Mary White (Fianna Fail)

I welcome the Minister of State and compliment him for batting out on the issue of child care on "Prime Time" last Thursday. As previous speakers and the ladies in the Gallery know, child care is the most important issue facing thousands of parents in all income groups with babies and young children, as well as those couples hoping to have children. The availability of quality and reliable child care places at reasonable cost is a major concern for parents.

Currently, 70% of child care places are provided in the informal economy, by neighbours, relatives and local child minders. However, the availability of such people is shrinking because unemployment is at an all-time low level and, in particular, women of all ages are pursuing careers. The remaining 30% of child care places exist in the formal economy, comprising a mix of full or part-time private and community services.

Listening to the Department of Justice, Equality and Law Reform, one would think it was the other way around and that 70% of child care places were being provided in the formal economy. Despite all the talk of money being invested in child care, it is the informal economy that accounts for some 70% of child care places. I do not to have to spell out what that involves.

There is no question but that, since 2000, EU-backed funding of community child care places has increased by one third, but the number of places available is woefully inadequate in every community. Much good has been achieved but the Government does not realise how inadequate the current child care policy is. For instance, the Government's reliance on child benefit as the main instrument of financial assistance does not make best use of the money spent. The payment of child benefit is largely irrelevant for well-off families and, given the cost of child care, it is of marginal assistance to most families.

In reply to a parliamentary question on 11 May 2004, the former Minister for Finance, Charlie McCreevy, stated, "It has been decided that child benefit will be the main fiscal instrument through which support will be provided to parents with dependent children. Unlike tax relief, child benefit provides support to parents irrespective of their income status". However, I would like to know why at least 12 or 13 official Government documents have suggested that tax relief is the major instrument by which child benefit should be provided. There has been an anti-poverty strategy, a National Development Plan 2000-06, the national child care strategy working group, the national children's strategy entitled Our Children — Their Lives, the report on consultation for a national action plan against poverty and social exclusion, and the White Paper on Early Childhood Education entitled Ready to Learn. The list of reports continues and most of them stated that tax relief was the way forward. When these documents were drawn up by professional people and sent to the Government, the Department of Finance officials decided to approach the issue by way of child benefit.

In November, I made a presentation on child benefit to the Fianna Fáil parliamentary party. Most people sitting in that room did not know that such benefit for the first and second children amounts to €34.50 per week. What in God's name would that sum contribute to child care costs? The cost of child care in Dublin is €800 to €1,200 per month. There are waiting lists for such facilities. The cost to parents with two children in a crèche is the same as having a second mortgage but the downside is that there is no tax relief. The situation is disastrous.

I have studied all the fabulous reports to which I referred earlier but what happened when they went to the Government? Officials from the Department of Finance said, "No, we will do it by child benefit because we want it to be equal for everybody". In that respect, child benefit is a complete and utter farce.

My proposal for tax relief would include parents on low incomes. If they use child care facilities they should get tax allowances or tax credits for their child care places. I do not wish to eliminate anybody but using child benefit as a policy instrument was a good way of avoiding the problem. It was said that the provision of child benefit helped everybody but that argument is pathetic.