Wednesday, 30 April 2008
Seanad Eireann Debate
Senator Nicky McFadden: I am glad the Minister of State with responsibility for children is present to listen to this motion. I want to acknowledge his presence recently in Longford-Westmeath, where we did a tour of the very fine capital projects. In that context, the sum of money being spent on child care is to be commended.
I have tabled this motion on the Adjournment because of the confusion and insecurity surrounding the new scheme announced last July. The Minister of State undertook a review of the scheme and parents were required to detail very personal information concerning their incomes. These data were gathered by child care providers and forward to the Minister of State’s office in November and December last year. The Minister of State identified in the review that a tiered fee scheme was not being applied universally.
However, I cannot see that the introduction of the band tiered system will ensure fairness. For instance, many parents in employment in receipt of a modest income and not in receipt of social welfare will be excluded from subvention as a result. They will be required to pay substantially higher weekly fees for the use of not-for-profit child care facilities. I know the new scheme will provide for additional funding for crèches and after-school projects in severely disadvantaged areas. However, I believe it is not healthy for children to be socially excluded and segregated from those who are financially better off.
The other issue affecting crèches and after-school care is the difficulty for small community groups attached to a national school or housing estate in a community centre in being obliged to form a limited company. This is next to near impossible. Are the members of school boards of management expected to become company directors, for example?
There is also the question of cost and the lack of wherewithal to produce audited accounts. As a former member of a community group, I can attest that quarterly accounts had to be presented to Pobal showing, for instance, how the money was spent, how many staff there were and the number of children benefiting from the various schemes. Pobal had to be satisfied that there was value for money. It is now 30 April and the transitional period between the equal opportunities child care programme and the community child care subvention scheme is over because it will be July in two months’ time. I understand the impact of the new scheme is being monitored from January to July 2008.
Will the Minister of State state the result of the close monitoring? Community child care facilities throughout the country are waiting anxiously to know precisely what their budget will be for the coming year. Will the Minister of State say when the providers be notified of their allocation? It is very difficult and most unfair to expect efficient organised providers to plan ahead for staff, etc. for the coming year without knowing their budget.
I am also very concerned that under the new scheme the grant level will be reduced to 75% by 2010. This could mean a reduction of two staff members and a reduction in services. As it is, the people who work in this area providing a very valuable service are paid dismally — as little as €11 per hour. They must now endure the insecurity of not knowing whether their jobs still exist. Urgent clarification is needed before the community childcare subvention scheme is operated.
Deputy Brendan Smith: I thank the Senator for raising this issue. The main supports the Government makes available to parents to assist them with their child care costs are child benefit and the early childcare supplement. The latter payment, which is in recognition of the higher child care costs of pre-school children, is the responsibility of my office, and it alone amounts to expenditure of some €500 million in a full year. These payments are universal and benefit all parents, regardless of their income, labour market status or the type of child care they choose. In addition to these universal supports, Government child care policy has also recognised the need to target additional supports towards disadvantaged families.
Under the equal opportunities childcare programme 2000 — 2006, which was co-funded under the European Union Social Fund, with 40% coming from Europe and 60% from the Exchequer, targeted support was provided through the staffing support grant scheme. The equal opportunities childcare programme was extremely successful in its stated aim of creating new child care places. With more than 40,000 new places it considerably exceeded its original target of 33,500. Community-based not-for-profit child care providers with a strong focus on disadvantage were awarded grant aid towards their staffing costs to allow them to operate reduced fees to disadvantaged parents. Funding under this scheme was originally awarded for a limited period during which services were expected to move towards sustainability. This funding was subsequently continued to the end of 2007, where it was considered necessary to enable services to remain accessible to disadvantaged parents and people on lower incomes. This continuation funding was subject to the condition that tiered-fee structures were implemented by the services in question.
The national childcare investment programme 2006-2010 has a funding allocation of €575 million and aims to create an additional 50,000 new child care places. It is expected that approximately 22,000 of these places will be in the private sector and 28,000 in the community not-for-profit sector. Some 20% of the places will be for children in the three to four age group and will provide an early childhood care and education focus.
The child care programmes — the current national childcare investment programme and the equal opportunities childcare programme which ran from 2000 to 2006 — have a combined budget of more than €1 billion, and are projected to create or support more than 90,000 child care places. Part of this investment includes the new community childcare subvention scheme 2008 — 2010. Funding amounting to €154.2 million is being allocated to the new scheme over the next three years, a significant increase over the €37 million 2007 funding allocation for the support scheme under the equal opportunities childcare programme. That is clear evidence that I have more money available to me in each of the years than I had in the 2007 scheme. We have been rolling out the capital aspect of that scheme and we are ahead of target in the creation of child care places under that programme. Approximately two months ago I had the opportunity to approve a number of major projects throughout the country and in the next week or so I will also approve other projects.
