week (25 hours including travel time), with a three-year-old child in nursery, will have to find an additional £505 per year out of their earnings to spend on childcare costs. 

Spending review: how it will affect single parents

- The basic and 30 hour elements of working tax credit will be frozen for three years from April 2011

- Help with childcare costs for parents receiving tax credits will be cut from the current maximum of 80% of costs to a maximum of 70% from April 2011

- The child element of the child tax credit will be increased by an additional £30 per year in 2011 and £50 in 2012

Other announcements that may also affect single parents include:

- A reduction in council tax benefit (to be decided locally)

- Total household benefit payments to be capped at £26,000 per year

- Removal of child benefit from families with a higher rate taxpayer from January 2013

- Removal of education maintenance allowance for 16-18-year olds

- Extending 15 hours a week of early years education and care to all disadvantaged two-year-olds from 2012-13, and maintaining the universal entitlement to 15 hours for all three and four-year-olds

- For new tenants in social housing, rents are likely to be higher than current rent levels (up to 80% of market rents) and tenancies are likely to be for a fixed period rather than for life. Existing social tenants will not be affected.

You may also have read about changes to the eligibility rules so that couples with children must work 24 hours a week between them, with one partner working at least 16 hours a week, in order to qualify for working tax credit. Please note that this change only applies to couples and not to single parents.

Read our press releases on the spending review in our media centre.

If you want help and advice on these issues, contact our free helpline.