The system of Childcare Vouchers was introduced so that there was a mechanism in place to ensure that the money generated through the scheme, was being directed correctly to the childcarers.
When a scheme is set up, the employer is obliged to ensure that all staff members are aware of it. One of the main ways of achieving this is to arrange a presentation, or series of presentations for a larger company. Run jointly by the company and the administrative partner company, they will explain the child care voucher scheme, hand out information including application forms and answer any questions that the employees might have.
Redemption:
Once a child care provider accepts voucher payments, they can be paid in full or in part by parents who are taking part in the scheme. The money for the voucher will be paid straight into the child care provider's bank account. The child care provider can be registered to accept vouchers from multiple administrators.
Registered Carer:
In order to take part in the child care voucher scheme, child care providers must be registered. In England, providers must register with Ofsted; in Scotland the Care Commission; in Wales the Care Standards Inspectorate and in Northern Ireland the Local Health and Social Services Trusts. Registration not only provides access to the scheme, but also gives parents a standard to expect from the provider. Phone numbers for these registration bodies are available on the Fennies Vouchers website.
Relatives:
In certain cases, vouchers can be used to pay relatives who are looking after children. In order to qualify, they must also be looking after other children and must be registered with the appropriate body. If this is not the case, they will not qualify.
Salary Sacrifice:
The child care voucher system works on the salary sacrifice principle. An employee agrees to give up a certain amount of their regular salary in return for vouchers to an equivalent value. They are then taxed only on what remains of the salary for that period.
Savings:
The voucher scheme is attractive because it allows parents and employers to save money. Parents save on their income tax and national insurance bill, thereby making their child care costs cheaper, and employers save on their national insurance bill. Employers use some of these savings to pay the administrative fee to the partner company that runs the scheme for them.
Voucher:
YThe voucher can be either paper or electronic and is used by the parent to help to pay for child care. It will have a value and an identifying number so that the child care provider can redeem the correct amount of money from the right parent. Fennies Vouchers have elected to offer electronic vouchers only.
Date: 08/12/2005
The introduction of childcare vouchers provides a genuine cash saving for working parents, and Fennies Vouchers would like to ensure that the experience of using childcare vouchers is quick and simple, and does not add an unnecessary administrative burden to the already busy lives of the working family.
