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| Version 1 | Version 2 |
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| PM warned over childcare vouchers | PM warned over childcare vouchers |
| (about 2 hours later) | |
| Plans to phase out childcare vouchers for most parents could harm Labour at the election, nine ex-ministers have warned in a letter to Gordon Brown. | Plans to phase out childcare vouchers for most parents could harm Labour at the election, nine ex-ministers have warned in a letter to Gordon Brown. |
| More than 300,000 families use them to save up to £2,400 a year through tax relief on the cost of childcare. | |
| Mr Brown says this relief is badly targeted and wants to divert money to fund nursery places for two-year-olds. | Mr Brown says this relief is badly targeted and wants to divert money to fund nursery places for two-year-olds. |
| But more than 75,000 people have signed a petition on the Downing Street website calling for a rethink. | But more than 75,000 people have signed a petition on the Downing Street website calling for a rethink. |
| Mr Brown posted a response to the petition saying about one third of the benefit from the tax relief on childcare vouchers went to higher rate taxpayers. | Mr Brown posted a response to the petition saying about one third of the benefit from the tax relief on childcare vouchers went to higher rate taxpayers. |
| "No-one who is currently using the scheme will be affected in the next five years," he said, adding that working parents on lower incomes would get more support through tax credits. | "No-one who is currently using the scheme will be affected in the next five years," he said, adding that working parents on lower incomes would get more support through tax credits. |
| Parental choice | Parental choice |
| About 340,000 parents take part in the vouchers scheme, which was introduced in 2005 and can be used for nurseries, nannies or child-minders. | |
| Withdrawing [the vouchers] will penalise a significant number of lower rate taxpayers Letter from MPs to Gordon Brown | Withdrawing [the vouchers] will penalise a significant number of lower rate taxpayers Letter from MPs to Gordon Brown |
| It involves parents sacrificing up to £243 of their salary - before tax and national insurance are taken off - in exchange for electronic "vouchers" which are then paid to Ofsted-registered child carers, from au pairs to nurseries. | It involves parents sacrificing up to £243 of their salary - before tax and national insurance are taken off - in exchange for electronic "vouchers" which are then paid to Ofsted-registered child carers, from au pairs to nurseries. |
| The Treasury wants to phase out this tax break, which is equivalent to a 31% saving on the first £243 spent on childcare costs each month for basic rate taxpayers, or 51% for those paying the higher rate. | The Treasury wants to phase out this tax break, which is equivalent to a 31% saving on the first £243 spent on childcare costs each month for basic rate taxpayers, or 51% for those paying the higher rate. |
| However, former health secretary Patricia Hewitt, ex-education secretary Lady Morris and former chief whip Hilary Armstrong are among 43 MPs to sign the protest letter. | However, former health secretary Patricia Hewitt, ex-education secretary Lady Morris and former chief whip Hilary Armstrong are among 43 MPs to sign the protest letter. |
| According the Guardian, it says: "Withdrawing [the vouchers] will penalise a significant number of lower rate taxpayers, reduce the overall amount of funding available for childcare, reduce parental choice and impact negatively on the economy as the UK moves towards recovery. | According the Guardian, it says: "Withdrawing [the vouchers] will penalise a significant number of lower rate taxpayers, reduce the overall amount of funding available for childcare, reduce parental choice and impact negatively on the economy as the UK moves towards recovery. |
| "Crucially, in the run-up to an election, it will remove support for working parents and for businesses in key marginal constituencies." | "Crucially, in the run-up to an election, it will remove support for working parents and for businesses in key marginal constituencies." |
| One of the signatories, former international development minister Sally Keeble, told the BBC it seemed "quite wrong" to take support from one group of parents to help another. | One of the signatories, former international development minister Sally Keeble, told the BBC it seemed "quite wrong" to take support from one group of parents to help another. |
| Childcare vouchers are handled by private firms, which charge a small percentage administration fee. However, estimates suggest just one in five employers offers the scheme. | Childcare vouchers are handled by private firms, which charge a small percentage administration fee. However, estimates suggest just one in five employers offers the scheme. |