Community Childcare settings provide a valuable service to children and families across the country, including the provision of vital services to vulnerable families in areas of disadvantage.
Over the last four budgets, my Department has increased funding for early learning and care and school age childcare by 117%. A significant proportion of this funding has been targeted at families who use community childcare services, thus assisting with the sustainability issues faced by some services.
The National Childcare Scheme will further increase investment in childcare and will reduce the top-up many parents have to pay for their childcare. This will have corresponding benefits especially for community providers. The National Childcare Scheme is also expected to increase demand for services, thereby supporting community services to operate efficiently and at full capacity.
The National Childcare Scheme, when introduced in October, will represent a major landmark for children and families in Ireland. It entails a fundamental shift away from subsidies grounded in medical card and social protection entitlements, and towards a comprehensive and progressive system of universal and income-based subsidies. By making this shift, and by tangibly reducing the cost of quality childcare for thousands of families across Ireland, the Scheme aims to expand access, 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.
A core design feature of the National Childcare Scheme is that “money follows the child”. Once a parent has been approved for a subsidy, they should be able to choose any registered childcare provider participating in the scheme, subject to availability, and the subsidy would then be paid directly to that provider. There could be concerns that this could reduce the sustainability of community services by increasing choice of provider. However, the underlying reasons for financial stability problems faced by some community providers do not rest with the nature of the funding model but with a wide range of other factors. Examples of these may include the current inability of some parents to pay the level of fees asked of them, the broader range of family supports provided by some services in disadvantaged communities and the particular business models operated by certain services. By creating a clearer, more flexible and more user-friendly scheme, which explicitly links funding to parental income and to the costs of provision, it is intended that the National Childcare Scheme will offer a vehicle for addressing some of these concerns.
For services which are facing financial sustainability challenges, my Department oversees an integrated Case Management system operated by Pobal. This Case Management service provides non-financial assistance or support in the first instance. Financial supports are also available for community services facing certain challenges which may also be accessed through Case Management following a financial assessment.
In addition, my Department has commissioned an independent Sustainability Review to examine the financial situation of a selection of community childcare services in some of the most disadvantaged areas in Ireland, taking account of the future introduction of the National Childcare Scheme. I expect to receive this analysis very shortly which will inform any necessary refinements or enhancements to the National Childcare Scheme or, indeed, any other policy responses which may be appropriate. In the interim, arrangements are in place to ensure that no one loses out and that families can continue to access their current targeted supports as we transition to the new Scheme.