New national childcare scheme: 11 essential points you need to know

New system launches on Wednesday but low-income families on existing programmes will be allowed to remain on them indefinitely

Low-income families on existing childcare subsidy programmes will be allowed to remain on them "indefinitely", despite the online launch of the new National Childcare Scheme on Wednesday, November 20th.

A one-year, then a two-year, transition phase for such families had been announced but now the Department of Children and Youth Affairs is indicating they can wait until their children age out of the system, or their circumstances change.

It’s effectively an admission that the new scheme, covering children aged 24 weeks to 15 years, could be less favourable for some low-income families.

11 essential points to know about the new scheme

1) Online applications by parents for childcare subsidies for children aged between 24 weeks and 15 years open on from Wednesday, November 20th.
2) The parent making the application needs to have a verified MyGovID  (for which you must have a public services card) to apply online. There is no such requirement for paper-based applications by post but these will not be available until next January and there will be no backdating of subsidies.
3) When your online application is approved, you will receive a Chick code that your childcare provider needs to register the number of hours you are going to use. You will then receive an online notification asking you to confirm the details and, once that is done, the department will send the subsidy to the provider, who will reduce your bill accordingly.
4) Subsidies will only be paid for childcare costs at a centre (or childminder), which is both registered with Tusla and has a National Childcare Scheme contract. (Fewer than 100 childminders are registered with Tusla.)
5) The number of subsidised hours and rate of subsidy you are entitled to will depend on various factors, including family income, age of child and stage of education, and the work and/or training/education status of both parents.
6) All families with children under three, regardless of income, are entitled to 50 cent off the cost of every hour of childcare used – up to a maximum of 40 hours a week – that is, €20 a week.
7) Families with a "reckonable" income of under €60,000 will be entitled to a means-tested, sliding scale of subsidy, with the maximum rates payable for those with a reckonable income of under €26,000.
8) To calculate your "reckonable" income, you take your after-tax pay but can also make other deductions such as for multiple child credits (such as €4,300 for families with two children under 15), various social protection payments and any maintenance payments for a child or former spouse.
9) The two-year free preschool programme (also known as ECCE – the Early Childhood Care and Education programme) will not be affected by the new scheme.
10) However, the hours spent in ECCE, or in school, are deducted from the weekly hour allowance, which is why the new scheme is referred to as "wrap-around" care. So, for example, a parent of a child in first to sixth class in national school, deemed to qualify for 40 subsidised hours a week, will receive discounts off 12 hours of out-of-school care a week during term time – but 40 discounted hours a week during school holidays.
11) The first subsidies are expected to flow from November 25th.


Legacy scheme

In a written reply to a query, a department spokesman said: “The extended ‘savers’ provision under Budget 2020 means that those already on a legacy scheme before the relevant date will be able to remain on them indefinitely, for example, until they no longer require early learning and care or school-age childcare or are no longer eligible under the terms of the legacy scheme.”

Katherine Zappone said there would be families on existing subvention schemes who might receive less funding under the new scheme

In February 2017, Minister for Children Katherine Zappone said there would be families on existing subvention schemes who might receive less funding under the new scheme. She estimated then that 90 per cent of the current beneficiaries would be better off, while "the remaining 10 per cent will have their current level of subsidy protected for a transitional period".

However, that safeguard, although now upgraded from transitional to indefinite for children already registered, is of no use to families with children coming into the system for the first time. The Community Childcare Subsidy Plus programme closed for new registrations on November 15th, and new applications for the various Training and Employment Childcare programmes will only be accepted up to February 14th, 2020.

After those dates, the fact that vulnerable families only have the option of the new scheme is a big concern for childcare providers working in the most disadvantaged areas in Ireland.

What’s more, the parallel running of schemes that deliver different entitlements for children in exactly the same circumstances is set to create a two-tier system, not only within creches but within families. Siblings registered after the cut-off dates for the old subsidy schemes may well have less access to early-years care and education than their older brother or sister who is still covered by a former programme.

The upside

On the positive side, 7,500 children will be allocated income-related subsidies for the first time, once parents have completed their applications for the new scheme, while another 40,000 children already receiving subsidies will have those increased, according to department estimates.

Mick Kenny, a community childcare co-ordinator in Urlingford, Co Kilkenny, sees the new scheme as "a shift in government policy from a child-centred approach to a scheme focused on work activation". The children who will "essentially be locked out" of early-years care, he argues, are those who need it most.

Under the scheme, children of families where one parent is neither working nor in education/training have their attendance at a care centre subsidised for just 15 hours a week, rising to 20 hours from September 7th, 2020. On the Community Childcare Subsidy Plus, they could be entitled to funding for a full-time place. For school-age children of those families, that allocation of 15/20 hours is covered by school, so during term time they will not be entitled to any subsidised outside-school care that could provide food and homework support.

The Association of Childhood Professionals ran an online survey during the summer, in which more than 1,000 childcare services participated. The results suggested that more than a third of the early-years children currently supported by Community Childcare Subsidy Plus would be entitled to only 15 hours a week under the new scheme. For about 50 per cent of school-age children on that programme, it would mean no subsidies for outside-school care during term time. (The association estimates those percentages represent 8,000 and 5,500 children respectively.)

