Dáil Éireann Debate, Tuesday - 25 July 2023
1066. Deputy Sean Sherlock asked the Minister for Children, Equality, Disability, Integration and Youth the additional funding required to reduce the costs of childcare for parents to respectively €50 per week or €100 per month; to provide a breakdown of the additional allocations required, in tabular form; and if he will make a statement on the matter. [36793/23]
View answerThere are two types of subsidies available under the National Childcare Scheme:
• Universal Subsidies are available to all families with children under 15 years old. This subsidy is not means tested and provides €1.40 per hour towards the cost of a registered childcare place for a maximum of 45 hours per week.
• Income Assessed Subsidies are available to families with children aged between 24 weeks and 15 years. This subsidy is means tested and will be calculated based on your individual circumstances. Your rate will vary depending on your level of family income, your child’s age and educational stage, and the number of children in your family.
The Deputy has requested cost estimates of the additional funding required to:
Reduce the costs of childcare for parents to €50 per week.
B. Reduce the costs of childcare for parents to €100 per month.
This Department does not hold individualised fee data for parents as these are local agreements between parents and providers; instead a reduction in the average cost of childcare to parents is examined. To estimate the cost, officials in my Department used data from Pobal on average weekly childcare fees across the country. Assuming a 45 hour week for all children, the following hourly minimum subsidies were derived to achieve the desired outcomes:
Reduce the costs of childcare for parents to €50 per week - €3.27 per hour
B. Reduce the costs of childcare for parents to €100 per month - €.3.87 per hour
As these costings are based on an average fee, the impact of such changes will vary based on the level of fees within the services, patterns of usage and age of the child.
The ESRI SWITCH model was then used to estimate the quantum of the change and applied to the Departments baseline cost of the NCS. The results are given in the below table.
|
Cost of Childcare |
New Minimum NCS Subsidy |
Cost of increase based on application to current NCS cost estimates |
|
€50 per week |
€3.27 |
€244m |
|
€100 per month |
€3.87 |
€318m |
These estimates come with a number of caveats. Firstly, the ultimate impact of changes made to the NCS from Budget 2023 are yet to fully realised and as such extensions to the scheme are based on estimates. In addition, these costing are on the basis of a static system; that is, the model assumes that the level of usage of eligible early learning and childcare remains static. Any changes to subsidies may create a change in behaviour of families, for example, return to/increased labour force participation and use of formal early and childcare for the first time.
