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LSE research shows economic benefits of care voucher scheme

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Research released today (11 July) by LSE's Personal Social Services Research Unit| (PSSRU), has shown that tax exemptions on care vouchers provided by employers in the UK would allow carers to continue to work by providing additional support in the home.

The report, Tax Exemptions on Care Vouchers for Working Carers - an Economic Analysis, by Tom Snell|, José-Luis Fernández| and Russell Bennetts, looks at three scenarios based on a low uptake (demand for vouchers was less than observed in similar schemes , central uptake (based on take up of similar schemes) and high uptake (greater availability than in similar schemes) of the proposed tax exemptions scheme:

  • A low uptake would cost under £22 million to the state, providing £49 million worth of vouchers
  • A central uptake would cost the state around £37 million, generating £83 million for care services
  • And a high uptake would cost the state approximately £120 million, and the value of vouchers purchased was over £271 million

The research shows that the vouchers would be an effective and affordable way to bring extra funding to older and disabled people, and would help businesses to retain the skills of their valued and experienced employees.

The tax break could be used to buy a range of services for older and disabled people, including extra home care. A similar scheme is already helping parents with the costs of childcare and could easily be adapted to meet the needs of carers of older or disabled people.


For more further information contact, Tom Snell on 020 7955 7692, email t.r.snell@lse.ac.uk| or José-Luis Fernández, email j.fernandez@lse.ac.uk|

Further details are available at www.carevoucherscampaign.co.uk|

Press cuttings

PM Online
Voucher campaign for carers launched (19 July)
A report by the London School of Economics has shown that caring is a major cause of early retirement, with 80 per cent of carers who are aged 50-60 forced to give up work. 

Daily Telegraph
Major firms back tax breaks for carers (11 July)
Carers should have tax breaks to allow them to remain at work, employers and charities said yesterday. The London School of Economics has assessed a scheme that would give tax breaks in return for care vouchers. These would be provided by employers as a benefit to staff who are carers.

Charities call for carers' tax breaks

Channel 4 News
Tax breaks urged to help carers (11 July)

11 July 2007