Tories propose £700m childcare expansion for high earners, scrapping £100k salary cap

The Conservative Party announced a £700m annual childcare subsidy on the eve of their conference in Birmingham, proposing to scrap the salary threshold that currently cuts off free childcare eligibility for higher-earning families. Under the existing system, introduced during Rishi Sunak's tenure, families with young children in England receive 30 hours weekly of free childcare—but only if neither parent earns more than £100,000. The new Conservative plan would remove that cap entirely, extending the benefit to all parents working at least 16 hours per week, regardless of income.

Kemi Badenoch, the Conservative leader, framed the change as a matter of economic fairness and work incentive. She called the current system "absurd" and argued it punishes people for earning more or accepting promotions. In her statement, Badenoch drew on her own experience as a mother of three, saying families already face difficult choices about work and childcare without government making those decisions harder. She emphasized that the policy would particularly help women, who often shoulder more childcare responsibility and whose career progression is constrained by the financial cliff created when one parent's salary crosses the £100,000 line. No one should have to turn down a pay rise because they cannot afford the loss of childcare support, she said.

The party proposes funding the £700m cost through cuts to organizations including Arts Council England and the Environment Agency. This announcement arrives as part of a broader policy package unveiled ahead of the conference, following the Conservatives' earlier proposal to abolish stamp duty on primary residences in England and Northern Ireland—a change estimated to cost £9bn annually and one that would disproportionately benefit wealthier households and those in London and the south-east.

Labour's response was swift and pointed. A party spokesperson noted that the Conservatives were now seeking to undo one of their own tax thresholds, suggesting the party was reluctant to acknowledge that they had set the £100,000 limit in the first place. The criticism underscores a broader political tension: both major policy announcements—the childcare expansion and the stamp duty abolition—would primarily benefit higher earners, even as the Conservatives frame them as pro-growth and pro-work measures.

The conference agenda also includes a third major proposal: expanding prison capacity by 50%, adding 50,000 new spaces across England and Wales. This expansion would be partly funded by cutting overseas aid to £1bn annually, representing a 90% reduction from current plans. Labour, by contrast, has committed to reducing aid from 0.5% of GDP to 0.3% by 2027, a lower proportion that would still amount to £9bn yearly. Aid organizations have previously warned that cuts to £1bn would be insufficient to cover existing contributions to global institutions like the UN and World Bank, potentially diminishing Britain's international standing.