Lower earnings cap for Tax-Free Childcare to pay for 30 hours for foster carers

Dropping the eligibility cap for Tax-Free Childcare would free up £150m to pay for foster carers to access the 30 hours, the chair of the Education Select Committee has said.

Robert Halfon MP said it was ‘indefensible’ that foster carers were excluded from accessing the 30 hours and proposed cutting the earnings threshold from £100,000 per parent to £65,000.

He also said the 30 hours eligibility criteria should be changed so that unemployed parents could access it.

Mr Halfon said, ‘The exclusion of fostered children is indefensible. Foster carers raise some of society’s most vulnerable children, many of whom would benefit from high-quality childcare, which would help boost social development.

‘We could pay for this by reducing the generous threshold that exists for parents to claim Tax-Free Childcare, a subsidy that does not capture society’s most disadvantaged families.

‘In time we should also reduce the similarly generous earnings cap for the 30 hours of free childcare. And we should channel this to non-working parents whose children need it more.’

Mr Halfon made the comments in a keynote speech to the Joseph Rowntree Foundation at the launch of its report, ‘UK Poverty 2017’, which revealed that nearly 400,000 more children were in poverty last year than in 2012/13.

Purnima Tanuku, chief executive of the NDNA, said, ‘The principle of capping the earnings threshold at a lower level to benefit our more disadvantaged families makes sense. However, before any decisions are made on the earnings threshold for 30 hours and TFC, we need to make sure this is thoroughly costed out to see how this will benefit both families and providers.’