Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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181. To ask the Minister for Children, Equality, Disability, Integration and Youth if his attention has been drawn to the spiralling costs of childcare in particular in the Dublin 8 area in which parents are being faced by a €200 or 20% increase by some service providers without explanation; and if he will make a statement on the matter. [32194/21]

Roderic O'Gorman (Dublin West, Green Party)
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I am very concerned to hear of any individual provider proposing to increase charges to parents at a time when the Government continues to support early learning and childcare providers very significantly. In view of the extent of State support, increases are not justified at this time.

One of my key priorities in Government is to achieve affordability of early learning and care and school age childcare. The Programme for Government commits to substantially reducing fees to parents while supporting quality service provision. The Government has been strongly supportive of the sector, particularly since the onset of Covid-19. We have provided substantial additional supports to allow services to operate sustainably throughout the pandemic, acknowledging that there are higher delivery costs and many extra practical and financial challenges to be met. One of the objectives of these supports was to ensure that the higher delivery costs due to public health requirements and lower occupancy were not passed on to parents.

In addition to my Department's funding schemes, all services can currently participate in the Employment Wage Subsidy Scheme (EWSS) which provides an average of 50% of normal operating costs for services, at a value of some €35m to the sector each month. The EWSS has been paid at enhanced rates since October 2020, and is due to continue until the end of December 2021. Most businesses must demonstrate a 30% reduction in turnover to be eligible for supports under the scheme. When the EWSS was introduced in August 2020, I negotiated a special arrangement for registered ELC and SAC services to be exempt from this turnover test and I can confirm that these special arrangements will be extended for Quarter 3 of 2021. Officials in my Department are engaging with the Department of Finance in the context of wider proposals for the EWSS in Quarter 4.

I recognise that early learning and care and school age childcare services are private businesses and are free to set their own policies regarding the charging of fees and contract conditions and I am aware that there are service providers notifying parents of a future significant increase in fees. Given the substantial additional supports allocated to the sector, and the assurance that there will be no sudden withdrawal of Government supports, there is no case for an increase to fees paid by parents.

I might add that where providers require further financial assistance in addition to current supports available, my Department operates a Covid-19 Impact Support Scheme. I would urge providers to apply for funding under this Scheme before taking steps to increase fees charged.

For parents who might wish to find an alternative provider, there are 30 City/County Childcare Committees around the country who can assist in identifying services in their areas. Information on these is available at myccc.ie. Information on services registered with Tusla, including contact details and inspection reports, is available on Tusla's website.

There are a number of measures in place to ensure affordability for parents. Families may be entitled to subsidies under the National Childcare Scheme (NCS), which aims to improve outcomes for children, reduce poverty, facilitate labour activation, and tangibly reduce the cost of early learning and childcare for tens of thousands of families. The scheme comprises of two types of subsidies:

- A universal subsidy for children of pre-ECCE age who are availing of early learning and childcare services from an approved provider. The universal subsidy is not means-tested and is available to all qualifying families of any income level.

- An income-assessed subsidy is payable for children from 24 weeks to 15 years of age who are availing of early learning and childcare services from an approved provider. The level of subsidy is determined by the family's reckonable income.

NCS subsidies are awarded as an hourly rate for a maximum number of hours per week. Where parents are not engaged in work or study, the NCS subsidises up to 20 hours per week. Where parents are engaged in work or study, the NCS subsidises up to 45 hours per week. The definition of work or study is broad, covering all forms of work or study arrangements, and engagement in work or study for just 2 hours confers entitlement to higher maximum hours of subsidised provision. This makes the scheme as flexible as possible.

Looking to the future, my Department will be developing a new funding model for early learning and care and school age childcare that provides additional resourcing to services subject to quality and affordability. An Expert Group has been progressing this work since late 2019 and I expect their report to be finalised in November. An essential and top priority for this Group will be to make recommendations on a mechanism to control fee rates for different types of provision for ELC/SAC.

Extensive research has already been commissioned to inform the work of the Group. Frontier Economics, the Research Partner, have produced and published eight working papers, with three that directly address affordability issues including international comparisons of fees and public investment, approaches to funding the early learning and care sector, and mechanisms to control fees charged to parents. This research identifies international practice and learning that will be of value for the new funding model.

Aengus Ó Snodaigh (Dublin South Central, Sinn Fein)
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182. To ask the Minister for Children, Equality, Disability, Integration and Youth the steps he will take to regulate the pricing structure of the creche system and to address the fact that not all creches or childcare providers accept the national childcare scheme subsidy, the high cost of insurance facing the childcare industry, the low wages of those working in the childcare sector, the lack of creche spaces and long waiting lists in many areas including Dublin 8 and the shortage of places for children under one year. [32195/21]

Roderic O'Gorman (Dublin West, Green Party)
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One of my key priorities as Minister is to achieve affordability of quality early learning and care (ELC) and school age childcare (SAC) for families.

With regard to the question of the cost of childcare,the Programme for Government commits to substantially reducing fees to parents while supporting quality service provision. My Department has established an Expert Group which is currently carrying out a review of the funding model for ELC and SAC. This Group will report to me later this year, and its report will inform the development of a new funding model for ELC and SAC, which delivers affordable, quality provision of early learning and care to families.

My Department has provided substantial additional supports to allow ELC and SAC services to operate sustainably throughout the pandemic. One of the key objectives of these supports was to ensure that the potential higher delivery costs due to public health requirements and lower occupancy rates were not passed on to parents. Among these supports is the EWSS, which at enhanced rates, covers up to 80% of staff costs, or 50% of operating costs of services.

With regard to service providers engaging with the National Childcare Scheme (NCS),providers are private business and it is their choice to provide any of my Department's funding programmes, including the NCS.

