News

Tax cuts for childcare
Crackdown on school bullying
New opportunities fund welcomes merger decision
New code for home carers

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22 April 2003 - Tax cuts for childcare

A raft of new measures that will significantly extend access to tax breaks for employer-supported childcare across the UK has been proposed by the Treasury.

At present, employees do not pay tax on the benefit of a place in a nursery provided by an employer, as long as the provision satisfies strict criteria. If the nursery is not on the employer's own premises, the employer must be wholly or partly responsible for both the financing and management of the nursery. This tax break has been relatively limited in its scope.

A more popular form of support is employer-provided childcare vouchers, which can be used for any form of childcare. These are exempt from both employers' and employees' national insurance contributions (NICs), but employees are taxed on them.

A consultation paper issued jointly by the Treasury and the Inland Revenue last week explains that the Government intends to expand the workplace nurseries tax exemption to include all forms of registered childcare, including approved childcare in the home. A new tax exemption will also be introduced for childcare vouchers.

A financial limit will be introduced for the tax and NICs exemption on all formal childcare provision. The consultation proposes that this should be £50 per week per employee, with the excess subject to tax and NICs. This will not apply to nurseries managed and financed by the employer on the employer's own or shared premises, in which case the full benefit will remain exempt, as at present.

The consultation paper explains that the Government intends to set this limit in order to reduce the incentive for employees to engage in salary sacrifice arrangements (also known as salary conversion or fee-direct) for supporting childcare, whereby the employee relinquishes part of his or her salary and receives support for childcare instead. Such arrangements save the employer NICs on the amount of salary that is sacrificed. However, employees' access to state benefits and future pension entitlement may be adversely affected.

The Treasury also intends to make it easier for employers providing workplace nurseries to qualify for the tax break up to the £50 per week limit by removing the requirement for the employer to have management responsibility for the provision. The consultation makes it clear that childcare support schemes should be available so all employees, not just the favoured few, can qualify for the tax exemption.

Launching the document, Employer-supported Childcare, at the workplace nursery run by the Royal London Hospital, paymaster general Dawn Primarolo said, 'The Government is determined to help parents to balance their work and family life. Employers have a very important role to play in helping their staff to achieve a balance and in helping parents meet their childcare needs. We are committed to supporting them in this. Today's proposals will help to ensure that more parents than ever before have access to affordable, good quality childcare.'

Stephen Burke, director of the childcare charity Daycare Trust, welcomed the review of tax incentives. He said, 'It's an opportunity to encourage employers to do more for working parents, particularly those on lower and middle incomes. The current arrangements need to be enhanced so that more employees benefit from help with childcare provided by employers. Beyond that, the review can examine how best to enable employers to fulfil their corporate social responsibility.'

The consultation paper is available on www.hm-treasury.gov.uk and www.inlandrevenue.gov.uk . The Inland Revenue also published guidance on salary sacrifice arrangements last week, available on its website.

James Tweed

05/03/2003

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22 April 2003 - Crackdown on school bullying

Schools are to do more to overcome the "indignity and distress" of bullying, the government has announced.
Education minister Ivan Lewis promised more funding for anti-bullying programmes and better communication between victims and teachers.

Under the £470m Behaviour and Attendance programme, specialist consultants will also help local education authorities.

Mr Lewis's comments came after the education watchdog Ofsted said schools had to develop a sustained approach to defeating bullying.

Mr Lewis said: "Bullying is a blight on us all. It is painful and degrading for the victim, and tarnishes not only the reputation of the school but also the wider community.

"I am determined to do more to spare young people the indignity and distress of bullying.

'Need to listen early'

"We have taken important steps to tackle it, ensuring that all schools draw up anti-bullying policies using detailed information packs, videos and online resources.

"But policy is not enough. The key issue is to listen early and listen always to what young people are telling us about bullying."

The Ofsted research concludes that, while many young people rate their schools as "very good" or "quite good" in their anti-bullying work, more could be done.

Mr Lewis said: "We plan to issue new guidance to schools and local education authorities on holding consultations with pupils.

