Dáil Éireann Debate, Wednesday - 20 February 2019
219. Deputy Anne Rabbitte asked the Minister for Children and Youth Affairs the estimated cost of increasing universal subsidy levels under the affordable childcare scheme by increments of 50 cent up to an increase of €7.00 per hour, in tabular form. [8609/19]
View answerThe estimated costs per annum across the Affordable Childcare Scheme of increasing the universal subsidy in 50 cent intervals up to €7 are set out in the following table. The figures are based on the full cost to the Affordable Childcare Scheme, assuming that the minimum targeted subsidy is increased so as never to be below the universal subsidy in all cases.
The costs are arrived at by:
- establishing the number of families with children under 15 years by income bracket (data supplied by CSO) and
- profiling these families by reference to the age of their children and
- estimating the proportion of children in each income bracket and age range using registered care and
- calculating estimated subsidy rates based on income levels and age profile and
- applying estimates of the average hours used by age group for term time and non-term time.
The cost estimates for subsidies at the existing levels (50c universal and the current targeted subsidy levels) assume a relatively conservative level of change from current scheme uptake. This change is used at a fixed level throughout the estimates. In other words, increased subsidies may create behavioural changes by families which is not factored into scenarios from €1 (universal) upwards (for example, families moving from unregistered childminding to registered Early Learning and Care services that are eligible for the ACS, or families where the second parent decides to return to work).
|
Universal Rate |
.50c |
€1 |
€1.50 |
€2 |
€2.50 |
€3 |
€3.50 |
€4.00 |
€4.50 |
€5.00 |
€5.50 |
€6.00 |
€6.50 |
€7 |
|
Additional Cost per annum |
€ 21m |
€ 43m |
€ 66m |
€ 90m |
€ 115m |
€ 141m |
€ 173m |
€ 221m |
€ 279m |
€ 341m |
€ 405m |
€ 471m |
€ 540m |
The following should also be noted:
- The figures do not include once-off transitional “savers” costs under section 26 of the Childcare Support Act.
- This assumes the minimum targeted subsidy is set by the universal subsidy for all subsidies, including for children not eligible for universal subsidies but eligible for targeted subsidies (i.e. children over 3 whose families qualify under the income thresholds for targeted subsidies).
- As the universal subsidy increases and noting the minimum targeted can never fall below it, the number of subsidy bands reduces as the universal subsidy increases. For example, with €5 universal subsidy there is only one effective band for children 1 and over. Above €5.50 there is only one rate for all eligible families.
Finally, an important factor in considering the levels of investment listed above is the fact that Government has currently no mechanism to control the fees charged to parents in the current market model of childcare provision in Ireland. Increases in the universal subsidies could result in increases to the fee to parents diminishing the intended reduction in cost to parents. First 5, the Whole of Government Strategy for Babies, Young Children and their Families commits to establishing a new Funding Model to address this issue.
