Martyn Lewis - Money Saving Expert says of childcare vouchers
Money Saving Expert Martin Lewis tips childcare voucher schemes as one of the top ways to save money on childcare over the school holidays
Amanda Ward, Director, Early Years Vouchers says, the summer holidays are finally here, but as parents gear themselves up for a well-deserved rest from making packed lunches, washing dirty PE kit and braving the school run, another more pressing problem emerges - how to pay for those expensive holiday clubs for your children? As Money Saving Expert, Martin Lewis, pointed out this Tuesday morning (22nd July) on GMTV, working parents don't need to pay huge sums for childcare, or take time off to look after the kids but lose out on valuable income, or hope that there will always be a friend or family member around to take responsibility for the youngsters. There is another option. They can make the most of employer's Childcare Voucher Schemes.
Many parents are missing out on huge savings, simply because many of them aren't aware that the vouchers exist, and others think they aren't eligible for the savings because they are not seen as 'low earners'. Parents also often don't realise that the Childcare Vouchers can be used to pay for a whole range of childcare options, including many summer classes and holiday clubs.
The summer holidays can be particularly pricey for parents: from summer schools and football clubs, to days out at the beach or the zoo.The costs of keeping the kids entertained for six weeks is yet another rising cost that parents are keen to avoid. With energy bills, rail fares, petrol and the cost of childcare all rising sharply, many families are feeling the pinch. National Homebuyers predict that the rising cost of living may tip some people over the edge financially in the coming months, leading to an increase in home repossessions. One of the many costs parents will have to face this year is childcare, which, according to a survey published by the national childcare charity, Daycare, has grown nearly 30 per cent in the last seven years.
The vouchers cover childcare up to the age of fifteen, and can be used to pay for any childcare that is registered and regulated by Ofsted. Many parents don't realise that this covers not just nursery schools, playgroups, nannies and childminders, but also a wide range of summer classes, clubs and workshops for older children. Other flexible aspects of the scheme are that vouchers aren't child-specific, plus they have a long expiry date, so can be saved up for times when parents know childcare costs will be higher, such as the summer holidays. Also many providers allow parents to backdate vouchers by up to six months.
However, many parents aren't claiming the government support they are entitled to through childcare voucher schemes. All working Mums and Dads are in fact eligible for tax- and NI- free childcare vouchers, but the lack of knowledge and promotion by the government surrounding voucher schemes simply fuels the misconception that in order to qualify for childcare savings they have to be low earners. In reality, every single working parent is entitled to childcare savings, regardless of how much they earn, either through working tax credits or childcare vouchers. Working Mums and Dads who are 20 per cent tax payers can save £903.96 per annum on childcare costs, while 40 per cent taxpayers are entitled to savings of almost £1,200.
It's not just parents that need to be told about the benefits they can gain from childcare vouchers, but employers too. In many cases, the employer doesn't flag up the availability of the vouchers to their employees. However, as Martin Lewis was keen to stress, it costs nothing for a company to sign up to Childcare Voucher Scheme; in fact, because employers don't pay National Insurance on the Vouchers, being part of such a scheme can actually make them money, so everyone benefits. Companies can be reluctant to sign up to the scheme because the misconception still exists that implementing a voucher scheme will add to a busy HR workload. But with the fully automated services and personal customer support that we provide, there is no excuse for parents to be missing out on such substantial savings.
Employers, including Kellogg and Endemol, have taken on childcare voucher schemes from Early Years Vouchers to provide their working Mums and Dads with savings that make a big difference to family life. "EYVL's scheme is a 'no-brainer' for us," comments Tom Stevenson, HR Manager, Total Compensation UK & ROI, Kellogg. "The fact that both parents can benefit from EYVL's childcare voucher scheme has definitely been a big positive for our employees and the feedback we've received has been tremendous and has exceeded all our expectations."
Claire Harrison, Payroll Manager at Endemol, said: "Taking up a childcare scheme like the one EYVL offers helps improve staff recruitment and retention levels, but more importantly it has helped us enhance Endemol's social responsibility. Such a scheme is really encouraging for working Mums - and increasingly Dads - to come back to work, especially as it also provides parents with help for childcare costs until the children are 15 years old."
About Early Years Vouchers:
Early Years Vouchers is one of the UK's leading childcare voucher companies. Founded in 2004, the company operates one of the UK's most advanced fully functional online childcare voucher systems for parents, carers and employers of any size - from large nationwide organisations with many thousands of employees to small companies with just two or three. The scheme enables each parent to achieve significant cost savings for the 2006-2007 tax year of up to £903.96 per year for a 20% tax payer and £1,195.56 per year for a 40% tax payer. Additional information is available at www.childcare-vouchers.net or contact 0800 088 7315.