Creche costs are set to soar
Friday February 08 2008
HARD-pressed young parents are facing a major hike in creche costs because of rocketing rates bills for the childcare facilities.
In the first of a series of revaluations to be rolled out across Ireland, some creches have been hit with demands for an extra €10,000 in annual rates.
Parents will pay hundreds more for childcare as the facilities are set to pass higher bills directly on to the customer.
The first general national revaluation of business premises since the late 19th century will hit creches particularly hard.
Creches said that because they cannot skimp on labour costs or cram more children in, they will instead be forced to pass on costs to parents.
While the industry is closely regulated, there are fears that parents will turn to the black market to secure cheaper childcare as financial pressures grow.
The news has provoked a storm of protest from childcare providers and parents in South Dublin County Council, the first local authority to be revalued under the programme that will spread around the country over the next few years. The revaluation of the Fingal area has already begun.
Parents nationwide are already paying an average of €227 per week for childcare and now they could be facing an annual increase in charges of around €200 per child.
Rates valuations are based on the net letting value of the premises, and creches have been badly hit because this is a relatively new business area operating at high standards.
The National Children's Nurseries Association (NCNA), representing 750 childcare providers nationwide, is now demanding a change in the law to remove creches from the rateable valuation net, or else it wants local authorities to grant them a rates waiver.
"Parents are now paying much more for their childcare than their mortgage and these rates increases will force up costs even more", NCNA director of services Teresa Heeney told an angry public meeting of childcare providers, parents and politicians in Tallaght.
Inequitable
"The Valuation Office is using the same method of quantifying rates on childcare service as it does any business. This is inequitable because childcare providers operate within very strict regulations," she said.
Because of the upper limits placed on the number of children in a childcare facility, the providers have no opportunity to increase their income, other than asking existing parents to pay more.
She urged the Valuation Office to open a new category for childcare facilities.
Ms Heeney also said there was no level playing pitch regarding rates and that community childcare operators were not rated in Longford, while Meath had waived rates for a community operator.
Some councils turned a blind eye to rates on childcare facilities in general. In Westmeath, some private operators were rated and others were not.
Infrastructure
Ms Heeney said that every childcare and workplace strategy produced by the Government clearly stated that childcare provision was a critical element of the national infrastructure.
But the official approach to childcare provision seemed to be that "once the roof was on, the box to say another 100 childcare places have been developed can be ticked, leaving an operator struggling to run a sustainable quality childcare service".
According to a recent report carried out for the NCNA by consultants Deloitte Touche, rates account for 2pc of a childcare provider's costs.
But this would now double to 4pc, Ms Heeney said. Businesses may appeal their valuation and a spokesperson for the Valuation Office said a number of appeals had already been lodged and more may arrive before today's deadline.
- Katherine Donnelly
