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HMRC delays full rollout of tax-free childcare

By Deri Jones

 
HMRC has confirmed that the government鈥檚 tax-free childcare offer will not be extended to all under 12s until March 2018 鈥 not December 2017 as originally planned. Tax-free childcare for children under six will be offered from 24 November. 
 
Technical problems
The delay comes after a number of technical problems with HMRC鈥檚 Childcare Service website after its launch in March 2017. In August, some parents were offered compensation after being locked out of their tax-free childcare accounts and unable to pay for childcare.
 
In a statement, the government said: 鈥淗MRC recognises that over the summer some parents didn鈥檛 receive the intended level of service whilst using the site.鈥 It added that the more gradual rollout would allow them to 鈥渕anage the volume of applications going through the service鈥.
 
Alliance comment
Neil Leitch, chief executive of the Alliance, said: 鈥淕iven the concerns over the performance of the Childcare Service website over recent month, it鈥檚 no surprise that the government has decided to delay the full rollout of tax-free childcare to ensure the system can cope with an increased volume of applications. That said, with many families still struggling with the cost of childcare, parents who had hoped to benefit from the scheme will be understandably disappointed by this delay.鈥
 
He added: 鈥淲ith the Childcare Service system now set to service a significantly higher number of parents, it is vital that the government invests what鈥檚 needed to deliver and maintain an IT system that both parents and childcare providers are able to use and rely on.鈥
 
Funding concerns
Neil also highlighted the ongoing concerns about the government鈥檚 funding of the early years sector. He said: 鈥淚f the government really wants to address the rising cost of childcare for younger children, the most effective action it could take is to fund the early years sector adequately. Evidence has shown that supply-side funding is key to lowering childcare costs for parents, and it is this that the government needs to focus on if it is ever going to be able to deliver on its promise to parents.鈥
 
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