Parents deserve the widest possible choice in child care

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The Independent Online

The Government's decision to extend tax relief on child care to those who employ nannies is a brazen attempt to court the votes of working women. And it is surely not coincidental that this is the very group of voters which, opinion polls tell us, is most disillusioned with Tony Blair. That ministers have decided to give some women what they want in good time for the next election, however, is no reason to denounce the Government's change of heart.

The Government's decision to extend tax relief on child care to those who employ nannies is a brazen attempt to court the votes of working women. And it is surely not coincidental that this is the very group of voters which, opinion polls tell us, is most disillusioned with Tony Blair. That ministers have decided to give some women what they want in good time for the next election, however, is no reason to denounce the Government's change of heart.

In one respect, the concession reflects a government failure. It has long held out the prospect of nursery places for all children whose parents want them, but there are still far fewer places than needed, and the price goes up all the time. The cost of places for two or more children has fast approached that of employing a nanny, so it was increasingly unjust to give tax breaks only to those parents having their children cared for outside the home.

The tax break will be restricted to families earning less than £58,000. This targets it clearly at middle-income households, excluding those who can easily afford a nanny anyway (and who were perhaps less likely to vote New Labour). Under the new provisions, the cost of in-house child-minders and after-school and holiday clubs will also be tax-deductible. For some parents, the tax relief could cut childcare costs by as much as two thirds.

The Government's stated reason for extending the tax break is to encourage more women to go back to work after having children. It is true that the cost of child care, paid out of taxable income, has discouraged a growing number of women from working, especially in the south-east. Some may be tempted back into the workforce. Others, however, especially those whose earning capacity is limited, may find that the sums still do not add up.

The Government still needs to work considerably harder to fulfil its pledges to make affordable childcare available to all. In the meantime, any measure that gives more parents a wider range of options is a move in the right direction.

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