Ministers prepare escape route on nursery vouchers

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The Government will today bow to mounting criticism of its controversial nursery voucher Bill by giving itself an escape route if the scheme proves unworkable.

In a move which goes significantly further than they have yet done in recognising the difficulties faced by the controversial scheme, education ministers have injected an optional element into the scheme.

Until now, Gillian Shephard, the Secretary of State for Education, has insisted that the voucher scheme to be introduced in four local authorities this autumn will be extended to all authorities next April. All parents would receive pounds 1,100 vouchers.

But amendments to the Bill to be tabled by Mrs Shephard tomorrow will give ministers power to make the scheme optional if they decide the first phase has thrown up insuperable problems. The redrafting of sections of the Bill is partly in response to Tory critics who have argued that local authorities already providing good nursery care should not be disadvantaged by the introduction of the new voucher scheme.

But it is likely to intensify the right-wing backlash against Mrs Shephard for not being robust enough against those who argue that vouchers have only a limited role in expanding nursery care. It could also fuel continuing tensions between the Department for Education and Employment and Downing Street, which has argued for a more radical stance on education policy - from nursery vouchers to grant-maintained schools. The scheme has run into difficulties in Westminster, Wandsworth, Kensington and Chelsea, and Norfolk where all parents of four-year-olds have been sent application forms.

In London only half the eligible parents have applied, though in Norfolk the take up is 75 per cent. There is confusion among parents: some with four-year-olds already in school have thrown away their forms because they believe they do not need vouchers. Whitehall officials have also recognised that private providers have been slow in coming forward partly because of fears that the scheme may not be workable in all authorities and partly because of fears of it being overturned by a Labour government.

The changes to the Bill, which reaches its third reading in the Commons on Tuesday, mean the first phase of the scheme could become a pilot after which ministers would take stock and decide what to do.

They could still proceed with a compulsory national scheme or they could decide to target only those local authorities which have the fewest nursery places for four-year-olds.