This budgetary move by the Government is another in a long line of budget and other announcements by a Government, which, like its predecessors, has not done its homework on the implications of such a move. This fact is what makes the viability and workability of this scheme so questionable. The introduction of the early child care supplement in the first place was made without any idea of the cost implications. At least six separate times, the then Taoiseach, the then Minister of State with responsibility for children, who now is the Minister for Finance, as well as other Ministers all gave different responses as to the cost implications. At the time, the Government had no idea that it would be obliged to pay the supplement for all EU children with a parent who was resident here, regardless of where the child was resident. This was despite the fact that its purpose was supposed to meet the costs of child care where it was most expensive and unaffordable, namely, in Ireland.
This was of course at a time when the Government thought money was no object and its approach was to find a problem and buy it off or to throw money at it. Instead of attempting to find the best solution or attempting at that point to begin to develop and nurture a successful and viable preschool system in Ireland when the money was available, the Government ignored the sector. It has decided instead to develop it during a recession. The Government simply gave parents a few more quid to use howsoever they wished and ignored the opportunity to develop a long-term system that would serve generations. That is the background to this issue. Fine Gael and other parties produced detailed proposals for the development of a preschool system that recognised the practical steps that had to be taken to develop it. I wish to make clear that Fine Gael fully supports the concept of one year's free preschool for all children and regrets it took the Government so long to recognise its importance.
While the Government finally appears to have seen the light, the details remain hidden, perhaps even to itself. Its amendment to this motion sheds no further light on the issue and does not even reflect what the Minister of State, Deputy Barry Andrews, himself has admitted, which is there will be areas in which places will not be available in January 2010. Fine Gael has tabled this motion because of the deep uncertainty among both providers and parents, who need time to plan their arrangements, particularly when they are operating on far tighter budgets.
One should not forget the Government pulled the rug out completely from under Irish families. Young couples who struggled to pay massive mortgages in an era of pay cuts, job losses and pension levies at least had the early child care supplement to help meet child care costs and originally had the benefit of it until the child reached the age of six. However, the Government began to pull that back last year and then removed it completely for all children from the end of this year. No one has been fooled by the Government's sudden conversion to the importance of preschool. It introduced this measure suddenly in an attempt to blunt the impact and response to this massive cut to families. To use the Government's favourite phrase, "we are where we are". However, the problem is that no one knows where we actually are with this commitment as there are a number of key difficulties, none of which are addressed by the Government's amendment to the motion.
The first and possibly the biggest problem is the issue of cost. According to the Irish Preschool Play Association, IPPA, following meetings with the Minister of State, it seems the capitation fee was set by surveying costs notionally and taking an average the Department believes to be viable. Coincidentally , this figure is practically the same as that offered by the vocational education committees, VECs, for these services. However, this conveniently ignores the fact that the VECs require the service from 9 a.m. to 4 p.m. and allow extra charges to cover this extended period and in effect, the child care provider is able to ensure it is adequately covered for the entire period. Most worrying is that in trying to sort out this issue, there appears to be a veiled threat on the part of the Department, which according to an IPPA statement is insisting "the fund is hard won and generous", to the effect that if services do not make it work, the €170 million may be withdrawn as the sector would be perceived as being unready to implement the funds. In other words, it is a case of take it or leave it, regardless of viability, of whether one can afford to stay open and give a quality education to children. How can one expect a sector to be in a position to implement something so new and unexpected in eight months? It is the manner in which the Government has gone about this that has made it unimplementable, rather than the response of providers.
Has the Minister of State thought about where his plan will stand, were the providers to decide not to take it but to leave it? While he is concerned about creating a two-tiered system, there may be instances in which providers simply cannot continue to exist because of the scheme's impractical nature. How then will the commitment to a year's free preschool for every child be met? Although the providers are practical and know that parents will opt for places offering the scheme, many of them believe they will not be able to remain in operation on these figures. The Government announced this measure without any consultation with the sector on its roll-out or its practical implementation. It has asked the services to be creative and to ensure the scheme works. While they want it to work and parents desperately want and need it to work, it will not and cannot work because providers cannot afford to participate in it. I have met some providers and have examined their figures. This is not a case of seeking more simply for the sake of it but is a genuine issue of viability. Costs are not the same across the country as almost everything varies and rents, rates and wages in particular.
