Crèches ‘need €2,500 per child’ for adequate care

THE ONLY way that crèches can be made affordable is if childcare providers are given annual subsidies of €2,500 for each child and parents are granted means-tested tax relief, according to the National Crèche and Nurseries Association.

In its pre-budget submission, the NCNA warned that affordability should not be at the expense of quality and it estimated that it costs €264 a week to give a child full-time quality care.

Their letter to the Department of Finance calls for crèche fees to be charged on a sliding fee scale depending on income, with the balance paid by the Government.

It also says childcare fees while parents are at work, in education or training should be a deductible tax credit allowable expense and maternity and parental leave should be extended to a year. At present, paid maternity leave is 18 weeks with an optional eight weeks unpaid.

The NCNA is calling for a National Childcare Contingency Fund for special case parents, such as students, who can’t afford private childcare but find themselves unable to access reduced-cost care. The NCNA says its research has shown the average childcare worker earns about €17,643 and so they are calling for the first €6,000 earned by childcare providers and childcare staff to be tax-free.

It also argues that childcare facilities should be exempt from rates as an infrastructural facility and early childhood care and education services should be zero-rated for VAT so they could continue to not charge VAT for their services but claim back VAT from their expenditure.

NCNA spokeswoman Martina Murphy said it was incorrect to argue that increasing the supply of childcare will result in less charges to parents.

“This is an economic myth. In order to fully understand the economics of childcare provision it is necessary to look at the factors, particularly the cost drivers, involved. Due to legislation, child-to-carer ratios and agreed best practice standards, normal economies of scale don’t apply within the childcare sector. Any reductions in fees to parents without a corresponding increase in external support, is likely to result in compromising on quality of service to children.”

The NCNA has warned that the childcare sector is by its nature labour-intensive due to child/carer ratios and that staff costs alone can account for 65%-75% of crèche fees.