Professor Peter Clinch:

There are many things that affect competitiveness but if we want to break it down there are two main drivers of competitiveness, namely labour force participation and productivity. The Deputy has covered both in his question. Childcare is something the council identified early. Our contributions on childcare were reflected in the affordable childcare scheme that was then rolled out by Government. It is essential, not only for productivity but also to create an equitable society and to create thriving and sustainable communities. We have looked at the evidence around the importance of quality childcare for long lasting benefits for children, women, families, the economy and society at large so it is even bigger than the competitiveness story as the Deputy knows very well. It is essentially a major indirect cost to business when people have to pay for it and it is leading to difficulties in attracting and retaining staff; to the loss of skilled labour in the economy; and, to people leaving the workforce because there is a lot of churn in the workforce.

Our data show that the average cost of childcare varies considerably across the regions and across the types of childcare used. The Economic and Social Research Institute, ESRI, and Pobal data show that childcare costs are particularly high in Dublin, east Leinster and other urban areas, relative to the rest of the country. The average hourly cost of childcare for a single child, depending on the type of childcare, is as follows: for a childminder in the family home it is €6.13 per hour; for a childminder outside the home it is €4.76 per hour; and, for centre-based care it is €4.82 per hour. The data also show that mothers facing higher childcare costs work fewer hours. They may have a job but they will work fewer hours. Also, a 10% increase in childcare costs is associated with 30 minutes less paid work by mothers per week. The relationship can be seen very clearly there to answer the Deputy's question.

The high costs and limited accessibility of quality childcare are generally attributed to childhood poverty and lower female labour market participation rates. For couples earning 167% of the average wage, Ireland is the second most expensive country in the Organisation for Economic Co-operation and Development, OECD, for childcare-related expenses and for lone parents earning 67% of the average wage, Ireland is the most expensive OECD location so it is a significant effect on our competitiveness.

The single affordable childcare scheme was welcome in providing subsidies with the aim of replacing existing non-statutory childcare schemes and providing subsidies to parents of preschool children. Those targeted subsidies are payable for children up to six months of age. The continuation of a universal subsidy is to be payable for children between the age of six and 36 months. The key point here is that there is a plan. It needs to be rolled out and implemented as soon as possible.