The latest increase in the national minimum wage could lead to higher childcare fees and cancel out any tax relief for employer-supported childcare, the chief executive of the National Day Nurseries Association has warned. Rosemary Murphy gave her warning last week after the Government announced a rise in the adult and youth minimum wage to 4.50 and 3.80 an hour respectively from this October, and provisional plans to raise it to 4.85 and 4.10 an hour in October 2004. She said, 'With 70 per cent of the childcare fees parents pay going directly on staff salaries, the minimum wage rises mean we will see childcare fees rising well above inflation over the next two years.'
The latest increase in the national minimum wage could lead to higher childcare fees and cancel out any tax relief for employer-supported childcare, the chief executive of the National Day Nurseries Association has warned.
Rosemary Murphy gave her warning last week after the Government announced a rise in the adult and youth minimum wage to 4.50 and 3.80 an hour respectively from this October, and provisional plans to raise it to Pounds 4.85 and 4.10 an hour in October 2004. She said, 'With 70 per cent of the childcare fees parents pay going directly on staff salaries, the minimum wage rises mean we will see childcare fees rising well above inflation over the next two years.'
Mrs Murphy urged the Government to examine its proposals for employer-supported childcare and to raise the proposed 50 a week limit on which tax relief would be given. 'Unless this is done, fee increases will swallow up the proposed tax relief on childcare, leaving parents no better off,' she said.
