Come April, four-year-olds in primary and nursery schools, pre-prep schools and playgroups, social services day nurseries and private nurseries will all be arriving with their vouchers. In Scotland, but not England and Wales, childminders who meet the quality threshholds will also be able to accept vouchers.

The pilot in four local authorities has shown that the scheme can be made to work, although its benefits in terms of increasing provision, choice and quality remain a matter for debate.

There is still a great deal of confusion surrounding the scheme. Not only parents, but many infant teachers and heads are not clear about just who needs vouchers and how they operate. This TES guide sets out to answer some key questions.

Who will be entitled to a voucher?

The voucher covers three terms: from the term after a child’s fourth birthday, until the term during which the child turns five. This means that the voucher applies to the year leading up to the statutory school age. The term “nursery voucher” has proved misleading, since 85 per cent of four-year- olds are in school, according to the National Children’s Bureau. Some parents have not understood that their four-year-old in Reception needs a voucher, but their three-year-old in nursery doesn’t.

How much is the voucher worth?

The voucher’s value is Pounds 1,100, or Pounds 367 a term, or Pounds 6. 67 a session (for five sessions a week for 33 weeks). This is more than the playgroup fee of up to Pounds 3.50 a session but often less than the cost of private provision, and parents will have to “top up”.

How do parents get their vouchers and what do they look like?

Capita, the agency contracted to administer the scheme, will write to all eligible parents in January and invite them to apply. Parents then need to send back the form and will receive the voucher in February. This comes in an A4 booklet, which is sent to parents every term. It includes a list of local providers and a sheet of 15 coupons. There are five counterfoils for parents to keep, five coupons for the provider and five for the provider to send to Capita. Vouchers can therefore be split between two different settings. However, the vast majority of parents use only one.

Any parent who is not contacted may ring the Voucher Helpline on 0345 543345. Parents who want to move their child at half-term should also ring for a new booklet.

How do providers join the scheme?

The DFEE is now sending “join the scheme” packs to all playgroups, private nurseries, grant maintained schools and other non-LEA providers. Participation is optional for private and voluntary providers, as well as for social services day nurseries. They are advised to join before the end of the year to ensure that they are included in the lists of local provision sent to parents. They will then get a further welcome pack with additional documentation.

Local authority schools will automatically be signed up by their LEA.

How and when will providers get the money?

This is straightforward for private and playgroup provision. The parent arrives and presents the voucher; the school or group sends the coupons freepost to Capita; and the Department for Education and Employment is confident that the money will arrive in their bank accounts within two weeks. The funds are paid each half-term.

TIP: “The best tip is just to follow the instructions they give you”, says Sue Meaney, leader of Stowe Pre-school in Westminster, one of the pilot authorities.

All four LEAs in the pilot paid their schools through the LMS formula in advance as usual, based on estimated numbers. The voucher money then went to the LEA once redeemed. Most local authorities are planning to adopt this practice, but some may not, leaving schools to fend for themselves.

Pilot schools say that the support and cooperation of the local authority has been crucial.

TIP: “Lobby your LEA to advance the money under LMS”, says Bernadette Duffy, head of Dorothy Gardner combined nursery centre, Westminster.

Who needs a voucher?

All four-year-olds in maintained schools. This includes children already in both Reception and nursery classes. This has caused a great deal of confusion and some resentment among parents in pilot areas, and some have thrown their vouchers away. Without a voucher, the school or LEA cannot collect the money.

Parents who have lost or tossed their vouchers can get a new one from Capita.

What happens if a parent is unwilling or unable to produce a voucher?

Each school is issued with a small number of “blue forms”, “school-issued applications forms which can, in exceptional circumstances, be completed by the school on behalf of the parent”, according to the DFEE. These were needed in about 2 per cent of cases in the pilot.

How are admissions policies affected?

In most ways, they are not. Children will enrol in the normal way, and pupils should be selected for places in accordance with existing admission criteria. A voucher does not entitle a child to a place in a school which has no room. However, “admission authorities” - usually local authorities, but sometimes schools, now have a legal right to refuse to provide, or continue to provide a place in a maintained school for a four-year-old if the parent does not present a voucher. They may change their admission arrangements accordingly, after consultation, to say that any offer of a place is conditional upon presentation of a voucher.

DFEE advice says, “In most cases the school will want to admit the child provisionally but should make it clear that the child may not be able to continue at the school if they do not bring in a voucher.” They say two weeks leeway might be reasonable if the parent has the voucher at home, but for the first few terms schools may wish to give parents longer. In really difficult situations they may use the “blue form”.

What happens in April?

TIP: “Do not underestimate the amount of time you need to give to it”, says Bernadette Duffy.

She and her deputy spent two hours a day for a week clarifying the system for parents, and helping with the paperwork. Four-fifths of heads in the pilot surveyed by the DFEE said the administration was time consuming, particularly organising paperwork and helping parents. The DFEE says it has been simplified in the light of the pilot experience.

Mrs Duffy said reassurance from the LEA that schools would not lose money, and that provision for three year olds would not be reduced was valuable.

TIP: “Inform everyone in advance”, says Vivien Fotiadis, headteacher of Colville Primary School in Kensington and Chelsea. She says administration ran smoothly because meetings were held before the scheme began to explain it to all concerned parties.

The vouchers are collected by a member of staff, usually an administrative employee.

Some teachers are also afraid that the demand for vouchers will damage home-school relationships, particularly where they are sensitive, as with travellers or refugees.

The DFEE is organising a massive advertising campaign, including TV adverts, to explain the system to the public.

For private and voluntary providers collecting vouchers is more straightforward, as parents know they need a voucher, or they will have to pay themselves. These providers already have a system for collecting money from parents. However, some private nurseries have charged parents the full amount and then reimbursed them once the voucher was redeemed.

Voucher helpline: 0345 543345.

HOW THE MONEY GOES ROUND

The scheme is funded with Pounds 545 million recouped from LEAs and Pounds 165m new money. This is where it goes:

* Capita receives parents’ details from child benefit database

* Capita writes to parents with application form

* Parents apply for vouchers

* Parent chooses nursery setting and applies with their voucher

* Nursery setting collects voucher and sends it either direct to Capita or (if a school in some of the authorities) to the local authority

* Local authority sends all school vouchers to Capita

* Capita sends the money to the local authority or the setting.