Despite a range of schemes the Government has introduced, including some free pre-school places, the European Commission said there was no evidence these are helping the situation.
The cost of childcare in Ireland is far above the EU average, taking up 40% of the average wage compared to 12% in Europe.
A report by the commission, designed to guide the Government’s budget for 2015, said: “The limited availability of childcare benefits means that parents bear almost the entire cost directly, unlike most other EU countries, where childcare benefits are significant.”
This makes it difficult for women and single parents in particular to get a job and leaves them without prospects to improve their situation, according to the report.
Employment Commissioner Laszlo Andor said child poverty was of specific concern in Ireland and Britain, along with inequality, poverty, and social inclusion.
The report is also critical of people losing their medical card and rent allowances when they get a job, making the long-term unemployed, who may have low skills, less inclined to take up work.
Changes to the social welfare system, whereby payments can be cut off for up to nine weeks for refusing to take a job offer or take part in a training course, were welcomed.
Fianna Fáil finance spokesman Michael McGrath was critical of the rate of job creation. “The CSO employment data shows that the much talked about 1,000 extra jobs a week has slowed to little more than 1,000 jobs a quarter,” he said.
“We have lost 5,000 jobs in the retail sector in the last three months and the domestic economy remains on the floor.”
Mr McGrath added that little action on mortgage arrears, increased health spending on agency staff, and the loss of medical cards were leading to an acute sense of frustration among the public.
The commission’s report notes that the number of people in Ireland with jobs but suffering from poverty and deprivation has increased, and it blames this on them having part-time jobs when they want and need full time work.
Economics Commissioner Olli Rehn said the report reflects the fact that many of the actions in Ireland’s austerity programme are ongoing but need to be ended.
Apart from reforming the health service, the report also says legal services costs remain high and affect the cost structure of all business, including SMEs.
The cost of enforcing contracts was close to 27% of the claim, according to the World Bank, more than five percentage points above the EU average and 12 higher than top performers such as Germany. Lawyers’ fees represent the majority of this cost at close to 19%.
The report also dealt with the need for more finance and credit for SMEs, and the need for SMEs to take up the funds that have been made available.