Plans announced in July 2007 had limited entitlement to subsidised community-based childcare to parents on social welfare or in receipt of the Family Income Supplement. These plans were angrily resisted by childcare providers, parents and some politicians, who pointed out that they would leave thousands of low-income parents without financial help for crèche facilities, and warned that they would reinforce welfare dependency among parents.

Under the revised scheme announced yesterday by Minister for Children Brendan Smith, current grant levels will continue to be supplied to providers until July of 2008. After that there will be further increases in subvention rates for parents on welfare and a new band of subvention aimed at low income parents.

• Parents on social welfare will receive a €100 a week subvention for childcare, up from €80 a week;
• Parents on Family Income Supplement will see the benefit increase from €30 a week to €70 a week;
• Low income parents who are above the threshold for the supplement will receive €45 a week.

The new tiered payments, to be introduced from July 2008 with the money going directly to childcare providers, will see some 40 per cent of community childcare providers receiving significant increases in direct funding, while others will receive either similar or lesser amounts.

"Transitional funding" guaranteeing current grant levels will continue to be supplied to providers until July of 2008, Minister Smith said. After that, grants for some may fall to not less than 90 per cent of their current level between July and December 2008; not less than 85 per cent of that amount in 2009; and not less than 75 per cent of that amount in 2010.

While the “improvements” to the original plans were welcomed by Fine Gael children’s spokesman Alan Shatter TD, he said the new scheme did not do enough to assist low-income parents who are above the Family Income Supplement threshold.

“Under the announcement made today, the Minister ... states all services are guaranteed subvention under the new scheme at 95% of the current rates until the end of 2008.

“It is not merely unfortunate, but mealy-mouthed and Scrooge-like, that he has determined at this time of year ... to reduce childcare subvention benefit by 5% in 2008. He should have simply ... continued the subvention in full under the current scheme for the entirety of 2008.” (Sources: Irish Times and other)