Finally, more help for working mums

As any working mum will tell you, childcare costs are crippling. For me the cost of leaving my two pre-school boys with their childminder for three days a week racks up to over £1,000 a month.

It's pretty much a second mortgage and we dream of what we'll be able to do with all that spare cash when the youngest starts school in a couple of years' time. We might actually be able to start saving again.

Both my husband and I buy childcare vouchers through our employers and that goes a long way in helping with the cost. In fact, I'd go as far as saying without them it wouldn't be worth my while working.

So, as you can imagine, it was with a sense of trepidation that I awaited the government's long expected announcement on how it proposed to review tax relief for childcare costs – particularly given the coalition doesn't have a great track record for supporting families, following its highly controversial decision to withdraw Child Benefit from so many parents.

What George Osborne has proposed is essentially tax-free childcare. Based on an assumption that the typical daycare cost is £6,000 per child, it will offer a discount of 20% up to that amount – saving parents £1,200. Crucially, this saving will be per child – meaning the more children you have, the greater the savings you stand to make.

Overall, I think it's a great initiative. The current scheme excludes the self-employed, providing a massive disincentive to parents who want to set up their own businesses. It is also only available to parents whose employers operate schemes. When the scheme launches in 2015, the number of families who can benefit will rise from around 500,000 to 1.3 million.

Who are the winners and losers?

As with every government proposal, there will be winners and losers.

One major criticism of the scheme has been that is only available to families where both parents work (and single working parents). But I don't quite get this. Should stay-at-home mums really benefit from government subsidised childcare? I know this is something many
parents do but, let's face it, in the majority of cases it's a luxury, not a necessity.

A big disappointment for me is that the scheme will only initially apply to parents of under-fives. Although it has been said that it will be rolled out to all under-12s by 2020, the government is yet to provide further detail.

Although costs for school-age children are by their very nature lower, the costs of care before and after school can rack up. Indeed, in its latest cost of childcare survey, the Daycare Trust pointed out that it's the cost of this type of care that is rising fastest at 9% a year, setting back parents with two children a whopping £4,000 a year.This is before you even consider the cost of school holiday cover.

Smaller families and those higher-rate taxpayers who joined a childcare voucher scheme before April 2011 (thereby maintaining tax relief at the higher rate) may also save less under the new scheme.

The good news, however, is that those who currently buy childcare vouchers can opt to remain in the scheme if they believe it offers greater savings.

Working out what makes sense for you will ultimately depend on your rate of tax and the size and age of your family, but you can rest assured that as more details of the new scheme become available, Moneywise will be on hand to help you make the right choices.

Rachel Lacey is special projects editor at Moneywise