Badenoch wants to remove England’s £100,000 childcare cutoff

A promotion is supposed to be good news. For some parents in England, crossing an income threshold can mean losing childcare support worth more than the extra pay. That awkward calculation became a central talking point as the Conservative Party opened its conference on October 4.

Leader Kemi Badenoch pledged to remove the £100,000 cutoff for funded childcare and Tax-Free Childcare under a future Conservative government. Her argument is that parents should not feel pushed to refuse better-paid work because of the support they would lose.

This is an opposition policy promise. It does not change the rules families currently use to apply.

What the cutoff means

The government's eligibility guidance says a family cannot receive the working-parent entitlement if either parent's expected adjusted net income exceeds £100,000 for the tax year. The test applies to each parent, rather than simply adding the couple's income together.

Adjusted net income is the measure used in the rules, so describing the threshold as a basic salary cap is an oversimplification. Other conditions also apply, including work, a child's age and residence status.

Eligible parents of children aged nine months to four years can receive 30 funded hours a week for 38 weeks of the year. There are other forms of support, including the separate 15-hour entitlement for three- and four-year-olds in England.

That matters because losing the working-parent entitlement does not necessarily mean losing every kind of help. The details depend on the family's circumstances.

The case for changing it

The Conservatives say the abrupt loss discourages some people from accepting promotions or increasing their hours. The party also argues that the rule creates uneven outcomes between households depending on how earnings are divided between parents.

Bloomberg's October 4 reporting places the promise within Badenoch's wider pitch on work and tax reform. The party says the childcare change would be funded through public-spending savings.

Removing a sudden cutoff could make the next pay rise easier to assess. It would also extend support to higher earners, raising a different question: whether that is the best use of the available public money.

The debate is about priorities too

Labour criticised the proposal as a benefit for higher earners under rules the Conservatives originally introduced.

For younger adults planning a family, the wider issue is familiar: how to combine a career, childcare and a workable household budget. The promise offers one answer to one part of that problem. Its funding, practical design and political support would still need to survive scrutiny before any family could rely on it.