There has been speculation that the Chancellor will announce extra childcare measures in the Autumn Statement to help JAM families who are ‘just about managing’.
Chancellor Philip Hammond will deliver his Autumn Statement on Wednesday with the Government under pressure to help families who are ‘working around the clock’ to make ends meet.
It is thought that he may announce extra childcare subsidies to help working parents of one and two-year-olds and could also help struggling families by raising the personal allowance on income tax.
Callum Biggins, senior policy adviser of tax and fiscal policy at the Confederation of Business Industry (CBI) believes that “closing the gap between free provision of childcare and statutory maternity pay should be key goals for Government” as affordability and availability of childcare is often cited as a barrier to getting more parents back into work.
He suggests offering 15 hours of free childcare aged one and two and extending statutory maternity pay from 39 to 52 weeks, which would make it easier for parents to stay in work for longer.
However Purnima Tanuku, chief executive of National Day Nurseries Association warned that any “measures to ease the financial burden of childcare costs on families must not destabilise the nursery sector”.
She said: “Our members are giving a strong message that the funding they are expecting to receive for delivering 30 hours of ‘free’ childcare from September will not be sufficient for nurseries to remain sustainable.
“If they can’t sustain their businesses, they won’t be able to deliver the increased demand in places that this offer is expected to create.
“At this time, the priority has to be making sure that current expansion plans are viable before looking at other ways of extending the offer.”
Neil Leitch, chief executive of the Pre-School Learning Alliance, called the Autumn Statement the “perfect opportunity for the Government to respond to the sector’s underfunding concerns”.
He added: “The Government has previously announced a number of parent-focused childcare subsidies, such as tax-free childcare - but as we have said time and time again, such approaches are short-term measures which don’t tackle the underlying causes of childcare costs rises: chronic underfunding.
“If the Government really wants to help parents struggling with the cost of childcare, it needs to fund providers properly. Anything else is like putting a plaster on a broken leg: woefully insufficient.”