Kenny, who is a member of the association’s national council, says the new scheme discriminates against children based on the status of their parents and will cut off disadvantaged children from centre-based care for whom it has proven to be most beneficial.

Limerick childcare manager Steve Goode believes one Government policy is being undermined by another. While the First 5 early-years strategy makes quite clear the importance of early intervention – particularly for the most disadvantaged children – “then you have the [National Childcare Scheme], which penalises those parents”, he comments.

The definitions of “work” and “study” are comprehensive, covering different types of work and study arrangements, such as part-time, week on/week off and zero-hour contract arrangements, says the DCYA spokesman. All courses with awards on the National Framework of Qualifications are covered under the studying or training requirement.  “This rule seeks to address poverty and incentivise even small amounts of work or training,” he adds.

Private providers

If families can afford fewer, or no, hours of childcare, community centres providing that care will also be hit. Of the 4,500 childcare services, less than 30 per cent are non-profit operators, the rest are private providers.

The National Childcare Scheme’s hourly grant structure – as opposed to fixed time periods of the old schemes – “is not compatible with how we budget services”, for example for staff and premises costs, says Kenny. It will make some services unsustainable and also put extra costs on parents, he warns.

Hundreds of centres are already reeling from the withdrawal of a total of €5.7 million funding, up to last June. Pobal, which administers childcare schemes for the department, started a clampdown after rules for “compliance” were strengthened to distinguish between child enrolments and hours of actual attendance, something that providers argue is outside their control.

As the April 2019 minutes of the Department of Children’s board of management note: “The bar for compliance based on attendance figures is set at a high level, meaning that many services were identified as problematic.”

Some childcare providers tried to take the hit in reduced funding without cutting hours available to a family because, as one points out, “it is never the child’s fault” that they don’t attend.

When relationships between families and childcare staff are paramount for the welfare of a child, it is not fair to be asking centres to "police" parents, says Frances Byrne, director of policy at Early Childhood Ireland, while acknowledging there has to be accountability for the spending of public money.

It is "absolutely brilliant" that the new scheme will be supporting more working parents outside the [existing] targeted groups, says Marian Quinn, chair of the Association of Childhood Professionals. "But the reality is it is robbing Peter to pay Paul."

She sees the logic that getting parents out working breaks the cycle of poverty, “but that takes a very narrow view of how you can help children”, she says. “Some children cannot be helped through parents. Sometimes we just have to work with the children and make sure they have the quality supports, even if their parents can’t break out of a particular cycle, so that the children have a chance of doing so.”

Child’s needs

During the consultation process, the St Vincent de Paul advocated against basing a child’s entitlement to subsidised hours in a childcare centre on a parent’s economic status rather than the needs of child, says its social policy development officer Tricia Keilthy.

“There is a range of reasons a person may not be able to engage in work or training,” she points out, and the charity is concerned about how the new scheme will work in practice.

“It is a matter of identifying those weak spots and making sure there is sufficient funding, so people are not worse off in the short term – and then looking at the funding model in the long term.” The Minister has announced the setting-up of an expert group to develop a new funding model for early learning and care and school-age childcare.

Although State investment in early learning and care and school-age care has more than doubled over the last four years, that was from a very low base, and the sector is beset with problems. Parents pay some of the highest costs in Europe, yet 94 per cent of childcare workers say they cannot make ends meet on their pay (an average of about €11 an hour), according to a survey published by Siptu in September. Centres find it difficult to recruit and retain staff who, it could be argued, help subsidise the cost to parents because they work for such low wages.

The average fee for a full-time place in a childcare centre is €186 a week, according to latest figures released by the department, with the country’s most expensive area, Dún-Laoghaire Rathdown, recording an average fee of €265 per week.

Budget 2020, with its additional €54 million for childcare, will do little to address the legacy of underinvestment, says Byrne of Early Childhood Ireland. While Ireland invests 0.2 per cent of GDP in children’s early years, countries such as Sweden invest up to 1.9 per cent.

One Family, a support organisation for lone parents, runs an early-years service where the very vulnerable babies and children "don't really fit the scheme", says chief executive Karen Kiernan. As a result it is very hard for specialist services like this to get funding. "There is a real gap, nationally. In First 5 some of these things will come in the future, but we are years away from it."

The department has pointed out that the new scheme includes arrangements for vulnerable children and families to be sponsored by certain statutory bodies such as Tusla, the HSE and local authorities, to avail of free or additional childcare. But several organisations, including the Children’s Rights Alliance, are concerned that details of these referral pathways are yet to be revealed and may prove too bureaucratic and will be of no help to children of families not wanting to engage with that system.

Tanya Ward of the alliance is concerned that thresholds for sponsorship might be set too high and that undocumented children, for instance, could miss out.

“Early-years education is such an equaliser,” she stresses.“It gives every child a chance.”

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