Childminders wanting to join the Government's 'home carer' scheme will be expected to give up their self-employed status and become employees of the parents whose children they care for, the Inland Revenue said last week, while parents who let them retain their self-employed status may face financial penalties for doing so.
The move looks certain to further put off childminders from applying to join the scheme, which has had a very low take-up since its introduction last month. Ofsted said that in England only around 20 childminders have been accepted as home carers to date.
A National Childminding Association spokeswoman said, 'We feel that this new ruling could have implications for the success of the scheme. If we discover that childminders are put off from taking part in the scheme, we will of course let the Government know.'
A spokeswoman for the Inland Revenue said it was unable to make an exception for home carers, because 'the tax and national insurance rules which apply to the self-employed are intended to recognise the particular circumstances of people who are genuinely in business on their own account.
'It would also remove access to certain contributory benefits, statutory sick pay and statutory maternity pay the worker may otherwise be entitled to.' She said the additional tax and national insurance costs borne by employers of home carers would be covered by the childcare element of Working Tax Credit. As for parents trying to get out of paying tax and national insurance by using the home carer on a self-employed basis, the spokeswoman said, 'Where the Inland Revenue carry out a review and find that the status of workers has been mis-categorised and PAYE should apply, then the employer may be liable for past years' interest and penalties.
'This is why it is important to get the status right from the outset and the Inland Revenue will be happy to advise.'
The Professional Association of Nursery Nurses (PANN) criticised the Government for snubbing nannies. Tricia Pritchard, PANN professional officer, said, 'A home childcarer post is a nanny's post and only nannies will wish to fill these posts. The Government seems determined not to recognise the nanny profession or the many thousands of very ordinary parents who rely on nannies for their home-based childcare.
'Very few childminders have expressed an interest in becoming home childcarers - whoever thought they would? Unless the Government finally agrees that the nanny exists, they are wasting taxpayers' money on introducing "no hope" schemes.'
