Mr Balls said he wanted to look again at the scope of the Vetting and Barring scheme to make sure the “right balance” has been struck on how many people are covered.
There was outrage last week when it emerged parents who regularly give lifts to other children on behalf of clubs like the Cub Scouts would be required to undergo criminal records and other checks.
Under current rules parents who volunteer to take part in school exchange schemes will also have to be vetted by the Independent Safeguarding Authority.
The review will be carried out by ISA chairman Sir Roger Singleton and will report by the beginning of December, Mr Balls said.
In a letter to Barry Sheerman MP, the chairman of the Commons Children, Schools and Families Select Committee, Mr Balls defended the scheme, and said there was “strong support” for it among children’s charities and in the voluntary sector.
He said asking people to register for vetting was “categorically not a presumption of guilt”, but a “sensible and proportionate contribution to keeping children safe” and compared it to the law that requires people to wear a seatbelt.
But he acknowledged “concerns” about how low the bar for contact with children was set before people were required to register.
Any activity which involves contact with children or vulnerable adults “intensively” - defined as three times in one month, or “frequently” meaning once a month over a longer period is covered, as well as any overnight contact.
It is the precise definitions of frequent and intensive which will form the basis of the review, Mr Balls said.
“Generally, we have found very strong support for the scheme as we have taken this work forward...” he said. “Recently, however, some concerns have been expressed about the precise interpretation of a particular aspect of the scheme; that is the degree of contact with children which should trigger the requirement to register.
“As we have developed the scheme we have been careful to consult on where to draw the line that separates those situations that should be covered from those that should be excluded.
“In particular, a critical point is deciding how, precisely, the ‘frequent or intensive principle’...should be applied to real life situations.”
The Children’s Secretary said he thought the balance in the current rules was “about right” but he added “it is tremendously important that we are certain that this is so.”
Mr Balls said he agreed with the NSPCC that more detailed public information was needed on the scheme in advance of the first applications next July.
Anyone who falls within the rules and is not cleared by the ISA before working or volunteering faces a fine of £5,000. Any organisation which uses them without checks could be fined the same amount.
Registration costs £64 for those seeking employment with children or vulnerable adults but is free for volunteers.
Chris Grayling, shadow home secretary, said the announcement was “not good enough” and called for a review of the “whole issue”.
He said: “I’m afraid this is just not good enough. The reality is that the Government’s words on this are so vague and ill-defined that no one will know where the dividing line falls.
“They’ll look at the level of fines and register everyone to be on the safe side. The Government has to look at this whole issue again.”
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