Patchwork quilt of new measures will go some way to address childcare needs of hard-pressed parents
Published 15/10/2016 | 02:30
One of the lauded measures announced in the Budget was the provision of a new childcare subsidy, won by Minister Katherine Zappone for her Department of Children and Youth Affairs.
The 'Affordable Childcare Scheme' is two-fold in scope and replaces all the other myriad grants and subsidies available, including the 'Childhood Subvention Scheme' and the 'After School Child Care' programme. It is promised to be more stream-lined, with form-filling to be kept to a minimum.
The subsidy won't be available until September 2017 and the minister promises an online application process nearer the time. There are two parts. The first, called (somewhat disingenuously) , the 'universal' subsidy, only actually applies to children being cared for in a Tusla-registered childcare environment, e.g. a crèche, pre-school, day-care centre, Montessori or childminder.
There are 4,500 of these already registered in the country, but just 125 are listed as childminders, despite the fact that anecdotal evidence would suggest there are thousands more working on a casual basis in the black market.
The purpose of the subsidy, and indeed the Revenue's 'Childcare Services Relief' introduced some years ago, which allows childminders earn up to €15,000pe annum tax-free, is to get childminders registered with Tusla. The former measure fell flat on its face, so it is difficult to see how this one will make much difference in that regard. In addition, qualifying childminders will be required to display their charges publicly.
Of those parents who are not stay-at-homes looking after their own children, just 27pc choose to have their children minded in formal crèche/childminding services, with 42pc of families choosing private or alternative arrangements for their children, so the small number actually registered makes no sense.
This is because, in the main, the care providers preferred are relatives and neighbours, sometimes for social reasons but often because they are simply cheaper.
Grandmothers, aunts and neighbours who mind children on this casual type of basis may not, as a result, have the proper insurance, garda vetting or training to do so. It appears that many parents are quite happy to continue this complicit activity and may still be getting cheaper childcare, even without availing of the new subsidy.
The 'universal' subsidy will be available to registered minders looking after children full-time (40 hours per week) aged from six to 36 months, until the Early Childhood Care and Education (ECCE) years kick in. It is not known exactly how much it will be yet, but suggestions are around €80 per month. Creche fees average €900 per month, so it is only a small dint in this 'second mortgage' cost.
Interestingly, the subsidy is available to 'stay at home' parents who choose to put their child in a crèche, as work status is not a defining requirement, just the child's age. It is not, obviously, available to parents who mind their own children and this has caused some measure of disquiet.
The second subsidy is targeted specifically at low-income families. It will be paid to registered childcare services looking after children aged six months to 15 years. This will allow it be used for crucial after-school care, which allows parents to re-engage with work or training.
Eligibility for this targeted childcare subsidy will be based on net parental income. For parents with net income up to €22,700 per annum, the maximum rate of childcare subsidy will be payable, with tapering above this to a maximum limit of €47,500.
Net income means after deduction of tax, USC, PRSI, pension and other allowable items. This would be considered a generous threshold for social welfare applications, so it will have wide-ranging appeal.
The thresholds increase if there is more than one child in the family, e.g. a family with three children under 15 could have a net income threshold of €55,100 (gross income up to €70,000).
The maximum subsidy per hour will range from over €5 for a baby under 12 months to €3.96 for a school age child or, at its maximum, €259 per week toward childminding services.
Additional fees are at the service provider's discretion.
The department says the subsidy should "contribute to the reduction of child poverty, enhance affordability and be more user friendly than existing schemes". In addition, it adds, the measure will "encourage labour market activation" by removing the link between eligibility for social welfare benefits and the medical card with income supports.
Seventy-nine thousand children are expected to benefit from the 'universal' subsidy, with another 54,000 getting the targeted subsidy (including 31,500 already in various existing schemes). This figure is expected to rise in 2018 as demand increases and a separate 127,000 children will access the ECCE pre-school year in 2017.