Brian Lenihan Jnr (Dublin West, Fianna Fail)

I am pleased to address this House and welcome the provisions of this Bill, a number of which impact directly on the new National Childcare Strategy 2006-2010, announced by the Minister for Finance, Deputy Cowen, in budget 2006. I welcome the Government's decision to introduce the new child care strategy in advance of the expiration of the previous one and the subsequent announcement by the Taoiseach of establishment of the new office of the Minister for Children.

Deputies will be aware that I have worked for some time across the Departments of Health and Children, Justice, Equality and Law Reform, and Education and Science. My experience made me keenly aware of the complexity of the cross-cutting issue of child care policy, the difficulties surrounding the delivery of multi-agency programmes and the need for a more integrated approach through the location of child care under the remit of a particular Minister.

An important part of the Government's child care package announced on budget day is the novel decision to introduce a major new payment to parents of young children in the form of the early child care supplement and this Bill gives effect to that decision. The early child care supplement which will be administered by my office is an additional payment of €1,000 to parents in a full calendar year, in respect of all children aged under six years. The payment will be effective from 1 April and will be a direct, non-taxable payment of €250 paid per quarter year, in respect of each eligible child. For the purposes of this calendar year, three payments will be made because the legislation is now before the House. The payment is intended to assist parents with the high cost of caring for children, especially in their early years. The administrative arrangements for the new payment, affecting some 350,000 children, are being put in place and I expect the first of the payments, which would be due at the end of June 2006, to be paid in August. In general, payments will issue early in the month following the end of each quarter. It is the intention to issue the first payment in August 2006 for the quarter from April to June with a further payment in October for the quarter from July to September. Every effort will be made to make payments for the last quarter of 2006 which runs from October to December in December. That is the hope but that period does not expire until the end of December. It is expected that similar arrangements, although somewhat more rapidly executed, will apply in the calendar year 2007. I thank my colleague, the Minister for Social and Family Affairs, for the extensive discussions we have had on this subject and for the fact that his Department has put in place a payment mechanism for the payment.

As with any other payment scheme, care is taken at the planning stage to ensure that it will operate in a streamlined way. This is done to facilitate the recipients of the payments in order that, for instance, they can have the payment paid directly into their bank accounts or through a post office system if this is their preference. It is also done to ensure efficient administration by Government and keep the necessary operating costs of schemes and programmes to a minimum, in the interests of good government.

The early child care supplement deliberately does not distinguish the income or employment status of parents. Some might be critical of this feature, but the Government believes it is right that parents should have choice when it comes to child care. It is not the role of the State to tell parents which child care arrangements are best suited to their families, rather it is for the State to support them in whichever such arrangements are appropriate.

It has also been put on record that the Government's estimated cost of the early child care supplement was based on the take-up of child benefit and includes migrant workers' children who remain abroad. Like any payment, the future costs of both payments have always been subject to several variables, including future birth rates, the number of children who travel with their migrant parents and take-up of the scheme. Both schemes will be monitored, but the possibility that take-up will increase in the future should not prevent us making a payment now that will support parents.

Deputy Neville cited extensively a document dealing with the ending of child poverty. That is an objective to which we all subscribe realising which requires practical decisions. The commentary on the recent budget, of which this Bill is an aspect, described it as a substantially redistributivist budget. I think I am right in saying that the Combat Poverty Agency confirmed that view and said that it will have a significant impact on those with very low incomes. The early child care supplement is one aspect of the budget's redistributivist character.

I welcome the significant increase in child benefit for which this Bill provides. Child benefit supports all parents towards the cost of rearing and caring for their children, irrespective of income or employment status, and represents a major expenditure commitment by the Government to the cost to parents of child care. The increases will apply from April 2006 and child benefit will increase by €8.40 per month for the first two children, to €150 per month, and by €7.70 per month for the third child and subsequent children, to €185 per month.

Another important measure for parents introduced in the budget was the increase in paid and unpaid maternity leave by four weeks from 1 March 2006. This will be increased by a further four weeks from March 2007, bringing the overall duration of paid maternity leave to 26 weeks, and the total duration of unpaid maternity leave to 16 weeks from March 2007. These increases will enable mothers of new-born children and adopting mothers to take six full months of paid maternity leave from 2007. My colleague, the Minister for Justice, Equality and Law Reform, has signed into law the orders increasing the duration of maternity and adoptive leave.

Childminders are an important sector of our child care services and for many parents are the preferred option. It is important that we recognise this resource and support it. The Government has introduced a new childminding relief which is provided for in the Finance Bill 2006, now on Committee Stage. As a result, where an individual minds up to three children in the minder's own home, no tax will be payable on the childminding earnings, provided the amount is less than €10,000 per annum. If childminding income exceeds €10,000, the total amount will be taxable as normal under self-assessment.

To avail of the exemption, an individual will be obliged to make an annual tax return of the childminding income and to notify his or her local city or county child care committee of the childminding service. The Social Welfare Law Reform and Pensions Bill provides for the inclusion of childminding income in the PRSI system where the income is declared for the purpose of the childminder tax exemption. This has the advantage of including the childminder in the social protection system provided through PRSI.

The Government examined this issue at some length and it was decided correctly that the attachment of PRSI to this income would ensure that many mothers who care for children in the home would not fall outside the social welfare net. It is an important decision in principle and an appropriate signal in this area. While childminding is an informal sector, it is important as a minimum that it be brought into the social insurance scheme so that those who engage in childminding can benefit from the right to earn an old age pension and other such social welfare entitlements.

Child care has been at the forefront of this and the previous Government's policy since taking office in 1997 and much ground work has been laid in that time through the equal opportunities child care programme 2000-06.

The development of a coherent child care policy in this time enables us to take a long-term view of the issues which need to be tackled and we are in a position to adopt a more strategic approach to the delivery of services and meeting the demands of parents. The Government's recent decisions on child care represent a comprehensive and timely response, both in terms of the even greater commitment to funding for child care and the establishment of a truly cohesive approach to the delivery of child care services under the new national child care strategy for the period 2006 to 2010.

One of the cornerstone elements of the new strategy is the national child care investment programme 2006-10. The new programme is effective from I January 2006 and succeeds the equal opportunities child care programme 2000-06. Unlike its predecessor, the new programme is entirely Exchequer funded and the Government has committed €575 million to the programme over its five-year term. The Government has not waited for the expiry of the previous programme to launch the new five-year investment programme, which further demonstrates its commitment to the provision of quality child care.

The new programme aims to provide a proactive response to the development of quality child care supports and services which are grounded in an understanding of local needs. It will build on the existing programme and has several ambitious targets, including the creation of 50,000 additional child care places, with 5,000 after school places and 10,000 pre-school places aimed at three to four year olds; improving the quality of early childhood care and education services, including part-time, full day care, school age child care and childminding; supporting families and breaking the cycle of disadvantage; and supporting a co-ordinated approach to the delivery of child care which is centred on the needs of the child.

These are ambitious targets which include the creation of many new additional trained child care personnel. I am committed, however, to ensuring that we meet these targets and objectives in a way that takes account of the needs and best interests of children.

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