Creche subsidy plan reckless, says Martin

Childcare providers are now being contacted about a last-minute subsidy of up to €26,000, which was announced by Children’s Minister Katherine Zappone this week.

The financial package, which will be provided to childcare facilities before the end of the year, was announced by Ms Zappone just hours after both the Taoiseach and the finance minister ruled out emergency funding for the sector.

Fianna Fáil leader Micheál Martin has claimed it was “reckless” to roll out the €7m fund for childcare providers, many of whom have been scrambling to secure insurance or have been quoted up to 300% more for premiums after one of only two insurers in the market pulled out.

The exit of Ironshore Europe from the Irish market has put creches in a precarious position right before Christmas, with many contemplating closure in the new year.

However, it is understood that by lunchtime the remaining insurance underwriter, Allianz, had issued quotes to all but 50 of the country’s 4,400 childcare providers.

The Department of Children said that Allianz had provided quotes to 1,382 new customers.

Ms Zappone had warned that there would be a number of “high-risk” creches that may not be able to secure insurance after Ironshore Europe announced it would no longer be operating here.

Mr Martin said the announcement to provide payments to creches had been made with a general election in mind and would not solve the real issue of rising insurance costs.

He pointed to the fact that Taoiseach Leo Varadkar had told the Dáil on Wednesday that it would be reckless to provide childcare facilities with a subvention to help with the cost of insurance but “within two hours, it was sensible policy”.

“So I think we can deduce from that that electoral considerations are at play, but now what I suggest is the Government’s response is confused, it lacked clarity, and they seemed to be caught by surprise by the crisis in the childcare sector with insurance.”

Mr Martin said Fianna Fáil TD Darragh O’Brien had written to Ms Zappone about the issue two years ago.

He added: “I’m not sure if its fully viable, but what should be explored is where mutual bodies could be used as a vehicle to insure creches which would have avoided the necessity of a subsidy, but this seems to be made up on the back of an envelope.

“I think the insurance crisis is becoming worse, it is hitting different sectors and the Alliance for Insurance Reform have been on about this one for about two years. And there are deep worries in some sectors that people will be priced out of business,” said Mr Martin.

Creches will receive an average of €1,500, but some childcare services are set to get as much as €26,000 depending on the number of children in their care.

The department said this payment is not being made to cover insurance costs but rather to compensate providers for the additional time required to complete the administrative work associated with various State schemes.