When Minister for Public Expenditure Jack Chambers took to the floor of the Dáil last week to give what is ostensibly good news to parents of young children, confusion over what childcare fees they will pay in 2027 quickly gave way to anger.
The Minister said he would be reducing “the maximum childcare fees paid by parents from €735 to €550 per month for children up to senior infants from September of next year”.
The many parents who are currently paying well above that €750 figure were quick to get in touch with Irish Times deputy business editor Dominic Coyle.
“Not for the first time there appears to be a substantial ‘reality gap’ between the Government’s understanding of the ‘maximum’ cost of care and the real maximum under its own core funding rules,” Coyle wrote in his follow-up Budget Q&A.
Coyle was reacting to the slew of emails he’d received from parents sharing their creche bills of up to €1,400.
“It was just, I think, largely a very unfortunate use of the word ‘maximum’, which certainly alerted parents in and around Dublin and the other cities: ‘Heck, why am I paying more than this? Am I being ripped off? Am I missing something?” he tells the Better with Money podcast.
As a member of one of those momentarily confused households, I can relate to the frustration. Childcare is one of the big bills facing families where both parents work.
Before recording this episode, I went back over the invoices to see how much my husband and I have spent on childcare over the past five years.
I was floored to find we’d paid €54,864 for creche, childminding and after-school care for our daughters since 2021.
And we’re some of the lucky ones. Not just because we managed to secure places in the face of fierce competition in the busy commuter belt of Co Kildare, but because childcare fees have been falling for parents since the introduction of the National Childcare Scheme in 2019.
The generation of parents immediately before that were paying well in excess of €1,000 per child per month.
In this episode, Coyle explains where the discrepancy arose between Chambers’ announcement last week and the rate paid by many parents.
He explains the confusing fee system under the core funding scheme, what subsidies are available to parents and how lower-income households can avail of extra supports to help with the cost (such as the income assessed subsidy, due to rise next year for qualifying parents whose household net income doesn’t exceed €73,000).
The episode also examines what’s driving costs in the sector and why childcare providers say they’re being under-compensated, despite remuneration for workers hovering around the national minimum wage.
You can listen to the conversation on the player above or search for Better with Money wherever you get your podcasts.
- This episode is brought to you in association with Standard Life
