Parents looking to return to employment often face the barrier of childcare costs. According to the UNICEF report Where Do Rich Countries Stand on Childcare (linked HERE), childcare costs in Ireland are amongst the highest in the developed world, and can cost between a third, and half of a family’s salaries. Single parents, disproportionately women, are most severely affected by these costs.
According to Journal.ie reporting in 2019, the average cost of full-time childcare (for children between the ages of two and three) in Ireland was €184 per-child-per-week, with the lowest of €148 per-child-per-week being found in Carlow and the highest being found in Dublin at a cost of €251 per-child-per-week. These costs can prove prohibitive for single parents, minimum wage earners, and even well-paid households who have a number of young children.
As it stands, the minimum wage in Ireland is €10.20 per hour, which means someone working a 39-paid-hours-per-week job can expect to earn €397.80 before tax. If childcare costs for one child is subtracted, a minimum wage earner would be left with €213.80 before tax. While minimum-hour and zero-hour contracts that result in uncertain weekly income make it hard to cover weekly costs. Young parents face even greater challenges as the minimum wage for under 18’s, 18-year-olds, and 19-year-olds are set at 70%, 80%, and 90% of the base rate respectively.
In 2019, to address the issue of prohibitive childcare costs the government launched the National Childcare Scheme (NCS) and the Early Childhood Care and Education Scheme (ECCE) to replace a number of older schemes which were phased out in 2020. While these schemes do offer some amount of relief, they are not perfect. The NCS has two bands, means-tested and non-means-tested. Non-means-tested only supplies a small subsidy to parents, while the means-tested subsidy is available for households earning less than €60,000, and is granted on a scale depending on a household’s resources. At no point does the means-tested subsidy provide full coverage. The ECCE is limited to specific childcare centres, and as such only has a limited number of places. Another issue with the ECCE is that it can only be entered into in September which means that places which become available during the year cannot be filled. While parents facing a change in circumstances may have to wait long periods of time before availing of the scheme.
In the SIPTU report A New Model of Early Childhood Education and Care (linked HERE), released as part of the #NewDealForEarlyYears campaign,two major factors were outlined for the high costs of childcare. The first is the reliance on a market model, which is underpinned by the profit motive and raises issues of affordability. The second, which was also touched upon in the UNICEF report, is government underfunding. The Irish government invest only 0.3% of GDP into childcare which is less than half the EU average of 0.7%.
To increase ease of access to childcare, the SIPTU report recommended that the government take on the payment of childcare staff to reduce the running costs for childcare operators, and setting a rate of between €40-60 for childcare, while providing household subsidies similar to the NCS, to grant free childcare to low-income earners. They calculate that this would cost the state €425 million but would be heavily offset by the ending of overlapping programmes such as the National Childcare Scheme.
The SIPTU proposal would have the advantage of providing greater financial relief to parents overall, should simplify childcare schemes, and standardise pay for carers. There is currently a 40% turnover rate amongst carers, with 60% of carers earning below the living wage. Better and standardised pay across the childcare industry could be crucial to staff retention.
For more information on the childcare supports please read page 152 of the Working for Work Report linked HERE, or visit the citizens information pages on the NCS (linked HERE) and ECCE schemes (linked HERE).