THEY MIGHT NOT be the most imaginative or the most thoughtful present in the world, but vouchers remain enormously popular in this country; according to a recent survey carried out by Deloitte, just over half of us will buy at least one as a gift this Christmas.

The sector has grown to be worth a staggering €350 million a year, with every business from record and book shops to spas, restaurants and hotels keen to flog this little cash cow.

Despite their growing popularity, vouchers are anything but a problem-free solution for people short on time or imagination. According to a National Consumer Agency report published last week, well over half of 142 businesses surveyed imposed time limits ranging from six months to several years on their vouchers, after which they expire and, in many cases, become worth less than the paper they're printed on.

Time limits, which are often hidden either in the small print on the voucher or, even worse, on the small print on a small poster in the shop, are easy to miss. This may explain why 15 per cent of vouchers given in this country are never cashed in.

During the summer, the NCA published a set of draft guidelines on the use of gift vouchers. It recommended that no time limit be applied for redeeming gift vouchers and it called on retailers to scrap restrictions placed on using them during sale times and other promotions.

"Businesses benefit significantly from the gift voucher scheme. They have immediate use of the money paid upfront to purchase these vouchers. They also have the guarantee that consumers will have to give them their custom in order to redeem the vouchers," the agency pointed out. But the retailers weren't listening; and why would they? The 15 per cent of unclaimed vouchers gives them a windfall of around €50 million each year.

The NCA has found that many shops have no proper policy in relation to expiry dates and decisions are often taken on an ad hoc basis. Even where no expiry date is stated, this does not mean a shop operates an open-ended expiry policy. It also reported that people have no right to get change when using a gift voucher, or to a replacement for a lost one.

'CONSUMERS SHOULD CHECK to see if an expiry date applies to vouchers, as they have no redress if it expires before they choose to use it," the head of the NCA Ann Fitzgerald said last week. "With the number of vouchers that will be bought as Christmas presents, it is important for consumers to know their rights and to be aware that some vouchers do have time limits."

Avoca, Brown Thomas, TK Maxx, HMV, Mothercare and Harvey Nichols, for instance, don't have any expiry date on their vouchers. Weir's of Grafton Street has a seven-year limit, Zara has a two-year limit, Arnotts has a one-year limit and Ryanair has a six-month limit.

No one could accuse Fine Gael's enterprise spokesman Leo Varadkar of being short on opinions or slow to express them. Earlier this year he released details of a study which highlighted some of the worst excesses of the Irish voucher industry. It drew attention to an Indian restaurant selling vouchers with a three-month expiry date and pointed towards numerous examples of unfair, arbitrary practices and excessively high administration charges.

"I can't see why vouchers should have an expiry date," Varadkar told Pricewatch last week. "It's a cash grab. They really are a gift for retailers. The bottom line is gift vouchers are given in lieu of cash and there is no reason why they should have an expiry limit. Cash doesn't. Even the old Irish pounds can still be redeemed," he points out.

An even more serious problem which is only likely to get worse next year is the question of what to do if you are in possession of vouchers for a company that has gone bust. A Pricewatch reader contacted us recently after trying and failing to cash in a €300 voucher for a break in a hotel group which had gone into liquidation. She was told by the liquidators that her money was effectively gone and, while she could certainly take her place at the back of the queue of debtors, she effectively had no chance of getting any comfort.

Much the same thing nearly happened earlier this year when Habitat, which operated in Ireland as a franchise, announced it was closing the doors on its shops in Dublin and Galway. Many were left with suddenly worthless vouchers. The Liveline lines were hopping for days until eventually the parent company in the UK stepped in and agreed to honour the vouchers.

If a store that sells a voucher closes down, the voucher holder becomes an unsecured creditor of the retailer who must register their claim with the liquidator. A claim will be considered only after all those of secured creditors, which means it is virtually impossible to get your money back. While it is hard to base your voucher purchasing decisions on the financial well-being of any particular shop, it is still worth considering the likelihood of a company going to the wall before parting with your cash.

SOME VOUCHERS ARE safer than others - the An Post-backed one4all vouchers can be used in many retail outlets and are the closest vouchers get to hard cash; although, like many others, the vouchers have a one-year expiry limit. The company does have a policy for renewing expired vouchers and they charge an administration fee of €8 for reissuing an expired voucher.

The National Consumer Agency's website www.consumerconnect.ie carries detailed information on gift vouchers and gift cards and the conditions attaching to their use. It also contains a list of retailers offering gift vouchers with and without expiry dates.