Donnchadh Ó Laoghaire
Question:45. Deputy Donnchadh Ó Laoghaire asked the Minister for Children, Equality, Disability, Integration and Youth his plans to reduce the costs of childcare for ordinary families. [14666/22]
View answerThursday, 24 March 2022
Questions (45)
Written answers
Significant steps are being taken to support families with the costs of early learning and childcare.
The National Childcare Scheme (NCS) is currently supporting thousands of families to offset these costs. A recent review of the NCS showed that:
- 38% of families reported that half or more of their early learning and childcare costs were covered by the NCS;
- 56% reported that they had more money to spend; and
- 28% reported that they were working more (with 8% reporting they would not be in work without the NCS).
I recognise however that the burden on some families remains high and we need to do more to ensure affordability.
The recommendations of an Expert Group to develop a new funding model for early learning and childcare were adopted by Government in December. This new funding model marks a new departure in State funding of the sector and is a significant step towards ensuring high-quality, affordable, sustainable and accessible services.
An essential and top priority for the Funding Model Expert Group was to make recommendations for a mechanism to control fee rates for different types of provision for early learning and childcare.
There are four specific recommendations on fee management, including the introduction of a fee freeze in the first instance, improvements to price comparability, and developments to the fee management system further to the assessment of cost data.
Fee management will start with a requirement of providers not to increase fees on September 2021 levels. The fee management system will be further developed in subsequent years, informed by income and cost data analysis.
The Expert Group made a further three specific recommendations on affordability, including amendments to the NCS and further development of subsidies linked to household income and expenditure or other criteria.
The Expert Group report informed the transformative package of measures for the sector committed to in Budget 2022, including the new €221 million Core Funding stream. Core Funding will operate from September 2022 to support improved quality, affordability, and sustainability.
Core Funding will have a contractual requirement that fees are not greater than September 2021 levels. This feature of the scheme will ensure that parents feel the full affordability benefits of the NCS and the Early Childhood Care and Education (ECCE) programme.
Budget 2022 also introduced two changes to the NCS:
- Extension of the NCS universal subsidy to all children under 15 from September 2022, benefitting up to 40,000 children.
-Discontinuation of the practice of deducting hours spent in pre-school or school from the entitlement to NCS subsidised hours from spring 2022, benefitting an estimated 5,000 children from low income families
Since the start of the pandemic, my Department has been aiming to ensure the sustainability of services and prevent the additional costs from public health measures being passed on to parents. ELC and SAC employers will continue to benefit from the exemption to the turnover rule for the Employment Wage Subsidy Scheme (EWSS) until April 2022.
In advance of the introduction of Core Funding, a Transition Fund will be available to providers, contingent on an agreement not to increase fees from September 2021 levels. This fund will operate from the end of the Employment Wage Subsidy Scheme until the introduction of Core Funding.
Government has approved the recommendations of the Expert Group. Core Funding and the changes to NCS introduced in Budget 2022 begin the implementation of many of these wide ranging recommendations. Implementation will be further progressed in the coming years as additional funding is secured through the annual Estimates process.
The fee management system, in tandem with developments to the NCS will together deliver improved affordability for families.