Labour would increase bank levy to fund free childcare


Ed Balls: "We will increase for working families free childcare for three and four-year-olds"

Working parents of three and four-year-olds in England would get 25 hours of free childcare a week if Labour wins the next general election.

Shadow chancellor Ed Balls plans to raise the banking levy by £800m a year to fund the move.

Three and four-year-olds currently receive 15 hours of free care a week, but Mr Balls wants to increase this.

Meanwhile, he has asked the government's spending watchdog to review his party's economic plans.

Money would be provided for Wales, Scotland and Northern Ireland, but it would be up to the governments there to decide whether to spend it in the same way as England.

Extra 10 hours

The extra 10 hours of free childcare proposed by Mr Balls would be made available to households where all parents are in work - whether single parents or couples.

At the Labour Party conference the shadow chancellor claimed families had lost £1,500 a year in childcare support under the current government.

In other Labour conference developments:

Ahead of his speech to the party faithful Mr Balls told the BBC the policy would be "a huge change and really welcome for families getting out to work".


Call them what you like. The squeezed middle. The strivers. The politicians have a tricky task. They haven't made them better off. But they desperately want their votes.

These are the people who will decide the next election. And if the parties can't appeal to these increasingly sceptical section of the electorate direct - then they will try to appeal to them through their children.

So, last week, the Lib Dems tried to prove there is such a thing as a free lunch - school meals for infant school kids irrespective of their parents' income. Every little helps.

The Conservatives, too, tried to force down the cost of childcare by changing the adult/child ratio in nurseries - that is until their coalition partners stopped it.

Now Labour has entered the fray by pledging to increase free child care for working parents of three and four-year-olds. Note - working parents.

All the parties have to convince the "strivers" that they are not soft on welfare and that they will spend wisely. Hard pressed parents will also want reassurance that policy pledges aren't just for the conference season but are for real.

Hence Labour's offer to have all its tax and spending plans independently audited.

It's a measure of how far trust in politics has fallen amongst floating voters that it's been felt necessary to suggest this. So the next election won't simply be fought on the doorsteps - or in TV studios - but in the nurseries and school rooms too.

"That's a clear and costed commitment showing that even in tough times, when there's going to be less money around, we will make a difference," he added.

He said that "for the first time" parents would be able to work part-time "without having to worry about the cost of childcare".

"Childcare is a vital part of our economic infrastructure that, alongside family support and flexible working, should give parents the choice to stay at home with their children when they are very small and to balance work and family as they grow older.

"But for many families, high childcare costs mean that it doesn't even add up to go to work. So to make work pay for families, we must act."

Bank levy

In his speech in Brighton Mr Balls also claimed the government's banking levy had raised £1.6bn less than expected.

He said: "At a time when resources are tight and families are under pressure, that cannot be right. So I can announce today the next Labour government will increase the bank levy rate to raise an extra £800m a year."

In June 2010, Chancellor George Osborne announced that banks operating in the UK would be subject to a levy - an annual tax on their balance sheets - in a joint move between the UK, France and Germany.

The idea was to raise more than £8bn for the Treasury over four years, and Mr Osborne it was "fair and right" that banks should contribute to the economic recovery given that the financial crisis began in banking.

Labour's policy pledge comes shortly after the government announced that all pupils at infant schools in England will get free school lunches from next September.

Economic 'stunt'

Labour has already promised all parents of primary school children will be able to get "wraparound" childcare - meaning children can be left at school from 8am to 6pm - if it wins the 2015 election.

On Saturday, Ed Miliband said he would "legislate for a primary school guarantee that every school is an 8am to 6pm school", although party officials said schools could band together to offer the opening hours between them.

They said the scheme would be paid for from existing schools budgets, which Labour said had already been raised for the purpose by the last government.

Speaking on BBC Radio 4's Today programme, Mr Balls reiterated his pledge not to increase borrowing to fund day-to-day government spending.

But asked about so-called capital spending - on building and infrastructure projects - he said: "We won't make that decision until we see where we are on the economy in a year and a half's time."

In a separate move, Mr Balls said on Sunday that he had written to the Office for Budget Responsibility to ask it to review his pledges for the economy - although it would have to have its remit changed to be able to do so.

Andrew Tyrie, Conservative chairman of the Treasury Select Committee, said such a review could "improve the quality of public debate" but Treasury minister Sajid Javid called Labour's request a "stunt".


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  • rate this

    Comment number 1441.

    1406. SeeDubya
    And where do you think this money that they "earn" comes from? Do you think, for example, that the millionaire founders of made those millions by altruism?

    It comes from hard working, skilled and intelligent people,self employed people who run firms selling products and services so deal with it. The world isn't against you.Its not a big conspiracy.Stop being a victim.

  • rate this

    Comment number 1440.

    How about a coherent vision for what you'd like the country to be like were you returned to power, Labour, instead of a dribble of unconsidered tidbits you think might win a few votes?

  • rate this

    Comment number 1439.

    Too late, Ed. You obviously miss the point here - educate people to have kids if only they could afford to provide them a quality life. For you the politicians, if you did not start by ripping people off with higher taxes and higher energy bills etc, maybe we, the taxpayers, won't be so pissed!