Both my staff and I were keenly aware of concerns that were prevalent among the community childcare sector and parents using those services when the new childcare subvention scheme was announced. At the outset, I stated that the scheme would be monitored closely to ensure the best outcomes for child care services and I would use the data provided by the applications process to ensure this would be done. I kept my word. My officials analysed the information we received and on 18 December 2007 I was delighted to announce the Government’s decision to finalise the scheme to assist more children and families. In this House I said that our target was to have the scheme finalised by Easter — before the end of March. We reached our target in finalising the new scheme three months ahead of schedule.
The final scheme includes a number of key changes. The subvention for band A parents — those in receipt of social welfare related payments — has been increased from €80 to €100 per week. The subvention in respect of band B parents — those in receipt of family income supplement or certain child care subsidies, for example under FÁS or VEC schemes — has been increased from €30 to €70 per week. Services will also be grant aided to provide reduced child care fees for parents who are marginally above the family income supplement threshold. Low-income parents in band C are expected to benefit by €45 per week. There will be a tapered withdrawal of the subvention when parents move from welfare to work. A minimum grant level of €20,000 per annum has been also introduced to support services which would only receive low levels of funding through the subvention scheme, provided they meet the general requirements of the scheme. For example, small rural services could become unviable without such adjustments. In the meantime, the transitional arrangements have been put in place to facilitate existing equal opportunities childcare programme grant recipients to adapt during 2008. In many rural areas that I have visited in recent months, there was a particular welcome for the minimum amount of €20,000 to facilitate the smaller projects — perhaps a facility in an isolated area with a small population — which will ensure their viability.
My office is processing the individual levels of funding for groups in respect of the second half of this year and writing to them to inform them of these amounts. It is expected that this will be completed in the first half of next month — within the next 15 days. Services have been guaranteed that they will receive at least 90% of their current funding levels in the second half of this year and not less than 85% in 2009. In effect the combination of transitional funding and the July to December payments, which are currently being notified to providers who meet the criteria, will mean that no service in receipt of funding will see payments fall below 95% of the current levels for 2008.
The community crèches, which account for approximately 20% of the service providers nationally, are central and valuable players in providing quality child care at prices which are affordable for all, including the most disadvantaged in our society. The new scheme will continue to recognise and support the valuable investment in the community not-for-profit sector and ensure the tiered fees necessary to make this a reality.
My office will closely monitor the scheme between 2008 and 2010, assisted by both Pobal and the city and county child care committees. The national child care investment programme, of which the child care subvention scheme is a part, has been allocated €575 million over the next three years and is on target to create 50,000 additional child care places, with a greater focus on pre-school places for three to four year olds and school-age child care. As I stated previously in this House, the Government was never going to walk away from an investment in child care of more than €1.1 billion up to 2010. Our resolve is firm and our commitment to quality child care for families and children is as strong as ever.
I am very familiar with the community child care providers throughout the country. Senators McFadden and Glynn will be well aware of the great effort and commitment by so many committees throughout the country to put in place facilities and access the funding from my office. They have worked very hard to provide services and places where it would not be possible for a private provider to play such a part. The Government is determined to work with the community child care providers and ensure that families in those areas derive the best possible benefit from the major financial investment that has been made by the taxpayer and by Europe in the earlier scheme, and from the investment of time, effort and commitment by individuals.
I had the opportunity to visit Longford and Westmeath on a number of occasions during the short time I have been in this office. I was in Athlone on a number of occasions. I had the opportunity to perform the official opening of the new community facility in Ballinacargy. I was very glad Senator McFadden was able to accompany me throughout County Longford. We started in Longford town and went to Kenagh, Legan, Ballymahon, Edgeworthstown and Granard. That day I saw at first hand the great work that is going on. One of the councillors in Longford that day, along with Deputy Peter Kelly, invited me to go back and tour the private providers’ facilities. I hope to do that before the end of the summer. I know that Senator Glynn has arranged with my office to perform the official opening of another facility in County Westmeath. I hope to be back in the good county of Westmeath in the next three to four weeks and I thank Senator McFadden for raising this issue.
Senator Nicky McFadden: I also raised points on how difficult it is for small providers to form limited companies and the cost of audited accounts, which are necessary. Can the Minister of State comment on these matters?
Deputy Brendan Smith: As Senator McFadden knows, when dealing with public money we must ensure different processes are followed. I know there can be a considerable financial burden when finalising accounts and having audits done. When using public money, the onus is on the Houses of the Oireachtas and statutory agencies to ensure the best possible information is derived.
I am not familiar with the matter of establishing companies. Pobal administers the scheme on our behalf at local level but I will see if there is a template for establishing companies that helps minimise the costs involved so that the local group can fill out the form themselves.
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