Government official grilled by watchdog over ‘astronomical costs’ of childcare

A senior Government official has come under pressure to explain what is being done to reduce the “astronomical costs” of childcare during an appearance before the Dáil’s public spending watchdog.

Kevin McCarthy, secretary general at the Department of Children, was also asked on Thursday about a shortage of creche places for children under the age of one, which Sinn Féin TD Imelda Munster said was “creating a nightmare for parents at the moment”.

Mr McCarthy was at the Public Accounts Committee (PAC) to be questioned about his department’s spending in 2020. Members heard that €601 million was spent by the department that year on programmes for children and young people including Early Childhood Care and Education (ECCE) supports and the National Childcare Scheme (NCS). Some €83 million of this was on Covid-19 related supports.

Minister for Children Roderic O’Gorman announced plans at the time of Budget 2022 to ask childcare providers to freeze creche fees at last September’s levels in return for a new funding scheme designed to improve terms and conditions in the sector. Mr McCarthy referenced this plan as he defended the department’s actions in the area of childcare.

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Ms Munster said the plan to freeze prices was “not good enough” and asked: “At what point are you going to bring prices down?”

She raised the case of a teacher in her area on maternity leave seeking two childcare spaces. The teacher’s mortgage is €900 per month and she got a quote for childcare of €1,600 per month. “There’s people like that in every town and village across the country. What’s been done about that?” she asked.

Mr McCarthy said the new funding model from September will see “very significant increased public investment going into the sector”. He said that ultimately the aim of this will be to reduce fees for parents but this will need “further public investment over time”.

Ms Munster pressed him on how the plan will “reduce those astronomical costs”.

Mr McCarthy said fees will be frozen from September and “our objective is to be able to reduce fees beyond that, but that’s a budgetary issue”.

He added that Mr O’Gorman “is very keen, obviously to be in a position to do that ... We will be putting forward proposals to enable us to make further progress on that issue of affordability for parents next year and beyond.”

Ms Munster also raised the issue of a shortage of creche places for children aged under one. Many creches do not accept babies as it requires them to have higher staffing levels. She said the issue is “causing untold stress for parents” and she asked what they can do if they can’t find a place for a child who is under one.

Mr McCarthy said County Childcare Committees stay in close contact with providers and seek to increase capacity if there are shortages. He said the department is aware there can be “pressure points in particular locations” and concerned parents should contact their local committee.

“If there’s a need for additional funding support for providers in order to ensure that additional places can be made available to meet the need, that is what will happen.”