Seán Sherlock (Cork East, Labour)
Link to this: Individually | In context | Oireachtas source

I am grateful for the opportunity to raise this issue today. I acknowledge that the Minister for Children and Youth Affairs, Deputy Zappone, was before the Joint Committee on Children and Youth Affairs earlier today, where she agreed to make available a programme support payment of, as I understand it, approximately €1,500 to childcare providers. In many cases, insurance costs are increasing twofold, tenfold and, in some instances, 20-fold, in particular for non-members of Early Childhood Ireland. A provider in my constituency who paid €550 in 2019 is being quoted €2,100 for next year by Arachas. The operator has been told that if she pays €245 to join Early Childhood Ireland, which is partly funded by the Government, she will only have to pay €1,500. The risk profile of this service has not increased and it has passed all of the regulatory rigours. It is vital that services that are not members of Early Childhood Ireland are not penalised.

Pat Gallagher (Donegal, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

If Deputies adhere to the one-minute allocation, they will be given another minute later. If they do not, they might only be given 30 seconds later.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

The comments of the Minister of State, Deputy Michael D'Arcy, this morning that there is nothing the Government can do to intervene in regard to increasing insurance costs struck fear into many people. Basically, what the Minister of State said is that the cost will either result in the closure of crèches or in the cost being passed on to parents. I have been contacted by many crèches in my area over the last week. The Minister is aware of one of them and she has agreed to meet some of them, for which I thank her. I will give an example. Two parents, both earning €30,000 per annum, pay rent of €1,350 per month - they think they are doing well at that level - and up until recently €1,100 per month for childcare. Owing to changes demanded by Tusla, the cost of their childcare has increased to €1,250. If the insurance cost is added to that fee, they will be in very serious trouble. The woman told me that two weeks into the month, having paid their rent and childcare costs, the couple have no money left. We need to do something. In this regard, I would suggest an increase in subsidies and the establishment by the State of a not-for-profit insurance entity to provide reasonable insurance for childcare providers.

Joan Collins (Dublin South Central, Independent)
Link to this: Individually | In context | Oireachtas source

This issue was raised this morning by two party leaders. The Taoiseach's response was underwhelming. Yesterday, the Minister, Deputy Zappone, said she was shocked and stunned by the hikes in insurance premia. I have been contacted by a number of providers in my area who are overwhelmed by what they are being quoted. One operator of a crèche on Wainsfort Road is facing closure as the quote she received is a 400% increase on what she paid last year. I have heard similar stories from other crèches.

My preference is for public childcare services in this country. I cannot understand why, as a Deputy, I can get public liability insurance for approximately €300 per annum and that when I was a member of Dublin City Council I could get public liability insurance in regard to putting up posters at a cost of approximately €120 per annum. We need to put in place a facility to enable childcare services to link into public liability insurance that is affordable.

Katherine Zappone (Dublin South West, Independent)
Link to this: Individually | In context | Oireachtas source

The cost of insurance for the childcare sector has come into focus in the past few weeks. This has arisen following the withdrawal of an insurance provider from the Irish market and the confirmation that another could not be found. This is undoubtedly causing distress to providers and worry to parents.

I acknowledge there are many providers who are facing increased insurance costs. Until recently, there were two insurance underwriters offering insurance to the childcare sector in Ireland. On 6 December, one of these, Ironshore, notified its 1,300 clients that it would be withdrawing from the market. On 17 December, Padraic Smith and Company Limited, the broker which had provided the Ironshore underwriting services, informed its customers that it had failed to get a new underwriter to take over its client base. This leaves only one underwriter currently offering insurance to the sector, namely, Allianz.

The Government is limited in what it can do in this situation. It cannot compel a private business to remain in the market and it cannot directly intervene in the pricing of insurance offered to childcare providers. However, officials in my Department are working hard to find a way to support those services that have been impacted. We have engaged with Allianz, which I understand has confirmed that it will offer quotes to all but the most high risk services. Allianz, through the broker Arachas, is willing to consider quotes for all affected services. Quotes are being processed within 24 hours in the majority of cases. Some 1,100 quotes had been issued by midday today to previous Ironshore clients.

This leaves 200 providers who have not yet received quotes. I will receive an update on this tomorrow, which will be made available.

There may be a very small number of very high-risk services that will not receive quotations. The press has reported that some providers are reporting significant increases in premiums. I understand that the premiums charged by Ironshore were considerably lower than the market average, which is leading to the increases. I also understand that the average cost of Allianz insurance for full-time childcare is €60 per year per child. The average cost for sessional services, such as the early childhood care and education, ECCE, programme is €25 per year per child. This equates to 0.5% to 0.75% of the turnover of a service.

I understand that the increase is causing difficulties for providers. My Department and the city and county childcare committees are offering a number of supports for providers, including a case management system for services experiencing sustainability difficulties. For community providers, who are one in four of all childcare providers, financial supports can be made available after an assessment through a process managed by the childcare committees and Pobal. I would encourage services to contact their local childcare committee to access a range of supports, including advice or business planning.

With regard to the issue of insurance, I am liaising with my colleague, the Minister for Finance, to consider a review of insurance in the childcare sector as part of the ongoing independent review of costs in the sector. Consequently, we need to make the market more attractive to both existing insurers and to new entrants to increase competition, which in turn should lead to a reduction in pricing and an increase in capacity. For the childcare sector, this includes compliance with regulations. Compliance helps to manage risk. Managing risk is important for children and should also make childcare facilities safer places. I agree with the CEO of Tusla when he says that the childcare sector is largely compliant.

