Jack Wall (Kildare South, Labour)
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As three Deputies are offering on this matter, each speaker has one and a half minutes.

Dan Neville (Limerick West, Fine Gael)
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A minute and a half is very little time. If I had known that, I probably would have withdrawn the matter and resubmitted it at a later date.

I wish to raise the issue of the replacement of staffing funding for community child care services with the proposed community child care subvention. The change will have serious consequences, especially for rural child care facilities. Currently, 21 community groups provide sessional, full-day and equal opportunity school-age child care in County Limerick. A further 11 groups have recently received funding under the equal opportunities child care scheme and national child care investment programme or are in the process of applying for such funding. The County Limerick community child care forum feels the introduction of the new scheme will result in inadequate child care provision and that children from disadvantaged backgrounds will be segregated from their peers. It is also felt that the introduction of bands A, B and C, as proposed, will lead to classification of parents, thereby reinforcing the social class stigma. Further, the scheme will reduce the level of funding available to community child care services which are already experiencing shortfalls.

Under the community child care subvention scheme, children whose parents are in receipt of social welfare benefit will be subvented to attend community care services. The process will require parents to complete a form outlining PPS and social welfare details which will be available to those of their peers and neighbours who are organising a local scheme. The form will be submitted to child care services and the office of the Minister of State with responsibility for children and the Department of Social and Family Affairs who will determine if a child is eligible for subvention. According to the type of social welfare being received, a parent is labelled "A", "B" or "C". Subvention is made in respect of categories A and B but not C.

The proposed scheme raises many serious issues. It is calculated on foot of case studies in the mid-west that many child care facilities will be put out of commission.

Deirdre Clune (Cork South Central, Fine Gael)
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I am delighted the Minister of State, Deputy Brendan Smith, is present as I have written to him on the matter previously, as, I am sure, have many other Deputies. The Minister of State must address the changes he is making to the circumstances of low income parents who are dependent on community child care facilities to facilitate their access to work. It is these parents who have raised their concerns with me and told me how they have benefited enormously for the last six or seven years from the availability of valuable community child care centres. The centres are community-based, accessible and low cost and they facilitate those who otherwise would be unable to enter employment. These parents will be squeezed out by the changes the Minister of State proposes to implement from next January. They will be unable to avail of prohibitively expensive private child care and their only option, as some have suggested to me, will be to become welfare dependent once more. Many of them do very valuable work in the community.

Child care facilities were intended originally to allow people to return to education and work and the proposed changes represent a backward step. The Minister of State mentioned in his letter family income support, but such support cannot meet the cost of child care. I ask the Minister of State to address the circumstances of parents on low incomes who will be severely affected by the proposed changes.

Niall Collins (Limerick West, Fianna Fail)
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I submitted the matter for consideration last week on foot of a heavily attended public meeting in my constituency at the Woodlands House Hotel in Adare. The meeting on the introduction of the new child care subvention scheme was attended by 250 to 300 child care providers operating within the community child care service as well as by parents. The groups in question are grateful to the Government and its predecessor for the capital funding which has been made available to build very fine community-based crèche facilities. A number of crèches in my constituency have received very significant funding, including €1.2 million for St. Coleman's community crèche in Kilcoleman, €1.4 million for Broadford community crèche in Broadford, Charleville, and €1.7 million for Rathkeale community crèche. A further crèche is under construction in Banogue, County Limerick, with a capital grant of €525,000. The funding is very significant. Operators, children and parents benefit from the grants as no capital or mortgage repayments are factored into child care costs.

Interested parties are saying that the subvention scheme has not been the subject of proper consultation and will create an urban-rural divide and that the existing system works against integration. The proposed scheme will compromise job security and lead to high staff turnover with a resultant lack of continuity of care.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I thank the Deputies for raising this important matter.

The main supports the Government makes available to parents to assist them with their child care costs are child benefit and the early child care supplement. The latter payment recognises the higher child care costs of pre-school children, is the responsibility of my office and alone amounts to expenditure of over €400 million in a full year. These payments are universal and benefit all parents regardless of income, labour market status or the type of child care they choose. In addition to these universal supports, Government child care policy has also recognised the need to target additional supports at disadvantaged families. It is in this context that the equal opportunities child care programme was established some years ago with targeted support provided through the staffing support grant scheme.

