Why the delay, and is it good news or bad?
Well, the government delay is easy to explain. The official story is that the childcare voucher providers, all huffy about the shoddy way the government treated them in the consultation stage leading up to Tax Free Childcare, decided to get all legal. It was the court case brought by Edenred that caused the delay, 'innit?
Unofficially it's a typical Whitehall shambles, and 2017 is a much better timeframe to get the show on the road. And is the delay good?
I think it's great news, for these three reasons:
- Finally we have certainty. No more challenges, tax free childcare will arrive in 2017 and vouchers will end. We like certainty
- It's good news for the voucher companies. They have a good long window to plan for the changes and convince as many people as possible to join schemes before they close for good. One of the problems of childcare vouchers is the relatively low take up rates. There should be twice as many people taking advantage of them as actually do. A renewed push and a bit of PR - well, that all helps
- And finally it's good news for employers. Family-friendly / flexible working / gender diversity - these are big topics and will continue to be HR priorities.
When vouchers have gone, employers will no longer be able to hide behind their childcare voucher scheme and claim they are family-friendly. 2017 gives them enough time to work out a proper strategy and put it in place (talking to us at My Family Care is the obvious answer!).
Is the end of vouchers a good thing?
YES. Childcare vouchers have worked and are appreciated. But it's a pretty convoluted way of getting money into the hands of working parents.
If the aim of childcare policy is to support working parents, then giving money directly to them is a blatantly better approach. And don't believe all those mischievous messages about people being worse off with the new scheme. It's simply not true. More people will benefit, more of them will be better off, and they will have more freedom on how to spend it.
However, perhaps the biggest winner of the brave new world will be the childcare market itself. It's a market that is fundamentally flawed. We work increasingly flexibly, and have complex lives where the boundaries between work and family are often blurred. The reason our childcare market is such a mess is because we've never been able to agree whether the aim is to develop good quality childcare for everyone, or support parents when transitioning back into the workforce. Linking funding only to regulated care, when people actually need and use a mixture of the formal and informal (I'm talking family, nannies and au pairs) - is crackers. How can a nanny be a childminder, but a childminder not be a nanny?
Working parents should get some money and should be completely free to spend it with whom, and how, they want. That's the only way we'll end up with an affordable and flexible childcare market that reflects the needs of the working population. We've just moved one step closer to that nirvana.
You can find out more about existing childcare vouchers, the new tax free scheme, and the differences between them and the implications for employers, in our Childcare Voucher HR Resource Pack.
Ben Black, My Family Care