Fee cap threat for childcare providers

The children’s minister has threatened to enforce a fee cap on childcare providers if they abuse the affordable childcare scheme.

The universal government subsidy — which amounts to up to €20 per week in support — came into force yesterday.

However, there are some concerns that creches and childcare facilities have been using the administration work involved in the scheme as an excuse to increase rates.

While the Government hopes that the parents of up to 70,000 children will be able to avail of the affordable childcare scheme, around a quarter of all childcare providers registered with Tusla have not signed up.

Ms Zappone said the roll-out of scheme marks the first big step towards delivering accessible affordable quality childcare, but added that she would be keeping a close eye on providers to ensure they simply do not increase prices in line with the extra supports.

She said: “If I find that there is a pattern throughout the country where providers are taking a significant amount of the subsides — which are intended largely to support families — and they can’t demonstrate that that has a relation to cost then I will take action.

“The action would have to do with some sort of regulation that is tied to their use of the Government scheme or some sort of price cap.

“I don’t want to have to do that,” she said, adding that she hoped she could gain the co-operation of childcare providers.

But Labour spokesperson on Children and Youth Affairs Seán Sherlock said the value of the new universal subsidy is being “eroded or lost completely” for parents and blamed the Government for not implementing a cap on childcare costs.

He said: “For many parents, the extra subsidy will simply go towards meeting the increased fees many crèches have introduced.

“Needless to say this has caused great distress as families now cannot look forward to their anticipated savings on their childcare bill.

“The horse has bolted, but with price increases already in effect the Minister for Children is now belatedly calling for restraint and considering regulation or price caps.”

Meanwhile the Iona Institute said the universal childcare scheme discriminated against parents who decide to have their children looked after in the home, as it is only open to Tusla-registered childcare providers such as creches.

“The only way for the Government to make its policy fairer is to substantially increase the home-carer’s tax credit which was introduced in 1999 to partly offset the effects of tax individualisation, but which has been increased only very slightly since then,” David Quinn of The Iona Institute said.

“Otherwise we will have to conclude that the Government wants to discriminate against the clear majority of parents who mind their children at home or have a relative mind their children.”

A total of 2,805 of the 3,705 Tusla approved providers had signed up to the scheme as of yesterday.

All children aged between six months and three years of age are eligible to revive the universal support of up to €1,040 per year.