Tories to introduce 'informal' childcare grants for relatives

Grandparents could be paid to look after their grandchildren while the parents are at work under a Tory government, Michael Howard will announce today.

Grandparents could be paid to look after their grandchildren while the parents are at work under a Tory government, Michael Howard will announce today.

The Tories will promise that 250,000 parents with a joint income of less than £58,000 a year would receive a tax credit of £50 a week for each child under five regardless of what type of care they use.

Under the Government's working tax credit, which "tops up" the wages of those in lower-paid jobs, parents get up to 70 per cent of childcare costs refunded up to a maximum of £135 a week for one child and £200 a week for two or more children.

The care must be provided by registered childminders, nurseries, out-of-school clubs or other approved schemes.

A Tory policy document says the party would extend help to informal arrangements in which children are looked after by relatives, friends, nannies or au pairs. It would encourage grandparents to become registered childminders by setting up special courses for them to learn the latest skills.

"Grandparents offer a wealth of knowledge, understanding and experience, yet this hugely qualified childminding resource is being wasted," the document says. While many want to work as childminders, they are put off by unnecessary bureaucracy.

"Provided the grandparent looks after a minimum of two other children who are not members of their family they will be eligible for childminder grants, credits and other benefits," the Tory blueprint says.

The Tories will announce they would increase maternity pay by £1,400. Working mothers would receive 90 per cent of average earnings for the first six weeks, followed by a choice between 33 weeks at £102.80 a week and 20 weeks at £169.62 if they wanted to return to work after six months.

The party, which says it would spend an extra £500m on child care by 2009, also pledged £10,000 start-up grants for workplace nurseries and out of school clubs.

Mr Howard said the Tories wanted to make the system much more flexible and give parents more choice. The Tories claim that, since 1997, there has been a 22 per cent fall in playgroup and pre-school places and a 24 per cent drop in childminder places, leaving Britain with the most expensive childcare in Europe.