Anne Rabbitte (Galway East, Fianna Fail)
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261. To ask the Minister for Children and Youth Affairs if she has conducted an economic analysis on the potential impact of the single affordable child care scheme on child care prices; and if she will make a statement on the matter. [22427/17]

Katherine Zappone (Dublin South West, Independent)
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The policy paper on the Affordable Childcare Scheme (ACS), which the Government approved last October included a preliminary economic analysis of childcare provision in Ireland. The policy paper examined the option of imposing price-caps on childcare providers to prevent erosion of subsidies through fee-inflation. The policy paper noted the potential benefits of price-caps, including preventing fee-inflation and providing certainty for parents, and equity between parents. It did however note the problems that might arise. Introduction of price-caps would represent economic regulation of the market, raising legal questions as well as economic questions as to what constitutes a fair price for childcare.

The policy paper recommended that there should be no initial price-cap, but that the option of price-caps should be considered following the Independent Review of Costs and examination of the initial market response to higher subsidies. The Independent Review, which will be commissioned later this year, will include examination of variation in costs and fees. It will be a key input into any future consideration of the potential benefits and risks of introducing price-caps.

Anne Rabbitte (Galway East, Fianna Fail)
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262. To ask the Minister for Children and Youth Affairs the steps she will take to ensure the financial viability and affordability of the child care sector in addition to the single affordable child care scheme. [22428/17]

Katherine Zappone (Dublin South West, Independent)
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The Affordable Childcare Scheme will replace all the existing targeted childcare schemes. When it is introduced, two schemes will then be in operation to support the affordability of childcare and early education: the Affordable Childcare Scheme, and the ECCE free pre-school programme, which will continue to provide 15 hours of free early education each week during term-times for children from the age of 3 until they start primary school.

The Independent Review of the Cost of Quality Childcare, which will be commissioned later this year, will include consideration of factors that impact on the financial viability of the childcare sector. While the precise scope and methodolody of the Independent Review is still to be confirmed, the Review is likely to examine issues such as:

- the total average cost of provision;

- costs and revenues for services operating in disadvantaged communities, including the range of service provided by such services and sustainability issues and

- the likely impact of future cost-pressures. This will inform future policy development and Estimate processes.

In the longer term, the question of sustainability must be addressed comprehensively, and at the core of this is working with community services to develop adequate funding streams and business models. The Deputy will be aware that I have recently announced a significant expansion and extension of the funding available under the Community Childcare Subvention from September of this year; which I anticipate will be of significant assistance to services. In addition arrangements are progressing for the provision of 'non-contact time' funding to services this summer, representing an additional seven days' payment to each service, for which I secured €14.5m in Budget 2017. I will be seeking to retain this funding in 2018 and am examining integrating this into the capitation rates paid to services. I will also be examining how the €1m sustainability funding provided for 2017 can be used in 2018, and I will be working with the sector and stakeholders in this endeavour.