Caving into pressure from its own bank-benchers, the Government has decided not to scrap childcare vouchers, after all.

The Prime Minister is not going ahead with his proposed scheme to do away with childcare vouchers and extend nursery care, as reported last week. There has been vociferous protesting from his own MPs and a petition on his own website. 

The Treasury had considered axing the current system when it found out that parents were able to use their tax-free vouchers to settle fees in some private schools, and so giving well-off parents extra tax-free perks.

It was reported in this weekend’s press that the Treasury will instead look at changing the conditions attaching to the vouchers to prevent this perceived abuse. However, as schools and nurseries across the country already accept the vouchers, and also benefit as business (vouchers represent a form of state aid for them too), any meddling with the rules could have some unforeseen knock-on effects.

Those who remember the governments' free computers scheme will remember that it was abolished when somone told the Treasury that parents were using it to buy Playstations. It transpired that this the exception rather than the rule; most parents saw the value of having a PC. Whether this is the case or not in respect of private schools and tax-free child-care vouchers is another matter.