"The issues will include how bullying should be tackled in their schools and ensuring that 'telling' does not rebound on a victim.

"All young people need to have access to sources of help and advice both within and outside school."

Shadow education secretary Damian Green called on the government to abolish appeals panels, which "too often bring disruptive children back into school".

He added: "Ofsted is right that the effectiveness of a school's anti-bullying policy depends on the continuing commitment of the head and staff.

"We also advocate allowing heads to use legally backed contracts with parents, which could set out the school's policy on bullying and ensure parental involvement in making it stick."


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22 April 2003 - New opportunities fund welcomes merger decision

The New Opportunities Fund welcomed the decision being announced today by Tessa Jowell, Secretary of State for Culture, Media and Sport, to merge the New Opportunities Fund and the Community Fund, describing the initiative as "an opportunity to create a new Lottery good cause distributor which will build on the strengths of both organisations."

Baroness Jill Pitkeathley, Chair of the New Opportunities Fund said: " The Fund recognises that a new body can provide a more streamlined and accessible service to a wide range of customers and stakeholders, and play a key role in the Government’s agenda to make Lottery distribution more effective and customer-focused."

She added: "We regard the merger as an exciting challenge. Increased benefits for communities will be the acid test. There should be a real opportunity to think creatively and develop an effective mix of open and strategic programmes – we believe that partnership, tackling disadvantage, improving community services and local priority setting must be key themes for the new body."

The Fund is already a very substantial funder of the voluntary sector – around 40 per cent of the £1.62 billion which the Fund has committed to projects so far have gone direct to voluntary sector organisations.

The proposed merger was discussed by the New Opportunities Fund’s Board in January (21 January 2003), and the Fund will now take forward detailed discussions with the Community Fund.

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22 April 2003 - New code for home carers

Registered childminders in England who decide to become home carers will have to adhere to a code of practice that has been drawn up by the Department for Education and Skills.

The code of practice will focus on the differences between working in the childcarer's own home as a childminder and in a child's home as a home carer, as well as keeping children safe by minimising risks, preventing children from being exposed to hazards and supervising them properly. The scheme will be supported by a workbook that has been produced by the National Childminding Association (NCMA) to help home carers consider issues such as how to undertake a risk assessment of someone else's home.

However, any registered childminder in England wanting to join the national scheme, which is due to begin at the start of April, will have to seek approval from Ofsted before they can do so. Although they are registered already they will have to be interviewed again by an Ofsted inspector who will decide if they are suitable to join the scheme. They will also have had health checks.

Once registered as approved home carers, childminders can let their childminding registration lapse. But if they keep their registration up to date they will be able to work as both a home carer and a childminder - though not at the same time. They could work as a childminder by day then as a home carer in the evening in the child's home or vice versa.

Ofsted said its rationale for this decision was that 'you cannot do two jobs at the same time and the rules surrounding these roles are different'. It pointed out that while an inspector checks a childminder's home for safety, home carers will have to carry out their own risk assessments of a child's home, and also no-one in the family home in which the home carer is working 'will be expected to home a Criminal Records Bureau check except the home carer as part of the childminder registration, whereas any person over the age of 16 living in the childminder's home must be checked'.

A leaflet about the scheme for parents produced by the NCMA, points out that the main difference between a home carer and a nanny is registration. It says, 'While we recognise that many nannies provide a highly professional service and can be highly qualified, they do not have to be registered and their service is not checked against any standards. Because of this, families using nannies cannot be supported by child credits.'

At present the home carers scheme is open only to registered childminders. But the DfES has stressed that it will be widened to include other people who are not childminders, such as nannies and relatives of the children being cared for. However, the scheme is still evolving and further changes are likely between now and April.

Childminders in England wanting to know more about the scheme should contact their local Children's Information Service (CIS). To find out the number of your local CIS, contact ChildcareLink on 08000 960 296 or visit the website www.childcarelink.org.uk. The Ofsted information helpline is on 0845 601 4771.

26/02/2003

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