x

Sign up to our newsletter to get advice and tips on managing your finances.

m We will only use this infomation for the mailing list you have signed up for and will never pass your infomation to any other companies.

Menu Close
0800 901 2488

Call now for free (including mobile)

Debt Calculator - Get the best debt solution

1
v
2
v
3

What is the value of the debt you owe?

Next

How many companies do you owe to?

BackNext

To get free personalised debt advice please fill in the form below

Do you prefer a specific time for a call back?

Back
GDPR has been accepted.By using this form you agree with the storage and handling of your data by this website. Privacy Policy

We can call at a time that suits you

GDPR has been accepted.By using this form you agree with the storage and handling of your data by this website. Privacy Policy
childcare pension rights header

Cutting hours due to childcare sees some mothers losing out on their pension rights

A report from the British Chambers of Commerce (BCC) has found that many employees are cutting their working hours as a result of the high costs of childcare. More than 1600 business leaders were surveyed to uncover these findings and it was also discovered that 10% of staff had quit, again as a result of childcare costs.

Childcare costs in the UK are currently some of the highest in the Western world and as a result, many parents are struggling to pay the costs regardless of how much they earn. This usually results in one person quitting work to look after the children full time as it can be a more viable option financially.

The BCC said that government policy “should evolve to help as many parents as possible stay in the workplace.” However the government defended itself and its current measures where every three and four year old in Britain is entitled to up to 15 hours of free early education and childcare a week.

Next year, this will rise to 30 hours a week further helping parents to manage work and children. It is something those surveyed would welcome but it still puts pressure on many parents to fund remaining hours or go part time when there may not be the availability to do so.

Many business leaders and bosses try to be accommodating to their staff but the availability of childcare for staff has always been a main issue in the recruitment and retaining of staff. The lack of childcare and monetary support for many has seen a drop in employee productivity while more and more staff are having to change roles to one that better suits their family needs.

Adam Marshall, director general of the BCC, feels that the childcare system should be considered in the same way as energy and transport when it comes to improving Britain’s business infrastructure. The government however reiterated their commitment to improving help for parents by “helping to remove the barriers that can stop them from working.”

childcare pension rights content

However, it is not just the financial cost of childcare that is affecting parents. As one parent, usually the mother, is having to give up working in order to look after their children in a bid to save money, a new study has found that mothers are missing out on some of their state pension rights.

The study by Royal London Insurance found that as many as 38,000 women from high-earning families could be affected later in life. In the last two years, it is thought that £278m in eventual pension rights has been lost.

Working and stay at home mothers can claim child benefit, dependent on earnings, which allows national insurance (NI) credits to be collected and put towards their pension. However since January 2013, any parent who earns more than £60,000 a year will have to pay back all their child benefit so many mothers have decided to stop claiming child benefit altogether. As a result, NI credits which go towards pension pots are being lost.

Policy director at Royal London and former pensions minister in the coalition government, Steve Webb, commented on the findings; “It is vital that HM Revenue and Customs (HMRC) takes action to ensure that these women get the national insurance credits which should be theirs by right… Otherwise the cause of gender equality in state pensions will have been set back a generation,”

To claim the new state pension in full, women will need to have collected 35 years’ worth of NI contributions. A woman can claim this through work or alongside her child benefit claim, if a woman has never claimed child benefit they will not receive the contributions. If a woman has previously claimed it and then stopped, they are currently protected by transitional arrangements but this may be something that changes over the next couple of years.

For any women that are worried about their national insurance record and how that may affect their pension in later life, they should contact HMRC. They will be able to inform you of how many years’ worth of credits and how many contributions have been built up to date.

As childcare costs are stopping many women from working and benefits rules stop many women from claiming child benefit, saving for retirement and later life is becoming more and more difficult for many women.

If you are struggling with childcare costs and managing your budget as a stay at home or working mum, make sure you contact us and we can provide you with the advice you need to help you.

If you found this article informative and helpful... Please Share!

Leave a comment

Debt Calculator - Get the best debt solution

1
v
2
v
3

What is the value of the debt you owe?

Next

How many companies do you owe to?

BackNext

To get free personalised debt advice please fill in the form below

Do you prefer a specific time for a call back?

Back
GDPR has been accepted.By using this form you agree with the storage and handling of your data by this website. Privacy Policy

Call today to find out how we can help with your debts0800 901 2488

or

Request a call back
GDPR has been accepted.By using this form you agree with the storage and handling of your data by this website. Privacy Policy