Providers of childcare fear for their future
CHILDCARE providers have said they feel hammered by inflation and unable to raise fees, and have called for more investment in the sector.
The Budget strove to make fees more affordable for parents, with a 25% reduction in weekly childcare fees, worth up to €175 a month or €2,106 a year to families.
A further allocation of €59million will go to the recently established Core Funding model which will provide for extra hours and enhanced capacity in the sector, but it requires providers to freeze their fees.
The Government has said the childcare budget will reach €1billion next year – five years ahead of target.
Under the new Employment Regulation Order, those working in childcare will also see improved pay and conditions.
However, smaller operators questioned the sustainability of their businesses as overheads grow while fees are frozen.
David Owens runs the Wise Little Owls Montessori in Stillorgan, Dublin, which opened in June 2018 and now caters for 67 preschool children and 88 after-schoolers.
He has 24 staff and his business is entirely powered and heated by electricity.
His last two-monthly energy bill was for €2,000, covering the summer when the service was closed for several weeks, and he said he fears his winter bills could be in the order of €4,000. Last year they would have been €400.
Mr Owens said he was waiting to hear if the Temporary Business Energy Support Scheme (TBESS) to help businesses with their energy costs would be applied to creches and Montessori schools.
He noted that childcare businesses, unlike many others, were not allowed to claim back the VAT for their electricity and other services, which he estimated would be worth around €40,000 a year. Despite this, he still has to pay council rates of €10,000 a year.
‘The Budget is good news for parents but I am concerned about the longterm sustainability of our service. Core funding sounds amazing, but we do not yet know how it will work out, and the whole process has required such a volume of work that it has been exhausting.
‘If our overheads and costs were concrete and stable, that would be one thing and the fee freeze would be fair enough. But we don’t know what our costs and overheads are going to be over the coming year.’
He said he was also concerned about the administrative implications of having to recalculate all the fees his service charges to parents, based on the fee reduction announcement.
The founder of one of the largest providers in Ireland, Karen Clince of Tigers Childcare, agreed that the cost of childcare must fall further, while providers should be supported to expand their services.
‘The increased subsidies are very welcome and will make life that little bit easier for working families – especially single parents and families with multiple young children as well as women coming back from maternity leave,’ she said.
‘While the Government should be commended for taking this long-overdue step, it should be viewed as a building block towards more affordable childcare and a more sustainable future for the sector.’
‘It has been exhausting’