Dáil Éireann Debate, Tuesday - 4 April 2017
685. Deputy Kathleen Funchion asked the Minister for Children and Youth Affairs the estimated cost to increase the average subsidy under the new universal scheme for every €50 million per annum increase in investment over a five year period. [16072/17]
Amharc ar fhreagraBudget 2017 provided an additional €19m to enable the introduction of a new single Affordable Childcare Scheme. This is in addition to the existing funding which supports the current targeted schemes and which equates to €87m annually. The full year costs of the scheme will be approximately €150m.
Of this €150m, the expected cost of the universal element of the scheme is approx. €17m per year, i.e. approximately 11% of the total scheme cost.
The impact on the universal subsidy of a €50m increase in the overall scheme budget would depend on what policy decisions were taken about how the additional funding was used, for example in relation to the balance of spending between the universal and income-related elements of the scheme.
If it is assumed that the current balance were retained, then the additional spending on the universal element of the scheme would amount to 11% of the €50m, i.e. approximately €5.5m.
Based on an assumption of no change in the number of beneficiaries of the universal subsidy, a €5.5m increase in spending on the universal element of the scheme would allow a one-third increase in the universal subsidy-rate per hour, i.e. an increase from 50c per hour to 67c per hour. In practice, however, an increase in the universal subsidy rate is likely to lead to an increase in the number of beneficiaries, as the reduction in childcare fees paid by parents would lead to an increase in demand for childcare. As a result, the potential increase in the subsidy-rate, within a fixed budget increase of €5.5m, would be less than 67c per hour.