However, I strongly encourage every provider to participate in the NCS, to enable parents to access the financial supports for early learning and childcare costs which are available to them through the NCS. In advance of the launch of the NCS, my Department provided a suite of supports to ELC and SAC providers including training, transition payments and a capital grant for ICT equipment, to assist with the administration of the NCS. These supporting measures were designed to encourage sign-up, support readiness and facilitate the smooth operation of the NCS.

My Department provides an annual programme support payment (PSP) to compensate providers for the time they have to devote to the administration of DCEDIY funding schemes, including the NCS. Training and support on registering for the NCS is available for providers from all City/County Childcare Committees (CCCs) and from Pobal, the scheme administrator.

At present, over 3,000 ELC and SAC providers are contracted to participate in the NCS. My Department will launch a communications campaign on the NCS in the next month, which will encourage more providers to sign up for the NCS, and also inform parents of the supports which they can receive under this scheme.

I do appreciate the difficulties caused when a parent’s preferred provider does not engage with the NCS. However, parents can access their NCS subsidy through any ELC and SAC provider which is registered to provide the NCS. Their CHICK number, which unlocks their subsidy award, can be used in any NCS-registered ELC and SAC service.

As the Deputy is aware, the DCEDIY funds a national network of City/County Childcare Committees (CCCs) to support and assist families and early learning and childcare providers . A parent’s local CCC will be in a position to provide them with information and assistance with locating a suitable service or childminder in their area that is participating in the NCS. Further information on CCCs can be found at www.myccc.ie.

With regard to the cost of insurance, I understand that there has been a slight increase in brokerage fees for the majority of ELC and SAC providers this year, but that there has not been a general increase in premiums for providers. I understand that insurance costs remain at an average of €60 per child per annum for full time providers.

Neither the Government or the Central Bank of Ireland can direct the pricing or provision of insurance products, as this is a commercial matter which individual companies assess on a case-by-case basis. This position is reinforced by the EU Single Market framework for insurance (the Solvency II Directive) which expressly prohibits Member States from doing so.

Notwithstanding this, insurance reform is a priority for this Government. The Action Plan for Insurance Reform, which was launched on 8 December 2020, contains a range of deliverables in a number of Government Department policy areas. It is intended that the cumulative effect of the implementation of the actions will be to improve the insurance environment, in particular for businesses. I am a member of the Sub-Group for Insurance Reform, chaired by An Tánaiste, which has been set up within the Cabinet Committee for Economic Recovery and Investment to implement these reforms – the sub-group will publish progress reports every six months.

Seeking to secure a more sustainable and competitive market through deepening and widening the supply of insurance in Ireland remains a key policy priority for this Government. In this regard, it is the Government’s intention to ensure that the implementation of the Action Plan can have a positive impact on the affordability and availability of insurance for individuals, businesses and voluntary groups, including ELC and SAC providers.

With regard to the pay of staff in early learning and childcare services, I am very conscious of the need for improvement in pay and working conditions in the sector.

As the State does not employ early learning and childcare practitioners, the Deputy will appreciate that my Department cannot set wage levels or determine working conditions for staff in the sector. My Department has, however, over a number of years provided a range of supports to service providers to enable them to improve wages and working conditions.

In December 2020, I began a process to examine the possibility of regulating the pay and conditions of employment of practitioners in early learning and childcare, and to examine the suitability of establishing a Joint Labour Committee (JLC) for the sector, in line with the Programme for Government commitment. On foot of this process, the Minister of State for Business, Employment and Retail has written to the Labour Court, who are currently examining whether to establish a JLC. If established, a JLC could lead to an Employment Regulation Order, which would establish binding rates of pay and conditions for the sector.

Work on the new funding model is relevant here. The recommendations of a dedicated Expert Group are due later in 2021 and will be central to addressing both affordability and quality issues. The Expert Group’s Draft Guiding Principles to underpin a new funding model recognise the importance of the workforce in delivering quality services.

Finally, work on the Workforce Development Plan continues, with final outputs expected by the end of the year. This is expected to include plans for making careers in early learning and childcare more attractive.

With regard to the to the availability of early learning and childcare places,my Department monitors the supply of, and demand for, ELC and SAC places annually through the Early Years Sector Profile report. This survey is conducted by Pobal on behalf of the Department.

Published data from the Sector Profile for the 2018/2019 programme year indicates that existing early learning and childcare provision, in general, meets current needs nationwide in terms of capacity whilst recognising that small pockets of under supply may exist within this.

Nationally the vacancy rate in 2018/19 was 6%, which was an increase from 5% in the previous year. Dublin City had a vacancy rate of 4% in 2018/2019, no change from 4% in 2017/2018.

Capacity data is not available for 2019/2020 owing to the impact of Covid-19 on supply and demand for services, however the nation network of CCCs have been working to monitor the availability of ELC and SAC places during Covid-19. I understand from their valuable work, and from engagements I have had with representatives of the early learning and childcare sector, that the pandemic as resulted in a reduction in demand for ELC and SAC places, in particular for after-school care.

With regard to the availability of places for babies, the Sector Profile shows that while there are vacancies in centre-based care for babies, they may not be available nationwide. The national network of CCCs can advise parents of the availability of centre-based care in their locality, and also of other options, such as childminders.

It is my intention to provide increased support to parents to enable them to have the choice of looking after their children at home up to the age of one. This commitment is set out in First 5, in the first Strategic Action 1.1: Facilitate mothers and fathers to care for their child at home during their first year. My Department is overseeing the introduction of a range of measures across Government to support this commitment.

My Department will continue to actively monitor supply and demand, and will continue to build on the progress achieved over the past decade in order to ensure that ELC and SAC services are accessible, affordable and high-quality, for all age ranges.