Early Childhood Care and Education

77. Deputy Daniel Ennis asked the Minister for Children, Disability and Equality the number of early learning and childcare providers that will be expected to lower their fees due to the change in maximum fee bands as part of budget 2027. [77875/26]

The cost of childcare is affecting families across the country. For many, it is like paying their second mortgage. Parents in Ireland are paying the highest rates of childcare fees in Europe. It is putting huge pressure and strain on families. Particularly in my constituency of Dublin Central, I speak to so many and they are not seeing or feeling that reduction; they are feeling the strain. They will not see when it comes in the post next September. How many childcare providers will see a decrease in fees from additional allocations made in budget 2027?

I thank the Deputy very much. I am taking this on behalf of the Minister, Deputy Foley, who cannot be with us this morning. From September 2027, the maximum fees that early learning and childcare providers in receipt of core funding can charge will be reduced across all bands with the maximum fee cap for band B and E reducing from €280 to €250 per week and all other bands being proportionally reduced. The majority of services have fees below the new caps and will continue to be subject to existing fee management controls. Core funding is a supply-side grant to early learning and childcare providers towards their operating costs. It is designed to promote affordability for parents and sustainability for providers through increased funding to the sector paid on a consistent and equitable basis. A key condition of receiving the significant State funding that is available through the scheme requires that a partner service adheres to the core funding fee management system, which includes a freeze on fees at 2021 levels and fee caps. This is to ensure that the State’s significant investment through the scheme is not absorbed by unnecessary fee increases. These fee management conditions of the core funding scheme apply exclusively to partner services who have signed a core funding agreement. These requirements are not applicable to services which remain outside of the core funding scheme. For the programme year 2026-27, the fee tables of all partner services will be subject to the review and approval of their childcare committees. This will help further with the simplification and standardisation of fee tables for all partner services. Additionally, all fee tables will be validated against their original fee tables, or fees charged if these differ, which have been in place since the fee freeze on 30 September 2021. This is to confirm adherence to the fee freeze as part of the core funding rules and will also ensure the Department has access to accurate data on the fees charged by all partner services, while verifying their adherence to the fee freeze. Following the review by county childcare committees, a comprehensive assessment using 2026 and 2027 service and fee information will be completed, providing a more accurate and complete assessment of the sector-wide impact of the 2027 fee caps. This work is scheduled for completion in the first quarter of next year, depending on data availability. Previous year four analysis was based on 2026 fee data and does not represent a complete picture of the services operating in the current 2026-27 core funding year that may be affected by the fee cap. However, the comprehensive assessment using 2026-27 service and fee information will provide the more detailed insights into the impact of the proposed fee caps.

The Minister of State mentioned core funding. If your childcare provider is not in core funding, the €550 per month cap will not apply. If your child is in childcare for more than 50 hours in one week, the €550 per month cap will not apply. If your child is in first class or above, the €550 per month cap will not apply. Again, in my own constituency, we have some of the highest levels in the country of providers not in core funding. It is some of the highest prices of anywhere in the country and anywhere in Europe. The Government said a key priority in this budget was making early learning and childcare more affordable for families, yet for so many families nothing is going to change from them. I am one of those families. In the playground beside the crèche, I am talking to so many families who are scratching their heads and saying, "We are not going to benefit from that." They are going to continue to pay astronomical fees for childcare and they will continue to struggle. A lot of them are keen to find a childcare space. I cannot help but use the phrase that the Minister of State is misleading us here. The €550 per month cap is misleading us. It is throwing money at a burning house.

These reductions are for people availing of places subsidised through core funding. That means it applies to 4,700 services or to 92% of all eligible providers. They will receive an increase in core funding, which will also include support for potential increases in wages for early years and childcare professionals. I appreciate the Deputy said a high number of providers in his constituency do not avail of core funding. This year, eight childcare providers across the country withdrew from core funding, three of which rejoined the scheme. The trend of rejoining is consistent with previous years' trajectories. We want providers in the scheme because we want to be able to support them and reduce the cost for parents. From a parent's perspective, being in the scheme means lower fee limits and increased subsidies. That will help with childcare bills.

Again, I have to go back to the cap of €550 for 45 hours' service based on the most popular contract the Minister of State mentioned in her response. When we met providers after the budget, we were told such contracts will only impact 18% of the sector. What about the other 82%? What about the families who are struggling? For me and them, the budget is beyond disappointing. Childcare providers have said that the Government's announcement was intentionally misleading. Most people I have spoken to are of that thought. The Government has also chosen to focus on the 45-hour per week contract because after that the subsidies in the national childcare scheme no longer apply. That is all fairly obvious. The monthly cap for families in this band is over a third higher than the promised €550 per month. Families not affected by fee caps will see a reduction of only €16.20 in their bills each week. Everyone in the Chamber would agree that is simply not enough for many families. Again, we would all agree that the Government is not doing enough.

I agree that many parents are paying too much for childcare. This is something the Minister, Deputy Foley, who has responsibility for this, is determined to help change. That is why the Government has committed to reducing childcare fees to €200 per month over the lifetime of the Government. It is why the Minister has tasked the Department with devising a roadmap on how to achieve that,which will be published in the coming weeks. It is why childcare received such a huge injection of investment in this year's budget. We want to support parents by bringing down fees. The Deputy mentioned bands and the number of hours involved. I want to be clear. Parents who are availing of 40 to 50 hours of childcare will pay a maximum of €250 per month, which is a saving of €2,200 over the course of the year. Parents in receipt of 50 hours or more of childcare will pay a maximum of €300 per week, equating to €2,500 worth of savings over a year.