Katherine Zappone (Dublin South West, Independent) | Oireachtas source

I thank the Cathaoirleach. It is a great pleasure to be in the Seanad this afternoon. This is my first opportunity to be here as Minister, but I assure the House I was looking forward to it greatly. The time I spent here was some of the best time of my life. I am delighted to have the opportunity to discuss my work in the Department of Children and Youth Affairs, and I look forward to hearing the views and input of Senators.

As Senators are aware, my remarks are timely, coming a week after the announcement of budget 2017 and just as the long overdue public, political and media debate on child care is finally under way. I want to share a vision for a future which has affordable, accessible and high-quality child care policies, vibrant youth services, best practice assistance for young people with difficulties and, above all, an inclusive future that values all children for who they are.

Through listening to children and affording them the freedom, dignity and all the respect they deserve, we can build a caring, engaged and flourishing society from the ground up. In the budget last week, I was pleased to secure a 15% increase in funding for services to support children, young people and families. Additional funding of €173 million brought the total funding of the Department to more than €1.3 billion. This is a hugely significant investment which has grown, even through adversity, and is helping to create a fundamentally different approach to how the State engages with its children and young people. The funding increase will allow us to introduce a radical new approach to child care, with high quality care and education that is open to all children, and deliver extra community youth services throughout the country and better funded supports for young people and families who need it most.

Children deserve to be free of fear, poverty and deprivation and to feel safe and valued. I look forward to continuing my work with children, young people, parents and front-line services to ensure the money secured in the budget will be used to deliver the best possible outcomes for all.

A major policy priority for me is the development of a single affordable child care scheme. This will replace existing child care subsidisation schemes, excluding the free preschool scheme, with a single streamlined scheme from September 2017. This is an ambitious timetable, but the Department is working intensively on it. The new scheme is a major step in making quality child care more affordable and will enable universal and targeted subsidies for parents towards their child care costs.

Under the targeted measure of the new single affordable child care scheme, parents will qualify based on their net income.While I do not wish to pre-empt the input of Senators, let me first clear up some misinformation which has entered the debate and unfortunately become part of the discourse on the scheme. The policy proposals for the new scheme were always based on net income and there are a number of reasons for this. A net income approach better provides for a fair and reasonable measure of the resources available to a family. It ensures an equitable approach to assessment across incomes that are subject to taxation and incomes that are largely non-taxable. Basing the approach on net income best supports equal treatment of all different types of income and best supports people to move from social welfare to employment or increased hours of employment. As such, the approach is supportive of equity and labour market activation policy objectives and should ensure the scheme is helpful to working families on low to moderate incomes, prioritising those on the lowest incomes. I hope this will be particularly effective for the children of lone parents and those children who are living in households below or close to the poverty line.

Subsidies will be available for children aged from six months to 15 years and will meet families full-time and part-time child care needs, including outside of school hours and during school holiday time. This will also assist the early years workforce. I am fully aware that some of these staff currently have 38-week contracts only. The new scheme will subsidise parents' child care costs beyond term time, creating full year and sometimes full-time contracts for more child care staff.

International research confirms that access to high quality and affordable child care is particularly important and beneficial for children from lower income families. First and foremost, education and employment is the best route out of poverty. Affordable child care supports parents in lower income families to access further education and the labour market. While labour market activation is a key policy objective of the scheme, it does not force parents into the workforce but simply provides them with a choice. If families have access to affordable child care, some will continue to choose to remain in the home with their children and some will opt to increase the household income through employment. This scheme will give families a real choice. According to data from the Central Statistics Office, 19% of people in jobless households are in consistent poverty compared with 8% of those in households with one person working and only 1.5% of those in households with two people working.

I also want to be clear on a point regarding whether formal child care is good or bad for children. The research on this area is also clear. High quality child care supports child development and this benefit is greater for children from disadvantaged backgrounds. For this reason, I have ensured the overwhelming majority of funding available under the single child care affordable scheme in 2017 will be targeted at lower income families, with a subsidy of approximately €8,000 per annum available at the highest rate based on the maximum of 40 hours of child care per week, although it is not a requirement that child care is provided for 40 hours per week. It is my hope that this will help families to overcome disadvantage and contribute to a reduction in child poverty. Under the initial terms of the scheme, households earning up to €47,500 net income will be able to avail of subsidised child care and I hope future budgets will enable me to increase this threshold year on year.

At the same time, I am aware that child care is at its most expensive for children under three years of age. This is a prime reason the second element of the new scheme is a universal measure to all families with children under three years. Funding of €7 million has been made available to provide a universal subsidy for children in that age range availing of formal child care. From September 2017, a universal subsidy of up to €80 per month will provided towards child care costs. This equates to more than €900 per annum for parents working full time and will be paid on a pro ratabasis. The programme for Government commits to the introduction of a robust model for subsidised, high quality child care for children aged from nine months to 36 months.Currently, paid paternity leave in Ireland extends to 26 weeks - or about six months - but the programme for Government commits to further increasing paid parental leave in the first year of life and I certainly will be in favour of promoting that. It is my hope therefore that Ireland will get to this point sooner rather than later but until we do, the affordable child care scheme will be available from six months of age. This approach recognises that the cost of child care can push many parents out of the labour market when paid leave ends. Indeed the gap between the end of paid leave and the start of an entitlement to early care and education is an international indicator used to examine national policies in this area. The single affordable child care scheme does not amount to discrimination against stay-at-home parents. This is a scheme to support children. It aims to make child care more affordable for all families, giving all families more choice. The Government directly supports stay-at-home parents through the home carer tax credit, which has been increased to €1,100 per year. I support an increase in the earnings threshold for this and I have already spoken to the Minister for Finance about it. A priority for my Department has been to address child poverty through further education and labour market activation. That priority was established through feedback to politicians on the doorsteps and from the European Commission which gave Ireland recommendations - for two years in a row - to make high-quality child care more affordable and accessible. This new scheme is not an answer to all our parenting and family support needs but it does make high-quality child care more affordable. It is just a first step.