Community-based, not-for-profit child care providers with a strong focus on disadvantage were awarded grant aid towards their staffing costs to allow them to operate with reduced fees to disadvantaged parents. Funding under the scheme was originally awarded for a limited period during which services were expected to move towards sustainability. The funding was subsequently continued to the end of 2007 where it was considered necessary to enable services to remain accessible to disadvantaged parents. Continuation funding was subject to the condition that tiered fee structures were implemented by the services in question.

Under the National Childcare Investment Programme 2006-10, the successor programme to the EOCP, a new scheme to support community child care services with a focus on disadvantage will be introduced on 1 January 2008 and will continue to complement the universal supports in place for all parents. The community child care subvention scheme has been allocated €153 million for the next three years, representing a 16% increase in funding over the EOCP staffing scheme. Under the new scheme, services will be grant aided according to the service they provide and the profile of the benefitting parents. In turn, the subvention received by the services will be reflected in the reduced fees for parents who qualify as disadvantaged under the scheme.

I am sure the Deputies will agree that the provision of additional targeted support for disadvantaged families is a necessary component of any equitable system for supporting families with the cost of child care. Any such targeted approach must have a cut off point and it was considered that the income limits for family income supplement were the most appropriate given the scale of the scheme and its focus. Deputies may be aware that the current FIS limit for a family with three children under 18 stands at €625 per week, while the minimum wage currently stands at €8.65 per hour. As of March 2007, the average industrial wage amounted to €615 per week.

It is considered that the new scheme will provide an effective framework for the continued targeting of additional resources towards disadvantaged parents and their children while continuing to support community child care services generally. The scheme has been informed by and takes account of a number of enhancements recommended by the report of the value for money review of the EOCP. These include the fact that the subvention to services will be more responsive to the level of service provided as well as the degree of parental disadvantage supported. The ceiling for funding which existed under the previous scheme is being removed. Account will also be taken of all operational costs of services rather than staffing costs alone. Services, including full-time, part-time and sessional ones, which are in some cases inaccessibly priced for disadvantaged parents will be available at more appropriate rates under the new scheme.

Existing EOCP staffing grant recipients who enter the new scheme will continue to be funded at their current level until July 2008. My office is currently engaged in a series of meetings with existing grant recipients to outline to them the details of the new scheme and to gather feedback from the services. A meeting with representatives of the city and county child care committees has already taken place.

I do not think any purpose would be served by suspending the introduction of the scheme. The more detailed and comprehensive data which will be generated by the new scheme between now and the end of December will be analysed by officials in my office, as was announced last July. If appropriate, any adjustments necessary to secure the best outcomes for child care services and for disadvantaged parents and their children will be considered by the Government in early 2008 and well in advance of the commencement of the new funding levels in July 2008. In the meantime, groups can continue to receive funding at their current rate up to the end of June 2008. To qualify for the continued funding, groups are required to submit the information required for the assessment of the impact of the new scheme by early November 2007 and I would appeal to them to do so. It is important to emphasise that there will be no changes between now and July 2008.

It is worth repeating this Government has built a formal child care structure virtually from scratch. Since 2000, we have created over 35,000 new child care places in the community and private sector and supported over 26,000 more. Under the EOCP, €500 million has been allocated from 2000-06, accounting for over 3,300 grants to a mixture of community and private providers. The successor programme, the national child care investment programme, of which the child care subvention scheme is a part, has been allocated €575 million over the next three years and is on target to create 50,000 additional child care places, with a greater focus on pre-school places for three to four year-olds and school age child care. In real terms, this Government will have spent over €1 billion of public money on the child care sector by 2010. Given that the new subvention scheme actually increases funding by 16% over the EOCP staffing scheme, I refute in the strongest possible terms the claim that the Government has suspended such support. Nothing could be further from the truth and, as I have noted, any adjustments which might be considered necessary will be considered by the Government once the relevant data has been analysed.