Economist: Childcare 'the headline grabber'
Speaking at the launch of their quarterly economic outlook, Jim Power, Chief Economist at Friends First said that childcare is "to be the headline grabber this year".
Mr Power said: "Childcare is likely to be the headline grabber this year, just as disability was last year and decentralisation was the previous year. How much the Minister gives away in increased spending will be determined by his targeted deficit. He can afford to give anything up to €2.5bn away which allows for a very generous budget day package."
Mr Power said that this year's Budget is the first opportunity we will have to see where Minister for Finance, Brian Cowen's economic priorities lie.
According to Mr Power, the economic and social policy objectives of the budget are likely to focus on maintaining economic stability, maximizing job creation, improving the competitiveness of the economy, childcare provision, as well as the improvement of essential public services and the welfare of the disadvantaged in society.
To achieve these objectives, he said, the Govt should leave indirect taxes alone, and change tax bands and allowances in order to offer assistance to low and middle income workers.
However from a political perspective the top priority has got to be a significant package aimed at relieving the burden of childcare.
Commenting on the childcare issue, Mr Power said: "Childcare must be made a fully tax allowable expense at the marginal rates. The individualisation of the tax system succeeded in encouraging many women back into the work force. "
The number of women in the labour force has increased by 300,000 in the last decade. However many of these women are now under pressure.
"As families struggle with high mortgages and high child care costs, measures must be taken immediately to make childcare more affordable."
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