In 2017 the expected number of children who will benefit from the new single affordable child care scheme is estimated at 79,000. This includes 25,000 children who will benefit from the universal subsidy. An estimated 54,000 children will benefit from the targeted subsidies, including 31,500 children who already receive support under the current targeted schemes and 22,500 new beneficiaries. The scheme will be open to all child care providers who are registered with Tusla initially, including both centre-based child care providers and childminders. It is important for children and families that, if the State is subsidising child care, it subsidises services that have been quality assured. Currently Tusla quality assures child care services for my Department and over 4,500 services are already registered with Tusla. Only a small percentage of childminders are registered with Tusla currently, or eligible to register. More could be registered and I hope that more of those eligible for registration will do so over the next few months. I am currently working with Childminding Ireland to explore how a far greater proportion of childminders could be quality assured in order to access State funding under this scheme. Options to be explored will include a system of non-statutory quality assurance, possibly leading to statutory registration in the medium to long term.

The issue of capacity in the child care sector is complex also. Supply can depend on demand as well as the costs - including rents and staff wages, which need to be set at realistic levels that value the work of child care professionals. Demand for child care in turn depends on parental choice, among other factors. My Department has experience in assisting the sector with successful expansion - going back to its foundation and before - with the capital grants of the early 2000s that produced some excellent facilities that are still in daily use. This past year we focused on the expansion of the free pre-school scheme, which is now under way. My Department projects that the expanded early childhood care and education, ECCE, scheme will have a peak enrolment of 127,000 children in the April to June session in 2017. This is an increase of 60,000 children from the pre-expansion volume. Again, let me assure Senators that despite some media controversy, the timeline on this was not missed. The measure was announced in budget 2016 by Senator James Reilly and delivered this September on schedule. I commend the early years sector on responding to this expansion by creating capacity. As of this week, I understand there are more than 86,000 children registered in ECCE services, up almost 20,000 children on this time last year. It is too easy to always move to the next development but it is right that I should acknowledge the tireless work of my predecessor, who did so much under those very difficult circumstances of the past.As a result of this expansion, parents will benefit from an average of 61 weeks of free preschool provision for their children, thereby saving an average of €4,000 on child care costs for each eligible child. Budget 2017 also enables full roll-out of the access and inclusion model, AIM, to support children with disabilities to attend mainstream preschools.

In anticipation of the increased demand for places on the early childhood care and education scheme for 2016-17 and to support the sector to meet its capacity needs, I have introduced a number of measures to assist early years providers. For example, I provided a €2.5 million increase in capital funding for early years services seeking to increase capacity, thereby making available a total of €6.5 million in 2016 and allowing all applications that met the criteria for grant funding to be approved. The capital scheme has already provided several thousand new places and this number will increase as works are completed.

Supply of child care also depends on the availability of qualified staff and sufficient funding to pay them a fair wage. I am providing targeted learner funds to enable child care workers to attain recognised qualifications. In addition, I have widened access to the higher rate of ECCE capitation for the 2016-17 preschool year. That capitation rate is now set at €75 per child per week, with standard capitation set at €64.50 per child per week This restoration of rates follows the cuts that were applied in recent years. My Department has worked closely in recent months with child care committees across the country to analyse demand for places on a geographic basis, identify any shortages in provision and work intensively with services in areas where shortfalls might have been expected to occur. I am delighted the sector was able to meet all capacity demands for this September and is expected to meet demand in January for the next intake to ECCE. I thank the 30 city and county child care committees that helped my Department to assess demand and supply - a very complicated task - for the expanded ECCE programme. I look forward to working with them again in the coming years as we seek to increase capacity further to meet the increased demand we anticipate will occur because of the new scheme. I hope to be able to incentivise the sector to create new capacity through a number of measures. For instance, I am considering how the capital funding available to me in 2017 can best be invested. I welcome Senators' views in this regard.

I have focused my remarks on the child care sector. I will conclude by referring briefly to several other areas of work. I attach a very high priority to the work of Tusla, the Child and Family Agency, which provides essential services to some of the most vulnerable children and families in our society. I have secured an additional €37 million to allow the agency to continue its ambitious programme of reforming its services and building an effective and responsive child protection and welfare system. Later this week, I will outline details of an extra €5.5 million for youth projects across the country. There is also increased funding to enable the Office of the Ombudsman for Children and the Adoption Authority of Ireland to fulfil their operational roles and statutory duties.

I look forward to hearing Senators' contributions, which will help to inform the future direction of services to support children, young people and their families. I thank Members for their attention.