Thousands of parents who benefit from government subsidies to lower the cost of early education and childcare might lose up to €1,600 in additional funds expected from September due to concurrent price hikes. In recent official papers shared with over 4,000 crèches and other institutions involved in the early education and childcare subsidy scheme, the Department of Children informed providers that if their charges were below the average county rates, they could request to increase their fees starting September 1st.
The maximum allowed uplift is €33.30 weekly, equating to roughly €135 monthly per child for 45 hours of care weekly. This is the identical maximum surge forecasted for universal allotments under the National Childcare Scheme. Consequently, numerous working parents relying on currently less costly crèches might witness potential reductions in childcare expenses being absorbed by these fee hikes.
The present average costs noted in the documents fluctuate per county, with Dún Laoghaire-Rathdown being the priciest at €264.02 for five full days. With an average of €151.71, Leitrim is the least costly on average. Other high-priced locations lie in or near Dublin, with typical prices for full-day care in Fingal, Dublin city, South Dublin and Wicklow council jurisdictions amounting to roughly €1,000 monthly.
The approvals for fee rises is the department’s approach to address grievances from some providers who were operating with pricing structures dating as far back as 2017. They have been unable to increase these rates due to obligations tied to the state’s early learning and childcare funding programme.
This year, the scheme has a total budget of €1.1 billion and come September, it will offer providers more funding towards staffing, administration and other miscellaneous costs.
The range of increases expected to be allocated to providers under numerous complex funding channels differs significantly.
Certain providers have withdrawn from the primary funding programme with the intention of freely raising their prices, reveals Childhood Services Ireland (CSI), a representative body. Conversely, the department noticed an uptick in the number of service providers in the second year of the programme, with registration for the third year currently in progress.
Stephanie Roy, CSI’s director, opines that the permitted fee hikes are insufficient considering the escalating costs providers have had to grapple with in recent times, particularly in services where fees remained static before providers opted for funding. She further lamented the ambiguity surrounding the criteria for authorising fee hikes.
Roy emphasises that, “Providers must register for the ensuing year prior to submitting an application for a fee increase, and there ought to be a provable necessity for the hike. However, the department’s method of determining this need is ambiguous.”
She adds, “Any business sector requires a degree of certainty, and this one is critically crucial for children’s social and developmental needs, as well as for their parents’ economic participation. The existence of a process to increase fees is beneficial, but the optimum increase will still not restore providers to 2024 market rates.”
Last week, Minister for Children Roderic O’Gorman confirmed a 15% increase, amounting to €44 million, to the core funding programme, along with extra expenditure to increase capacity.
The department stated that when a fee increase is sanctioned, subsidies from the National Childcare Scheme will ensure parents and guardians don’t feel the increase in personal costs.
Details on the mechanism for increasing fees will be divulged in the next few weeks, according to the department.