Queen’s Speech outlines plans on childcare and a freeze on working-age benefits

A doubling of free childcare for three and four year olds, a freeze on working-age benefits and a tightening of the benefits cap were two of the main planks of the Queen’s Speech given today.

The Conservatives plan legislation to double the number of free hours of childcare parents of three and four year olds are entitled to from 15 to 30 a week. If passed, this would come in by 2017 and would apply to families where both parents are working. The Conservatives say it would help 600,000 children a year. In their manifesto, they said it would be funded through reductions in tax relief on pension contributions.

Neil Leitch, chief executive of the Pre-School Learning Alliance, said:  “While plans to improve the availability of childcare are of course positive in theory, as it stands, they unfortunately remain unlikely to succeed in practice as, to date, the government has done very little to address concerns that the free childcare scheme is severely underfunded.

“Independent research into the current offer commissioned by the Alliance last year showed that childcare providers are already facing funding shortfalls of around 20%. As a result, many are being forced to increase the cost of paid-for hours, resulting in higher childcare costs for parents. Extending the free childcare offer without first addressing these funding gaps will only exacerbate this problem further.”

The Queen’s Speech also outlined plans to freeze working-age benefits, tax credits and child benefit for two years from 2016/17, to reduce the total amount one household can claim in benefits from £26,000 to £23,000 and to ban increases in income tax, VAT and national insurance for five years. The government also says that it will ensure that “no-one working 30 hours on the minimum wage pays any income tax at all” and that it will raise the threshold before which people pay income tax to £12,500.

Prime Minister David Cameron said the legislation was an agenda for “working people” and promised three million more apprenticeships and a new law to ensure the minimum wage remains tax free.

However, Labour said the government planned to attack basic employment rights through its plans to bring forward a British Bill of Rights to replace the Human Rights Act, although Conservative plans to scrap the Act have been delayed. The Act covers issues such as discrimination in the workplace.

Picture credit: Wikipedia.

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