  • rate this

    Comment number 1438.

    An unemployment rate of 7.7% does not imply 92.3% are working.
    Could do better, try again.

  • rate this

    Comment number 1437.

    Watching the riveting conference - now on is The general secretary of the Union of Selfish, Easy, Layabouts, bEnefit, workShy Skivers (USELESS)

  • rate this

    Comment number 1436.

    @1410. uʍop ǝpısdn - so you are advocating that parent's don't claim what the government says they are entitled to ? Editor's pick ? That has to be the dumbest suggestion on this forum and everyone here is even dumber for having been forced to read it!

  • rate this

    Comment number 1435.

    The reality is, under Tories UK net debt will have doubled from £700 billion in 2010 to £1.4 trillion in 2015! This debt will eventually lead to high interest rates which will cripple the UK economy.

    The Tories have been talking about austerity, but have managed to borrow twice as much in just 5 years, with absolutely nothing to show for it. They stand accused of gross mismanagement.

  • rate this

    Comment number 1434.

    Not long ago 1 person's wage was enough to raise a family but we didn't lead such extravagant lifestyles as people today. Few foreign holidays and one car per family etc. Now both parents have to work to look after the home. So less jobs and the pay is diluted
    So what we really need are better paid jobs so one parent can stay at home and look after the children properly. Bet both would still work

  • rate this

    Comment number 1433.

    1410.uʍop ǝpısdn
    Dont fall for the rhetoric, most parents today do exactly the same thing. But, bear in mind when your parents raised you housing costs were not 8 x times the average salary with a deposit out of the reach of most people on average salaries, University education was free and students got a grant (not loan) to live on.

  • rate this

    Comment number 1432.

    With Cleggs 'Free school meals' and Balls 'Free childcare' - it seems those who are childless through whatever reason are having to pay for those who have children. If people choose to have children then they should fund them.

  • rate this

    Comment number 1431.

    Arrgh! Labour this, tory that THEY ARE ALL THE SAME! At times some of you make out that New Labour were some kind of Trotskyist, Socialist USSR sponsored red machine. They were in the pockets of the banks and the Murdoch empire too. How would the tories have been tougher on the banks whilst New Labour were in charge then? You know seeing how the banks actually fund the tories?! Good grief.

  • rate this

    Comment number 1430.

    Parents need choice, not a business subsidy.

    Many poor own cars, mobile phones, computers, electronics, white goods, clothes, haircuts etc... Why not allow the same competition thriving in these areas to prosper in child-care too?

    Parents need choice, competition, in child-care and we should demand government hurdles to that be removed pronto, rather than redistributing wealth to a cartel.

  • rate this

    Comment number 1429.

    My mother stopped working when my brother and I were born only returning to work when we both started school. I can understand familys with one low earner having both parents working but the tax payer giving wealthy middle class couples money for child care so they can get even more wealthy at the tax payer expence is a step to far.

  • rate this

    Comment number 1428.

    I cant support Labour never will but I can support this idea as I own a preschool and nursery and the times we have to deal with sobbing parents that just cant pay the bill is quite unnerving and in most circumstances both parents work and pay tax. Being a charity in most cases we do everything we can to help but it is hard providing this type of service, and extra hours would help

  • rate this

    Comment number 1427.

    Re: 1401. continentview
    "Who belives Ed Balls? Who is he???? Oh he is the guy who had alot of ministerial jobs and away from bla bla bla bla he messed everyone of them up...."
    WoW, what a surprise!
    But it's nothing new, they all appear to do the same - and most get away with it by hiding the facts from the public. That is about the only thing they do actually excel at.

  • rate this

    Comment number 1426.

    Why are we wasting time here?

    This is Ned Balls. Him and his imbecile mentor, Gordon Brown, destroyed the UK economy last time somebody left them unsupervised.

    Why is he even an MP? How did he get re-elected? Why has this dolt still got a job? What madness is at large in the land that this clown could still be in with a shot of finishing what he started?

  • rate this

    Comment number 1425.

    Fed up of the the socialists attempting to make us pay for other peoples choices. I can't afford to have kids at the moment, so guess what, I'm not having kids at the moment as I don't expect my neighbours to bank roll my own pleasure especially as they don't have them either!

  • rate this

    Comment number 1424.

    I assume that this free childcare is being provided by Labour party members and supporters, to morally repay back some of the deficit which they left us with.

    Blair, Brown and David Miliband have plenty of free time on their hands to help out by offering FREE childcare - good for them !!

  • rate this

    Comment number 1423.

    Classic Government... we have no money and are in economic crisis... lets spend more money on the wrong areas which don't benefit our economy.
    People need to stop talking about whether it's 'right or wrong' and focus on the facts. We are in economic crisis and yet so much money is wasted.
    People need to be more responsible, that's the bottom line.

  • rate this

    Comment number 1422.

    Why don't they put pressure on employers to pay a decent living wage ?!

    This T&C dive is causing this kind of thing, people could pay their own childcare and wouldn't need tax breaks if they got a decent wage.

    Meanwhile top execs and share owners are kept in champagne, while public money is being diverted.

    Employer pays terrible wage - public money fills the gap. Top execs laughing.


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