Simon Harris (Wicklow, Fine Gael) | Oireachtas source

I approached this with an open mind, as Deputy Fleming and his colleagues in the Seanad will acknowledge, given the extensive discussions we have had on the issue of child care during the passage of the legislation. I will respond on the amendment relating to child care in more detail but many of the points I will make are also relevant to buildings used for care of the sick and care of the elderly.

The question of exempting child care has been considered on many occasions throughout the legislative process on a number of stages in both Houses. I was pleased to introduce an amendment in the Seanad which exempts not-for-profit providers of child care, as this exemption will remove anomalies, to which the Deputy referred and about which I was conscious, that existed in practice between the treatment of not-for-profit providers by different local authorities and the distinction that has to be made under the legislation between not-for-profit and charitable providers. It is important that we have legislative clarity and that is why my amendment relating to not-for-profit providers agreed by the Seanad brings that into play.

The issue was more recently considered on Committee Stage when the Deputy tabled an amendment that would have exempted all child care providers. I undertook to consider the issue again and I appreciate that the Deputy has altered his amendment and is seeking that parts of the buildings used for the ECCE scheme be exempted and he is not seeking a blanket exemption. I appreciate this response to our discussion on Committee Stage, which reflects a constructive approach on his part to find an acceptable solution to this issue. I take it from the altered amendment that there is an acceptance in the House that for-profit providers of any service should not get a blanket exemption. This has always been my starting point. If one operates a business with the intention of making a profit, one is rateable.

The child care sector can be divided into a number of subsets. Before I tabled the amendment to exempt not-for-profit providers, we had a distinction between them and charitable providers. The amendment removed that distinction. There had been an interpretation of the legislation by the Valuation Office that exempts from rates those that only provide the ECCE year. This is an anomaly and should not be used as a precedent to expand the anomaly. That relates to paragraph 10 of Schedule 4 in respect of education, which has an exemption for ECCE only facilities. The Deputy asked for his reference.

There is an acceptance in his amendment that those that provide non-ECCE services for profit should be rateable. The subject of his amendment is, therefore, a subset: those that provide ECCE and non-ECCE services for profit with the amendment attempting to extract the ECCE part of the business. I apologise if this is difficult to follow but no other sector has been analysed and subdivided to the same extent and it is not my intention to make it complicated. The distinction being made to support the new amendment is not around who is the operator and what are his or her profit motives but who is the perceived customer. As the State is making the subvention, it is viewed as the customer and, by extension, parallels are being drawn with primary schools etc. I cannot accept this argument, as if I do, it will have implications that go far beyond child care. I have to return to the distinction between the child care operator that provides a service for profit and those that are not for profit. Even if I was minded to accept the amendment, there would be major practical difficulties with its implementation. A valuation will hold for five to ten years. The number of ECCE pupils could vary from year to year and, therefore, it would be difficult to arrive at an apportionment of value in advance.

The same reasons I have outlined for not agreeing the child care amendment apply to the amendment that would exempt a part of a building used for caring for the sick under the fair deal scheme. If the provider is operating for profit, then he or she is rateable. There would also be practical difficulties in apportioning a building based on the status of those occupying it. As with the ECCE scheme, the mix of occupants would vary from year to year, which is not helpful in trying to reach a valuation that would be valid for a five to ten year period.

I genuinely appreciate what the Deputy is trying to do and I have given it significant consideration. I am pleased we are clearing up a number of anomalies in respect of child care and bringing consistency to the application of rates for the not-for-profit sector while ensuring a clear understanding in legislation in this regard, which is welcome. Clearly, as a country we have much more to do on the issue of child care but there are many methods and models through which to address it other than through this legislation. It is not a valuation issue. I accept what the Deputy is trying to do but I am afraid I cannot accept the amendment.

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