Tuesday, 23 July 2019

Questions (2550)

Thomas P. Broughan


2550. Deputy Thomas P. Broughan asked the Minister for Children and Youth Affairs the estimated cost of continuing the CETS and CCS schemes with the national childcare scheme; and if she will make a statement on the matter. [32920/19]

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Written answers (Question to Children)

Through the National Childcare Scheme and a range of other measures, I am committed to changing Ireland’s childcare system from one of the most expensive in the world to one of the very best. In designing the National Childcare Scheme, extensive research and consultations have been carried out to ensure that this goal is achieved and that the Scheme can help as many families as possible.

The National Childcare Scheme (NCS), when introduced this October, will replace the CCS and TEC schemes with a single, streamlined scheme. The shift from those legacy schemes reflects an evidence informed approach to subsidising childcare driven by the key objectives of :

- Streamlining the existing targeted schemes to make them more accessible for both parents and providers,

- Providing a fair and consistent system of progressive financial support towards the cost of childcare, with a particular focus, at least initially, on low income families but also incorporating universal supports, and

- Providing a robust and flexible platform for future investment in childcare in Ireland.

It is not possible to accurately assess the cost of running both the new scheme and the old schemes in parallel as they would both largely be targeting the same groups who may opt for either scheme, or individual providers may choose to make only one or the other available to parents availing of their services where all schemes are open and live. An infrastructure would be required to support both which would not be cost efficient.

However, critically, arrangements are in place to ensure that no one loses out in the initial transition to the new Scheme. Families accessing “legacy” schemes can continue to access their current targeted supports (including CCSP and CETS as well as CEC and ASCC), remaining on their current payment, until the end of August 2020 or they can opt to move to the National Childcare Scheme. In this way, the scheme will effectively continue to run for those families and for providers. It is estimated that the subsidy cost of this transitional provision could be €16m for the programme year 19/20. It should be noted that there is considerable margin for error as it will depend closely on the number of individuals who are in work or study and are participating on current schemes. This information is not available.

The NCS replaces four legacy schemes and in doing so addresses some of the issues associated with these schemes, embedding a “money follows the child” policy approach. As well as increasing the number of families who can avail of subsidised childcare, it removes many of the restrictive eligibility requirements of the existing support programmes, whereby a parent must be in receipt of certain Social Protection payments or a Medical Card in order to receive targeted supports. In this way, it aims to combat the poverty traps which may exist within the existing schemes, and to appropriately incentivise employment and education / training for parents. Many parents will see an increase to the level of subsidy they currently receive.

From a provider perspective the new scheme simplifies and streamlines business processes, not least because it allows parents apply directly for subsidies instead of going through their childcare provider.

Running both schemes simultaneously and beyond a transitional period would undermine the original intent of the NCS. It would create a considerable technical and administrative overhead for both the scheme administrator and service providers. It would also undermine the significant work done to build a system which greatly improves the governance and compliance associated with the use of Exchequer funds. NCS addresses many of the governance and compliance concerns associated with the legacy schemes.

It is worth noting that the new scheme is not static. The National Childcare Scheme establishes a sustainable platform to enable us to continue investing for years to come. The Scheme is designed to be flexible, allowing income thresholds, maximum hours and subsidy rates to be adjusted in line with Government decisions and as more investment becomes available. The Minister and Department have committed to monitoring and reviewing the progress of the scheme. Continuing legacy schemes indefinitely would be a retrograde step for children, parents, providers and for the State.