Extending the National Childcare Scheme to childminders could reduce the cost of care

by HRHQ Editorial Team

The cost of childcare by childminders may decrease by an average of €100 per month if care provided by childminders becomes eligible for the National Childcare Scheme. Such is the finding of new research by the ESRI, presented at the annual Budget Perspectives conference on 15th June.

Prior to the introduction of the National Childcare Scheme (NCS), parents in Ireland faced some of the highest childcare costs among OECD countries. The NCS provides subsidies for users of Tusla-registered childcare. Childminder care, which is typically unregistered, is however, the second most widely used form of paid childcare in Ireland and is not currently subsidised. The National Action Plan for Childminders has committed to the extension of NCS subsidies to childminders who care for non-relative children in the childminder’s own home. The extension is expected to happen on a phased basis over a three-year period from 2024.

This research shows that extending the NCS to children cared for by childminders will cost €35-122 million per annum, depending on how well the scheme is taken up. If all current non-relative childminders register with Tusla and all eligible parents claim NCS subsidies, the reform will benefit 80,000 children by an average of around €100 per month. Children cared for by a childminder tend to live in households with relatively high disposable income and high levels of parental employment, compared to children in centre-based care. The reform will therefore benefit middle-income households more than low- or high-income households.

Subsidising the cost of childminder care is likely to have other knock-on consequences. First, it may reduce the demand for formal (centre-based) care which could alleviate some of the current shortages of this form of childcare. Second, it may increase mothers’ labour supply by reducing barriers to work. Third, wider and positive societal impacts are likely if regulation of the childminder sector improves quality of care and health and safety. However, much depends on the administrative or financial requirements placed on childminders by the increased regulation.