Increasing childcare in disadvantaged communities

£4.5 million for after school and holiday clubs

Councils can now apply for their share of £4.5 million to support the provision of after school and holiday clubs for Scotland’s most disadvantaged areas.

The funding will help improve both indoor and outdoor spaces in the school estate, with schools also encouraged to consider wider community needs.

First Minister Humza Yousaf set out details of the funding as he convened a national anti-poverty summit in Edinburgh yesterday.

The First Minister said: “Tackling poverty must be a shared priority for us all and this summit offers the opportunity to listen to a wide range of views to help us take the right action to drive down inequality across Scotland.

“Helping families deal with cost of living pressures is one of our key priorities and providing further funding for affordable and accessible school age childcare will help deliver that.

“Funded school age childcare supports parents and carers into work and enables them to support their families, while also providing a nurturing environment for children to take part in a wide range of activities.

“Scotland already has the most generous childcare offer anywhere in the UK. All three and four-year-olds and eligible two-year-olds are entitled to 1,140 hours a year of funded early learning and childcare. We are working with partners to make further progress, with plans to develop a funded early learning and childcare offer for one and two-year-olds by 2026, focusing on those who need it most.”

The Scottish Government will provide a £4.5m recurring Capital Fund, managed and administered by Scottish Futures Trust, to deliver improvements to the school estate that will support the provision of before and after school and holiday clubs within Scotland’s most disadvantaged communities.

The intention is that the fund will be limited to the school estate (both indoor and outdoor spaces) for year one, but schools will be encouraged to consider wider community needs and spaces where children want to be after school or during the holidays, particularly where links or partnerships already exist.

The £4.5m fund will be open to all Local Authorities who will be required to demonstrate how they have worked in partnership with school age childcare and activities providers, to be ambitious in their ideas, and to define projects which will deliver benefit for children and families, particularly those from low-income areas.

Funded school age childcare is targeted at families on the lowest incomes, specifically the six priority family types identified in the Tackling Child Poverty Delivery Plan (lone parent families, minority ethnic families, families with a disabled adult or child, families with a younger mother [under 25], families with a child under one, and larger families.)

Save up to £2,000 with Tax-Free Childcare in Scotland

As schools return in Scotland, HM Revenue and Customs (HMRC) is reminding working parents they could save up to £2,000 per child per year to pay towards after-school clubs and other childcare services.

Around 110,000 families in Scotland are eligible for Tax-Free Childcare, which can cut thousands of pounds off childcare bills.

All families have to do is pay into their Tax-Free Childcare account and for every £8 that they deposit, the UK Government immediately makes a top-up payment of an additional £2.

The scheme is open to working parents, including the self-employed, who earn between the minimum wage and £100,000 per year and have children aged 0-11 years old. Families with a disabled child, aged 0-17 years old, can receive up to £4,000 in government support each year.

Families in Scotland can choose from childcare providers that have signed up to Tax-Free Childcare, including nannies, nurseries, childminders or after-school clubs.

HMRC’s Deputy Chief Executive and Second Permanent Secretary, Angela MacDonald, said: “As more parents across the country return to work and kids head back to school following the outbreak of the Coronavirus pandemic, there has never been a better time to sign up to Tax-Free Childcare.

“It takes just minutes to set up an account on our Childcare Choices website and soon you could be receiving up to £2,000 per child towards the cost of childcare each year.”

UK Government Minister for Scotland, Iain Stewart, said: “Tens of thousands of families in Scotland are eligible to access savings towards after-school clubs and other childcare services thanks to the UK Government’s Tax-Free Childcare scheme.

“As more parents return to work and children to Scotland’s schools following the arrival of the COVID-19 pandemic, I urge people to make full use of the support. The scheme is part of a significant package of measures that the UK Government has in place to help families in Scotland.”

You can find out more and apply through the Childcare Choices website. It includes a Childcare Calculator that compares all the government’s childcare offers to check what works best for individual families.

Tax-Free Childcare is just one example of the support available to families in Scotland from the UK Government. More information on other schemes such as Help To Save and Marriage Allowance can be found on the Delivering for Scotland website.

How Tax-Free Childcare works:

  • Working parents can apply, through the childcare service, to open an online childcare account. The scheme is available for children under the age of 12, or under the age of 17 for children with disabilities.
  • If you or your partner have an ‘adjusted net income’ over £100,000 in the current tax year, you will not be eligible. This includes any bonuses you expect to get.
  • For every £8 that families pay in, the UK Government will make a top-up payment of an additional £2, up to a maximum of £2,000 per child per year (or £4,000 for disabled children). This top-up is added instantly and parents can then send payments directly to their childcare providers. The maximum government top-up is £500 per quarter for each child, or £1,000 if the child is disabled.
  • All registered childcare providers – whether nannies, nurseries, childminders or after-school clubs – can sign up online to receive parents’ payments through Tax-Free Childcare.
  • Parents need to sign back in every three months and confirm their details are up-to-date, to keep getting government top-ups.
  • Families who were already signed up to Tax-Free Childcare but have fallen below the minimum income requirement due to COVID-19 will continue to receive financial support until 31 October. Critical workers who may exceed the income threshold for the 2020-21 tax year due to working more to tackle the pandemic, will continue to receive support this tax year. More information.
  • You can check your eligibility for Tax-Free Childcare in relation to COVID-19.