How easy would it be to create a free, nationalised childcare system?

“We probably get two, three phone calls a week from people desperately looking for childcare,” says Valerie O’Reilly of Rainbow Daycare in Sandyford.
O’Reilly has been running Rainbow for more than 20 years and says she is fortunate to own her premises, as it substantially eases the financial pressure involved.
O’Reilly is supportive of the various Government funding schemes brought about in recent years, designed to support parents and providers. Like more than 90 per cent of operators, she has signed up again to Core Funding, the payment from the State to providers. But she says she has many questions about the proposals that are being floated about a “nationalised system of childcare”.
O’Reilly argues that while increases to staff and other costs vary significantly from one operator to the next, Government supports are based on child numbers, and the fee freeze deprived services like hers of the ability to address any shortfalls through additional charges.
“I’ve no interest in one fee fits all,” she says, “and when I hear political parties talking about capping costs to parents at €10 a day, I think, that’s great, but where is all the rest of the money going to come from?”
Sinn Féin, Labour and the Social Democrats have all argued it should come from another substantial increase to public funding with each proposing caps on the fees parents would pay for full-time early learning and childcare of €200-€250 a month.
Ahead of an election that may be predictable fare from Opposition parties given how big an issue childcare has become but Minister for Children Roderic O’Gorman has said his party is also in favour of further fee reductions and greater State service provision in areas where there are shortages.
What caused more surprise recently, however, was Simon Harris suggesting he would like to see the State “moving to an affordable, high-quality, public early learning and childcare model”, and saying he does not “believe this vision will ever be achieved if we simply leave it to the market”.
Tánaiste Micheál Martin subsequently echoed the support for “greater State intervention” but sounded more sceptical about how this might be achieved.
“If we just throw out ideas without any substance behind them, a lot of those providers could take flight. I’m just hearing things, but I’m not hearing how you do them.”
The department already seems, however, to be figuring out what a much more State-led system might look like and how much it might cost.
That examination began in January, on foot of a recommendation made to it four years ago by an expert group. A special unit has been established within the department to investigate what a “nationalised” childcare model might look like in terms of “staff employment, pay and conditions; ownership and management of buildings; operating models; governance arrangements; service offering; fees for parents; and the overall funding model”.
On the basis of data assembled from core funding returns, the department says total wages in the sector are just over €1 billion and total running costs are €1.53 billion with no provision for profit.
In separately pointing to a total budget allocation for 2025 of €1.37 billion, the department effectively argues that it is already paying the bulk of existing costs. It says 69 per cent of providers’ funding comes from the State, according to its data, with 30 per cent paid by parents in fees. Total fees were previously estimated to amount to about €450 million.
However, Early Childhood Ireland, an umbrella body encompassing almost 4,500 providers with 330,000 children, says Ireland needs to reach an annual spend of €4 billion to provide the level of service really required.
Three years ago, the department suggested that matching Iceland’s commitment to the sector in terms of public spend as a proportion of GDP would involve spending almost half as much again.
Assistant professor at Dublin City University’s Institute of Education, Grainne McKenna, suggests this is just evidence that the current system is not working.
“Yes, Ireland is spending record levels of money on early childhood care and education,” she says, “but it is a fraction of what we see in other European countries. We are still repeatedly called out internationally for underinvestment.
“Every piece of research we have from the past 40 years, and this is from economists too, not just early childhood people like me, tells us that your best bet as a country is to invest in the most critical stage of development, which is in early childhood.
“But the current numbers don’t actually stack up to what you need to invest to have a functioning system that enables workforce participation for women and provides high-quality early childhood care and education, because there is no point in spending even €5 billion unless what you get is high quality.”
She points to Canada, the UK and, in particular, Australia as examples of how an over-reliance on private providers, particularly larger chains, led to the commercialisation of the system, poor returns on the State’s investment and a lack of quality for parents and children.
Karen Clince, of Tigers Childcare, which she founded 21 years ago and has since grown, with institutional backing, into one of the country’s largest providers with 22 services, employing 380 staff and catering to about 2,000 children, refutes the idea that larger chains can’t be an important part of the landscape.
There is a “unit cost”, she says, associated with the provision of that high-quality care and education, and while increased Government funding in its various forms has been a good thing, the associated constraints on operators have impacted their ability to deliver it, not least because of problems associated with staff recruitment.
“The issue is money,” she says. “One per cent of GDP [broadly in line with the Early Childhood Ireland proposal of €4 billion] would make an absolutely huge difference to the sector. Funding for pay needs to be ring-fenced because staffing is the biggest problem and leads to almost all the other problems.”
Siptu, which represents workers in the sector, agrees but believes operators generally are profitable enough to pay significantly more than current minimum rates which start at barely above minimum wage for many and just €15.50 for a graduate room leader.
Funding providers adequately is key to achieving that, Clince of Tigers Childcare says. She is highly sceptical of any suggestion that the Government would actually try to bypass, take over or replace those already in the sector.
And she left a meeting with Fine Gael representatives last week, she says, reassured they understood the importance of existing operators to the system.
Jennifer, who wishes to remain anonymous for fear of repercussions for her own childcare arrangements, is exasperated by what she regards as the continued failings of the current system despite the fanfare surrounding that Government spending.
“My husband and I both work full-time,” she says, “and our experience of the system is quite recent but, as far as I can see, everybody has to go through the madness of trying to find a place and then, in our case, when we expected our fees to come down, they went up instead because the provider left Core Funding and we had nowhere else to go.”
Most parents will have seen reductions, the department would point out but, “as far as I can see,” she says, “the workers aren’t happy, the parents aren’t happy and the providers aren’t happy”.
“I don’t mind paying a fair price but until there is more availability, it doesn’t seem I can do that and in the meantime it still feels like a lot of parents are being scammed.”