Voucher payment 'loophole' could leave nurseries out of pocket

Brian Cooper, who runs Meir Park Day Nursery in Stoke-on-Trent, said that on several occasions he had tried to redeem Busy Bees and Computershare paper vouchers but found they had already been cancelled.

Mr Cooper said the system was open to abuse and left nurseries having to chase debts.

'Nurseries that agree to accept vouchers are giving up other forms of guaranteed payment. We have not lost money, but that is more to do with the good relationship with the parents,' he told Nursery World. 'In the past 18 months vouchers worth almost £1,000 have been rejected by Computershare/Busy Bees.'

Mr Cooper said that in the past week, Computershare had cancelled four vouchers totalling £220 without contacting him.

He said, 'I'm incensed by this position. I joined Busy Bees (now Computershare) and other voucher schemes in the full knowledge the company would only issue vouchers once they held sufficient cleared funds to do so, and without any indication whatsoever they would be prepared to cancel them if requested to do so by the parent. Many nurseries only accept "guaranteed" forms of payment and we believed that this was one such.'

A letter from Busy Bees to Mr Cooper in October 2008 stated that vouchers are 'as good as a guaranteed cheque.'

However, Computershare, which bought Busy Bees Childcare Vouchers in autumn 2008, said paper vouchers were not a guarantee of payment.

Simon Moore, managing director of Computershare Voucher Services, said parents could legitimately cancel vouchers if they were moving to a new childcare provider, for example, but that as with cheques, if parents cancel vouchers there is no way of knowing whether the reason is legitimate or not.

'We would not state a paper voucher is a guarantee of payment, because just like a paper cheque without a guarantee card, that voucher can be cancelled.

'We apologise for different guidelines being given prior to this time.'

Statement from Sodhexo, Computershare, Grass Roots (Care 4) and Accor, who are working to set up the Childcare Voucher Providers Association:

'Approximately 70 per cent of all childcare vouchers are now issued electronically, so the chances of this situation arising are quite small.

'Voucher providers will always honour a valid voucher - one that is adequately funded. There may be a range of legitimate reasons why paper vouchers may be deemed to be cancelled or invalid. For example, voucher providers may asked by employers or employees to replace vouchers which have been lost in the post, or which have been ordered in error.

'In such cases parents will be aware that the vouchers are invalid, as they have requested their cancellation, or their employer has notified them of an error.

'We are not aware of cases of parents deliberately cancelling vouchers in order to mislead their childcare provider, and believe this situation may have arisen as a result of parents unintentionally using vouchers which they had previously reported as lost, or which their employer had asked them to destroy.

'If childcare providers are in any doubt they can always contact voucher providers directly to confirm the validity of vouchers. We are currently working to complete the childcare vouchers Code of Practice. This will include provisions for dealing with cancelled vouchers.'