The agreement states that, overall, the most pressing task for the Government is debt reduction and this morning, George Osborne revealed that spending cuts of £6.2 billion will be made.
Amongst the cuts is the removal of Child Trust Funds in January 2011. The coalition agreement hinted towards a reduction in spending in this area, but in fact CTFs will cease to exist in the new year, saving around £320 million per annum.
The coalition agreement also said that spending would be cut on tax credits for higher earners, although they will look to improve the administration of tax credits to reduce fraud and overpayments. However, no announcement was made about that this morning.
The agreement also confirms a focus on making society more family friendly. Initially a Conservative party idea, the Government will encourage shared parenting, including the promotion of a system of flexible parental leave. The agreement also pledges support for a diverse range of providers who will implement the provision of free nursery care for pre-school children.
There is no mention of how or if Childcare Vouchers will be affected, and I personally believe we’re currently in a strong position under the coalition government. Certainly Childcare Vouchers are still the most viable way for everyone to save on childcare, particularly with the removal of Child Trust Funds and a reduction in spending on tax credits.