The childcare tax credit component of the Working Families Tax Credit will rise from June this year to reflect recent evidence on the cost of childcare across the country, particularly for under-fives. Parents with two or more children can claim up to 200 a week towards the cost of eligible childcare, up from 150 a week, and the Government will consider extending the childcare tax credit to help families who need to employ childcarers, such as nannies, in the home, for example those with disabled children and those who work irregular hours.
Chancellor Gordon Brown (pictured) also announced the minimum wage would increase from 3.70 to 4.10 per hour for workers aged 22 and over from October this year.
Scottish Independent Nurseries Association convenor for strategy Patricia McGinty said, 'I welcome the increase in the minimum wage because it will help to advance the professional status of the lowest-paid childcarers. As for the Working Families Tax Credit, at a recent meeting between SINA representatives and Paymaster-General Dawn Primarolo we managed to impress on her the need to offer parents transitional financial help when coming off benefits into work. Nurseries have to be paid in advance, and that was a stumbling block for many parents in securing places. She said she was aware of the problem and trying to rectify it.'
Maggie Simpson, the national development officer for the Scottish Childminding Association, welcomed the budget's broad emphasis on supporting families. She said, 'A lot of our members are on WFTC themselves, so they will benefit. It's good that those who are least able to afford good quality childcare services, which should be accessible to everybody, will gain from the Budget.'
Scotland was awarded 200m of additional funds made available for spending on key public services such as education and health. The Scottish Executive will decide how to allocate it.
The Scottish Pre-school Play Association also welcomed the minimum wage rise, but warned that it would increase the pressure on a number of groups which were already struggling financially and would inevitably result in higher fees for parents.
Shirley Norrie, national information officer for the Scottish Out-of-School Care Network, welcomed the Budget as a sign that the Government was acknowledging the cost of quality childcare, but warned that it needed to address the problem of fraudulent tax credit claims, which left some providers out of pocket.
