Prime Minister Gordon Brown has responded to concerns over his decision to abolish tax relief on childcare vouchers.
During a question and answer with Mumsnet, a global online parenting network, the Prime Minister acknowledged that his plans to carry out a phased withdrawal of tax and national insurance breaks on childcare vouchers were a big concern for many working parents.
Meanwhile an official petition on the Number 10 website, which will be open until 29 September 2010, has attracted more than 47,000 signatures
Gordon Brown said: “I can see that childcare vouchers are a big concern to many of you, so let me take this opportunity to clear a few things up.
“Firstly, no one who is currently using the scheme will be affected in the next five years, so please don’t worry about any sudden changes. We are phasing in the changes so that families who currently benefit don’t lose out in the next parliament.
“Second, low and middle-income working parents will be able to benefit from childcare support through tax credits that are worth on average £68 per week for 470,000 families – much more generous than tax relief on vouchers.”
Brown said the current tax relief system was badly targeted, and particularly advantageous to the 6% of parents who pay tax at a higher rate. In addition Brown reiterated that the government was not actually abolishing the childcare vouchers and that the Treasury would simply be phasing out the tax relief. He said he expected that many companies will continue to provide support for childcare.
See also news report from 29 September 2009 on Childcare vouchers to be hit by phased withdrawal of tax and NI†breaks