Dáil Éireann Debate, Tuesday - 1 December 2015
367. Deputy Robert Troy asked the Minister for Children and Youth Affairs further to Parliamentary Question No. 243 of 22 October 2015, for details of the sources or the review of studies he undertook to make the claim (details supplied) that tax reliefs for child care have led to systematic inflation in child care costs in other jurisdictions, including in the Netherlands and in Australia. [42612/15]
Amharc ar fhreagraThe evidence supporting "demand-side" over "supply-side" subsidies referred to in my previous reply was drawn from several sources, including a report published by the OECD in 2006.
Following an in-depth study of 20 countries’ systems for early care and education, the OECD in this report - Starting Strong II - found that the most effective way to make early childhood care and education more affordable – while at the same time ensuring quality – is through "supply-side" subsidies. That means directly subsidising places in early years services so that fees are lower or fully covered (as is already the case for programmes funded by my Department). The OECD, in this report, concluded that tax credits – or other "consumer subsidies" – are less effective and that "direct public funding of services brings, in the majority of countries reviewed, more effective control, advantages of scale, better national quality, more effective training for educators and a higher degree of equity in access and participation than consumer subsidy models".
Start Strong, in their Submission to Oireachtas Committee on Health and Children in May 2015 also presented compelling evidence in relation to this issue referencing both the experience of the Netherlands and Australia. More specifically, this submission demonstrated how "the Netherlands and Australia shifted from supply-side funding to childcare tax credits during the 2000s, and both subsequently saw rise in childcare costs outstripping inflation, and negating the benefit of the tax credits for parents".
The references for the evidence presented by Start Strong are as follows:
- Prof. D. Brennan, ‘The Corporatization of Child Care in Australia’ (see http://www.cccabc.bc.ca/about/files/Brennan_Aust_Child_Care.ppt)
- D. Brennan and E. Adamson (2014) 'Financing the Future' (see https://www.sprc.unsw.edu.au/media/SPRCFile/Financing_the_Future.pdf)
- Prof. H. Penn and Prof. E. Lloyd (2013) 'The Costs of Childcare, study for the UK Department of Education' (see http://www.cwrc.ac.uk/documents/CostsofchildcareJuly2013.pdf , pp.38-42).
