In recent years, I have secured significant additional investment aimed at delivering more accessible, affordable, high quality, early learning and care and school age childcare.
In September 2017, I introduced an increase in the existing childcare supports available for parents on lower incomes. These increases were substantial, with targeted subsidy rates increasing by up to 50%. Parents who qualify for these subsidies can now avail of up to €145 towards their childcare costs per child per week. I also introduced a universal subsidy for children up to three years of age, worth up to €1040 per year.
These measures were introduced as a means of fast-tracking some of the benefits of the National Childcare Scheme which is due to be introduced later this year.
I have also ensured the expansion of the ECCE programme so that children are now eligible for a full two years of the programme from the time they turn 2 years and 8 months. Whilst primarily an early education initiative, the ECCE scheme is estimated to save parents using early learning and care services approximately €5000 per child, over the course of the two years.
A range of measures I have taken have increased capacity in the sector. These include annual capital grants to increase the number of early learning and care and school age childcare places. The numbers of places has doubled since 2014. A number of other initiatives have seen investment in services to assist them in covering their overhead costs and not having to pass these on to parents. For example, a 7% increase in the ECCE capitation in September 2017, and €19.4m in Programme Support Payments annually to service owners to acknowledge the administrative workload associated with Government schemes.
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 will greatly increase the number of families who can access financial support. The Scheme 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 make work pay for parents.
By making this shift and by tangibly reducing the cost of quality childcare, the Scheme aims to improve children's outcomes, support lifelong learning, make work pay and reduce child poverty. It is also designed to have a positive impact on gender equality in relation to labour market participation and employment opportunities.
The Scheme has already been enhanced to expand the benefits for working families. As part of Budget 2019, the qualifying income thresholds were substantially raised.
The significant increase in the Scheme's maximum net income threshold from €47,000 to €60,000 per annum enables some families with a gross income of €100,000 to qualify for income-related subsidies. It means that an estimated 7,500 more children will benefit from the scheme relative to the original proposals. Over 40,000 other children, already eligible, will see increases to their subsidies.
I am also very pleased that I have managed to adjust the lower income threshold, meaning that maximum subsidy rates will now be paid to all families with a net annual income of up to €26,000 (up from €22,700). This ‘poverty proofs’ the Scheme by ensuring that families at or below the relative income poverty line will benefit from the very highest subsidy rates under the scheme.
Over the last four budgets, investment in childcare has risen by nearly 117%. I acknowledge that more investment will be needed. Historic under-investment in early learning and care has created a situation that has no quick solution. The new National Childcare Scheme will establish 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. As such, the Scheme is fundamental to delivering quality, accessible, affordable childcare to families throughout Ireland. The National Childcare Scheme, alongside ECCE, and a host of other initiatives underway will make high quality services more accessible and more affordable for parents in Ireland.