I am glad that I am in a position to make a once-off payment averaging €1,500 to providers to reflect their commitment, especially in a difficult year. This is under the programme support payment I established in 2017 to recognise the administrative burden on providers. This support will come from existing resources available to me in 2019 , and payments will be made by 28 December. The range of payments will be from small amounts right up to €26,000 for the very large providers, depending on the number of children being cared for. It is a fast-moving situation but I am committed to supporting the sector appropriately, and above all to protecting children.

Seán Sherlock (Cork East, Labour)
Link to this: Individually | In context | Oireachtas source

I appreciate the statement the Minister has made on the average payment of €1,500 per provider. There needs to be greater interrogation of how that scheme is proposed to be rolled out. The question is whether it will give comfort to the provider that I referred to earlier. I do not buy the argument made by the insurance sector that risk profile has increased. If people, providers and owners have been compliant up to now, either through the HSE or through Tusla, the Child and Family Agency, I do not understand how their risk profile has all of a sudden increased to the point where their insurance premiums are being increased to the extent of they are.

I go back to the point that I made about one provider who is now being penalised, even though that provider's risk profile has not increased. This provider is being told that if it joins Early Childhood Ireland, it pays €240, the €2,100 that is being quoted now through Arachas is reduced to €1,500. That blows the risk profile argument out of the water. I am hopeful that the Minister will have regard to that.

In the Committee on Children and Youth Affairs meeting today, Deputy Rabbitte called for a dedicated Oireachtas helpline so that we can work through cases like that and bring them directly to the Minister's Department. I also support the call here that Irish public bodies or some other such institution should now be able to step into the breach to cover the risk.

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

The private insurance industry are rip-off merchants. That is what we have learned from the Central Bank. Some of us have been saying that for quite a long time, by the way. The Government said it was all fraudulent claims, particular risks, etc. They are rip-off merchants. We cannot allow the fate of childcare to be dictated by rip-off merchants. We need a not-for-profit insurance entity. That is not radical socialism, by the way. They have done this in Canada in motor insurance. Because motor insurance premiums were going through the roof, the state set up not-for-profit insurance entities. It seems to me that we should have that for childcare, and for other sectors, for that matter.

We have to ensure that administrative, insurance and other costs are not passed on to the already unaffordable cost levels of childcare. In my area, they are the highest in the country, but they are unaffordable everywhere. How is the couple that I mentioned earlier supposed to manage? The national childcare scheme will only give them €20 a week. I made this point to the Minister last week.

Katherine Zappone (Dublin South West, Independent)
Link to this: Individually | In context | Oireachtas source

Did the Deputy check that?

Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

That is from the calculator on the Minister's website. It is €20 a week against those costs.

Joan Collins (Dublin South Central, Independent)
Link to this: Individually | In context | Oireachtas source

The €1,500 additional support payment is in recognition of the additional administration that childcare providers were tasked with in 2019. This is the statement that issued from the Minister herself today. This will go to administration and will not necessarily go anywhere else.

We have to consider deeply what sort of society we are in at the moment. We are dependent on children being looked after in childcare and early learning supports. It is a fundamental requirement for families now to have this. We are leaving it to the vagaries of the insurance market as to whether crèches will survive. Either we have a public insurance body that provides insurance to childcare and other targeted areas or we bring in something like what I and every other Deputy in this Chamber has, which is the ability to get public liability insurance for about €300 a year, or the ability, which I have, through Dublin City Council to get insurance to cover my posters for the year for approximately €120. Why can we not introduce something like this so that crèches can link in and get insurance at affordable prices to cover themselves?

Katherine Zappone (Dublin South West, Independent)
Link to this: Individually | In context | Oireachtas source

I thank the Deputies for their comments. I take the points that Deputy Sherlock is making on the differences in the costs of Early Childhood Ireland members and those who are not members and how the risk profile is not necessarily different. These are good questions which I will raise as part of the ongoing considerations.

On other issues, including the call from Deputy Rabbitte for an Oireachtas helpline, we need to get such a helpline set up so that there can be access to this information as this is a fast-moving situation. More information is coming in on insurance quotes that are being offered to as many crèches as possible. My overall objective is that there are no closures. In the very short-term, one of the things we have done is to provide a programme support payments of, on average, €1,500 to providers. We will make provision as to how that is determined. The formula for each crèche is the same formula we have used in the past for programme support payments, which is in respect of the number of children and whether they are in full or part-time childcare. It will differ from smaller to larger crèches. The payment will be made by 28 December and the providers will not have to do any more administration to get this payment.

I have also identified a sustainability service that Pobal also offers to ensure that facilities will not close. The not-for-profit element is certainly part of that, for which there is potentially additional funding.

On Deputy Boyd Barrett's point, I am hopeful that because of the things we are doing to support the providers in a difficult year, the cost rises across the board, insurance being part of those, will not escalate. We need to look at that, which I fully accept.

I take his point and that of Deputy Joan Collins on there being other kinds of not-for-profit models of insurance provision in other jurisdictions. I am going to feed those into the work on insurance, which is happening in the Department of Finance. We are looking for more data, particularly in the way that insurance premiums are rising, and will be feeding that data into the engagement with our colleagues. There is perhaps a better way for our sector compared with others.