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THE Government’s new childcare plan is threatened with chaos.

It was revealed today that one in six providers of childcare has not applied to take part in the new pre-school scheme. They claim the payments under the plan are too low and will drive them out of business.

This has raised fears that tens of thousands of young families will struggle to avail of the service.

Under the new plan, which begins in January, the Government provides payment for a set period each day, five days a week, for pre-school children. This replaces the Early Childcare Supplement, which is paid directly to parents.

Typically, it gives €48.50 a week to the childcare provider for the two hours and 15 minutes a day. Parents cannot be charged a top-up fee, although they must pay for any additional hours of childcare. The plan will cost €170m — just a third of the €480m spent last year on the previous scheme. Tens of thousands of children aged between three and four are entitled to the year’s free pre-school. But hundreds of pre-school providers have not signed up — and more are considering pulling out of the scheme, an Irish Independent investigation has found. They claim that the payments will, in many cases, not even cover their costs.

Figures from the Department of Children reveal that 844 of the 4,900 care providers notified of the free pre-school scheme did not return applications before the deadline of July 10.

As a result, thousands of families face confusion and uncertainty about how and where they will be able to get free pre-school education.

It raises the spectre of a two-tier system, with some parents paying for providers that opt out of the scheme, while others get a free service that does not seek to compete with that top tier. Worried childcare providers have presented Children’s Minister Barry Andrews with a raft of problems. They claim that pre-schools are banned from charging top-up fees, even if their overheads are higher.

Disparities

They cite official Central Statistics Office data to show that hourly childcare costs are 50pc higher in Dublin than most areas, yet there is no provision for regional disparities.

And they claim services that invested heavily in facilities and staff fear being squeezed out as generic, while basic “yellowpack” services are set up just to avail of the new scheme.

Under the plan, staff at pre-schools that operate a 38-week teaching year will not be paid for Christmas, Easter and midterm breaks. The State will not fund these breaks and the services can no longer recoup these costs from parents.

The department conceded that it was possible that “a shortage of pre-school year places may arise in a limited number of cases”.

It said 93,000 places were catered for, which more than met demand on a countrywide scale. However, there was no guarantee that these places were in the right areas.

Criticised

Childcare bodies have criticised the “one-size-fits-all” approach, which means some pre-school facilities in costlier areas such as Dublin could end up having to subsidise the cost of places, or even opt out altogether.

The National Children’s Nurseries Association and the National Association of Private Childcare Providers (NPCP) are both calling for a voucher system. They said this would allow parents to choose the most suitable facility, and pay top-up fees if necessary.

But the department said that mandatory top-up payments would not be permitted as it was a fundamental principle of the scheme that it was free for all children on an equal basis.

Mr Andrews has already bowed to pressure from providers to make changes to the scheme. Last week, he announced a higher capitation fee for services with highly qualified staff and extended the deadline for applications.

But Sharon Smyth of the NPCP, which was set up to lobby for changes, said that a number of other issues would need to be addressed if the minister was to avoid widespread pullouts when it came to signing up for the childcare scheme.

In its current guise, the plan would put many providers in financial difficulty, she said. Some had opted not to apply after parents agreed to pay the current fees rather than force providers to make severe cutbacks. This has led to fears of a two-tier system developing and accusations of price-fixing.  Log onto www.homehelp.ie for affordable child care providers in your local area.

• The Early Childhood Care and Education Scheme will begin next January, offering a free pre-school year to children.
• It replaces the Early Childcare Supplement paid directly to parents which is to end from December.
• Parents can opt for a year-round pre-school place that operates for 50 weeks of the year, in which case the child will receive a free two hours 15 minutes per day, five days a week; or for a 38-week service that offers three hours per day, five days per week.
• The scheme will be funded by the Department of Children, which will pay a capitation grant per child: €48.50 per week directly to the childcare provider for the 50-week service; €64.50 for the 38-week service; and a higher rate of €75 for providers with extra qualifications and experience.
• Parents must pay for any additional hours of childcare in the facility.   Log onto www.homehelp.ie  for affordable child care providers in your local area.