There is also an issue of affordability for parents. This is paramount and the Government should have taken that into consideration before it removed the early child care supplement and before it set the blanket fee of €64.50 for 38 weeks. Many providers will be unable to provide the service for this fee and those that charge below this rate will move up to this figure. If providers cannot offer this service, children will lose out either way. The Government should have negotiated on this issue this prior to the Budget. Did it learn nothing from the over-70s medical card fiasco? The difference in this regard is that families and children will lose out. These services pay wages, PRSI, PAYE, accountancy fees, telephone, ESB and heating bills, water rates, mortgages on premises and loans for equipment. They also rightly must meet strict HSE requirements in terms of staffing numbers and space. The Government is said to be considering the issue of what will be the fee. When will Members know the outcome? When will parents and providers have certainty in this regard as the notion of a voluntary top-up will only make an uncertain situation worse? Members are familiar with the experience of voluntary top-ups in primary schools.
The Government has created this problem and now must solve it in a way that allows preschools to operate and allows parents to afford to send their children. It could consider, for example, a regional difference index based on local authority areas. This would take the basic capitation fee and index it to regional differences in the cost of living, wages, rent and rates and would account for much of the variance that is raising concerns at present. The newly-founded National Association of Private Childcare Providers has also made suggestions and I believe it is meeting the Minister of State, Deputy Barry Andrews, on Thursday to discuss them. However, the Government cannot simply ignore the real difficulties many operators are raising. At an IPPA consultation meeting held to discuss this issue, only two out of 200 present voted in favour of the scheme as presently formulated and this was from a group that has campaigned so long for its introduction.
There is a related issue of duration of service. While the recommended duration for Montessori training is three and a half hours a day, 38 weeks a year, the Government only is offering three hours per day. Parents can be charged for the additional 30 minutes but those who do not wish to pay this can still avail of the three hours. What is to stop a provider only accepting children whose parents are willing to have them stay for three and a half hours? Moreover even if a provider is willing to operate on the basis of both periods, Members can imagine the practical difficulty in a class full of three and a half year olds in which half get up after three hours, pack their bags, put on their coats and exit the classroom. Nothing will happen for those who remain for the final half hour anyway. Montessori training also ideally starts at age two and a half. However, under the rules, children of that age cannot be in the class of those coming under the scheme. For smaller child care or preschool providers, this will mean that where space is limited, such children now will only be minded in crèche-type or child care settings, rather than being educated through the preschool model.
To judge by his statements and replies to parliamentary questions, the Minister of State seems to be convinced that availability will not be an issue and I genuinely question this conviction. The Government's amendment to the motion also states that more than 65,000 additional child care places will have been created by the end of 2010. Ignoring the fact that this will be a year too late to honour the Minister's commitment, this motion is not about child care but pertains to preschool, which is not the same thing.
The Government is now admitting that some issues of under-supply may arise in the initial period, although that is not mentioned in its amendment, but that it will monitor the situation carefully. How big does it expect that gap to be and how does it intend to address it? How will it be addressed for the children affected? Will they simply get nothing, that is, neither early child care supplement nor a year's free preschool? When the Government states that many providers are reporting vacancy rates of up to 25% in their facilities, does it refer to preschools or crèches? Moreover, exactly how many is many? How many areas has the Government examined to ascertain that such facilities have full occupancy and cannot afford to expand because it has removed all financial supports for set-up and expansion?
Finally, there is a difficulty with the imposition of a minimum quota of eight eligible children. It will be a nightmare to administer for smaller services. If only six eligible children are enrolled, they will not be allowed to operate and where will such children then go? This issue must be addressed. Moreover, the tax implications of the scheme must be addressed. I assume that people will only be taxed on the profit at the end of the year, rather than on the fee that will be paid to them.
In short, the principle is something that Fine Gael and I have long supported but the devil is in the detail, or in this case, the lack thereof. The Government has made this commitment and it is up to it and not the providers, to ensure it can be honoured in a workable way.