Announced in the Commons this afternoon, Chancellor Gordon Brown has unveiled a package of reforms to help get parents of young children back in the workplace.
The Government’s commitment to ‘building a fairer and more inclusive society’ in which everyone can contribute from lone parents to those on incapacity benefits is supported by a number of reforms to the tax and benefit system to tackle child poverty and boost family incomes.
Confirmed are further extensions to paid maternity leave from six to nine months by 2007 with the option to make it transferable between both parents. £285 million has been set aside to support this.
Rights already in place to request flexible working will be extended to parents of older children following consultation.
To support dual-income parents, the Government has promised to extend free nursery education to 15 hours a week and improve post school after care arrangements by setting aside resources to keep schools open between 8am and 6pm.
Brown vowed to consult on extending the Child Trust Fund so that by the age of seven a further £250 will be added for every child and another £500 for the poorest.
Employers will also be able to offer employees, right up the income range, £50 a week extra for childcare free of tax or national insurance.
The Chancellor has also announced the creation of one million new childcare places by 2010.
Shadow Chancellor Oliver Letwin poured scorn on the proposals saying: “Plans for childcare won’t make up for the lack of discipline in schools.”
The Chancellor’s attempts to court the family vote were also attacked by CBI Director-General Digby Jones, who said, “there will be worries about the moves on family-friendly working. The constructive relationship between government and business on this issue could come under serious strain if ministers move too far too quickly.”
Jones continued, “Having both parents share parental leave sounds fine in principle but who is going to police the system? Employers should not be responsible for finding out how much time each parent is entitled to. It is not fair for business to be blamed for intruding into people’s private lives.”
The CBI is concerned that while Government covers most of the cost of paternity and maternity pay, the burden of costs associated with administration, training and replacement are borne by business.
In its reaction to the Pre-Budget Report, Ernst & Young expressed similar anxieties, head of tax Aidan O’Caroll saying, “I would like to see just how well funded all these employment and family programmes are. You cannot fault the principle, but the Chancellor needs to make sure employees are helped to bear these responsibilities. They are not in the business to be an arm of government. If he wants us to be a productive and creative economy, he does need British business people to get on with some work occasionally.”
