Darren O'Rourke (Meath East, Sinn Fein)
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1321. To ask the Minister for Children, Equality, Disability, Integration and Youth the estimated cost of increasing the threshold for the maximum subsidy under the national childcare scheme from €26,000 to €35,000 annual income on a full-year basis. [18251/23]

Roderic O'Gorman (Dublin West, Green Party)
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At Budget time I allocated a total of €358 million under the National Childcare Scheme (NCS) for 2023. This figure is based on an additional €121 million being made available as a result of the estimated full year costs of a number of amendments to the Scheme:

The removal of the practice of deducting hours spent in school pre-school or school from overall NCS hours reward as of May 2022.

The increase in the upper age eligibility for the NCS universal subsidy from 3 years to all children under 15 years as of August 2022. 

An increase in the NCS minimum subsidy from €0.50 to €1.40 as of 2nd January 2023.

Given the recent nature of these changes, full year data is not available on claimants under the Scheme on which to provide an exact cost for the Deputy's proposed change. 

Using the ESRI SWITCH model, my officials have been able to simulate an increase in the threshold for the maximum subsidy under the NCS from €26,000 to €35,000 annual income on a full-year basis, which results in an approximate increase of 5.8% to the full year cost of the NCS. 

Applying this rate of increase to current expenditure estimates for 2023, the cost of increase is estimated to be approximately €21m.

This estimate comes with a number of caveats. The ultimate impact of the changes from Budget 23 are yet to fully realised and as such extensions to the scheme are based on estimates. In addition these costing are on the basis of a static system; that is, the model assumes that the level of usage of eligible early learning and childcare remains static. Any changes to subsidies may create a change in behaviours in families, for example, women returning to workforce and using formal early and childcare for the first time.