Brendan Griffin (Kerry, Fine Gael)
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1935. To ask the Minister for Children and Youth Affairs her views on the fact that child care providers are increasing prices before the introduction of the affordable childcare scheme; if measures can be put in place to prevent same; and if she will make a statement on the matter. [27943/17]

Katherine Zappone (Dublin South West, Independent)
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I am not anticipating widespread increases in childcare fees as a result of increases in subsidies this September. There is no evidence, at this point, of plans to increase fee-levels.

Fees charged to parents are entirely at the discretion of childcare providers who operate independently of the State. There are many factors that influence the fees charged, including a range of cost pressures and market forces. A childcare provider may raise its fees for one of many reasons, particularly where childcare fees have changed very little in recent years. While I do not expect a widespread increase in fees, my Department will actively monitor the trends over time.

The policy paper on the Affordable Childcare Scheme (ACS), which the Government approved last October, 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 and 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.

Estimates of take-up of September 2017 measures suggest that up to 70,000 children will benefit from the improvements I am making. The fact that so many children will benefit from subsidies this September is a very positive development and represents a significant precursor to the Affordable Childcare Scheme when even more families will benefit.