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EDITIONS
Tuesday, 17 March, 1998, 19:53 GMT
Spotlight on child care costs
Families were the bedrock of a stable and healthy society, Chancellor Gordon Brown said, as he announced measures to help couples pay for child care.

The new Working Families Tax Credit would include a child care tax credit, Mr Brown said.

This would mean up to 70% of child care costs for the first 100 a week for a family's first child, and up to 150 for two or more children.

The announcement was welcomed by Conservative leader William Hague, but he added: "It looks at first analysis that two neighbours will be better off looking after each other's children than looking after their own. That is a policy with which we will not agree."

Other key points affecting children:

  • Child Benefit to increase by 2.50 on top of inflationary increase for the first child from next April
  • Child Benefit will remain universal, and paid directly to the mother
  • There was no case for a one-parent benefit, Mr Brown said
  • Tax on Child Benefit for higher earners to be considered
  • Tax allowance which had previously only been available to men with children and an incapacitated wife now to be applied to women with an incapacitated husband.

The increase in child benefit is to be paid for by a reduction in married couples' allowance, from 15% to 10%.

Mr Brown said: "I believe Child Benefit remains the fairest, the most efficient and the most cost-effective way of recognising the extra costs and responsibilities borne by all parents.

"And raising it allows us to do more for mothers who choose to be at home, working at home bringing up their children."

Colette Kelleher, director of national childcare charity, the Day Care Trust, said the new tax credit system would help transform the lives of millions.

"For the first time, the Budget will make work pay for low income parents and give their children the service they need.

"It will put money into parents' pockets and make a realistic contribution towards the cost of child care."

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Gordon Brown's announcement on new provisions for childcare ('1 ''19).
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