Seán Sherlock (Cork East, Labour)
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Question 432: To ask the Minister for Health and Children her views on making funding available toward the cost of childcare for working parents in view of the increasing cost of living here resulting from rising food prices, house prices and so on; and if she will make a statement on the matter. [12237/08]

Mary Harney (Dublin Mid West, Progressive Democrats)
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The main supports the Government makes available to parents to assist them with their childcare costs are Child Benefit and the Early Childcare Supplement (ECS). The latter payment is the responsibility of my Office, and it alone is expected to amount to expenditure of over €500m in 2008. The ECS increased from €1,000 per annum to €1,100 per annum in the December 2007 Budget. Both payments are universal and benefit all parents, regardless of their income, labour market status or the type of childcare they choose.

Furthermore, Government childcare policy has recognised the need to target additional supports towards disadvantaged families in addition to Child Benefit and the Early Childcare Supplement which are made to assist parents with their childcare costs. These additional supports are provided by the National Childcare Investment Programme 2006-2010 (NCIP) which will invest €575 million over 5 years in developing childcare services.

The NCIP came into effect in January 2006 and aims to provide a proactive response to the development of quality childcare supports and services, which are grounded in an understanding of local needs. It is building on the success of the Equal Opportunities Childcare Programme 2000-2006 (EOCP) and has a target of creating 50,000 new childcare places, supported by capital grant aid. Services eligible for support include those providing care for babies, full-day care, part-time, sessional playschool and other pre-school places, school age childcare including "wrap around" childcare places, and childminding. Special consideration is given to supporting services which provide a range of these services.

The NCIP provides for the Community Childcare Subvention Scheme (CCSS) which was introduced in January of this year. The CCSS has an allocation of €154.2 million over 2008-2010 and provides an effective framework for targeting of additional resources towards disadvantaged parents and their children while continuing to support community-based childcare services generally. This is a significant increase above the allocation under the preceding scheme, the EOCP Staffing Grant Scheme, which amounted to €37m in 2007. The level of grant aid which individual services qualify for will reflect the level of service they provide and the profile of the parents benefiting from their service. The subvention received by services is, in turn, reflected in reduced fees for parents who qualify as disadvantaged under the Scheme.

Transitional arrangements have been put in place to facilitate services which were funded under the previous EOCP support scheme to adjust to the new arrangements. As a result, these services will receive not less than 95% of their previous level of funding in 2008. The Scheme recognises that in some cases, particularly in rural areas or on the islands, community-based childcare services may cater for small or fluctuating numbers of children, in which case a minimum annual grant level of €20,000 can be awarded.

In practice, this will mean that parents with children in such services and in receipt of most social welfare payments (or participating in a scheme such as Community Employment which demonstrates an underlying entitlement to same) or parents in receipt of Family Income Supplement (FIS), will have a weekly subvention paid to the service in respect of their child. Each service will also receive a tranche of funding to subvent the costs of low income working families with incomes above the FIS threshold. A higher subvention will be paid where the subvented child is a baby, in recognition of the higher costs associated with the care of children aged under 1 year. The tiered fee structure is the most effective way of ensuring that the considerable and ongoing Government support for the community childcare sector, will be targeted at families who need it most. It should also be noted that the cost of community not-for-profit services that have availed of capital grant aid under the EOCP or NCIP, thus removing the requirement to cover rent or a mortgage, and which are run on a not-for-profit basis, should be significantly below the market price.

It is considered that this combined approach of universal benefits and targeted subvention is the optimal method of distributing Exchequer funds and ensuring the most affordable childcare is available to families according to their means.