Andy: The High Cost of Childcare Perpetuates Inequality

At a site in Spencer Dock, some ask whether facilities in a future development will serve “long-established working-class neighbourhoods, or just for the young professionals likely to move in who can afford to pay for access”.

That the plans don’t include a crèche has raised eyebrows. Especially when a nearby childcare facility has 92 part-time places, but a waiting list of some 50 children.

A new report by the Economic and Social Research Institute (ESRI) – Maternal Employment and the Cost of Childcare in Ireland – takes up broader issues of childcare availability and cost in Ireland.

Childcare costs more in Ireland than in most other rich countries as a proportion of income, the study finds. Those costs, too, are unequally distributed.

For a typical 3-year-old featured in the ESRI study, a family paid 12 percent of their disposable income on childcare. That figure rose to 16 percent for a lone-parent family and to 20 percent for a family in the poorest 10 percent in the country.

The higher childcare costs are, the lower the number of hours that mothers tend to work. Given that those costs are most onerous for low-income parents, that means that poorer mothers face the greatest disincentives and barriers to taking up paid employment.

In a vicious circle, “exclusion from the labour market due to childcare costs will increase poverty risks and household joblessness”, the report finds.

Darragh O’Connor of the trade union SIPTU addressed the same issues in the Irish Times. Citing figures from Pobal, the agency charged with supporting community development, which also supported the ESRI study, O’Connor notes that average childcare fees in Ireland are €697 per month, and over €1,000 a month in Dublin.

Echoing ESRI’s conclusions, this makes them the second most expensive among Organisation for Economic Cooperation and Development (OECD) members (the rich countries) for two-parent families – and the most expensive of all for single-parent families.

This is on top of the fact that another ESRI study has found that working lone parents already lost income from changes introduced in 2011 to the Lone Parent Allowance.

Nor do high childcare costs translate into significant gains for childcare workers. Many are leaving the sector because of low wages, and the lack of a pay scale. (And of course a significant number may work outside the regulatory and tax net altogether).

But the employers, in fairness, are also under pressure. If they improve wages and working conditions they will probably have to increase fees, further discouraging parents – especially poorer ones – from sending their children to them in the first place.

The problem can, realistically, only be resolved by state intervention. But currently, Ireland spends less on “pre-primary education” than any other EU country at 0.10 percent of GDP, by one count.

Both O’Connor and the ESRI credit the government with some progressive reforms, albeit minor ones, introduced in 2017. A lot more needs to be done.

What does not need to be done is to adopt Minister Shane Ross’ madcap suggestion for a so-called “granny grant”, a €1,000 payment to any grandparent who does any childminding, regardless of their own or their family’s income.

Advocacy groups such as Early Childhood Ireland have pointed out that the proposal will do nothing to boost the supply of well-regulated and affordable childcare for those who need it most.

Mercifully, the Minister for Finance seems to be sceptical about Ross’ proposal. That may be a small mercy in the context of our deeply unequal society, including when it comes to looking after children. But it is a mercy nonetheless.