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Review finds that the average cost of delivering childcare across all services in Ireland is €4.14 per hour

The review was undertaken by Crowe in association with Apteligen in 2018.

AN INDEPENDENT REVIEW has found that the overall average cost of delivering childcare across all services in Ireland is €4.14 an hour.

The review, undertaken by Crowe in association with Apteligen in 2018, is part of efforts to establish an evidence base for the development and support of accessible childcare.

It found that location, the type of service provided, occupancy levels and the size of a service are among the key drivers of the cost of providing childcare in Ireland.

The average unit cost of €4.14 an hour varies across service type and geographic area.

The review noted that childcare services may be generally cheaper to deliver in rural areas and for some services, such as school-age childcare services, due to lower ratio requirements.

It also found that learning and childcare can sometimes be delivered more efficiently, such as in larger services possibly due to economies of scale, and services with higher occupancy rates.

Furthermore, evidence of higher costs for higher quality were found, such as in services where graduates are employed. The review suggested that this was possibly due to higher staff costs.

The review analysed the various costs of providing childcare services and the factors that impact on these costs, in order to allow for a stronger analysis of policy changes and variations in what drives those costs

The process involved engagement with key stakeholders from the sector, and the administration of a survey to centre-based providers nationally.

The review found that staff costs generally account for almost 70% of the overall operating costs of childcare in Ireland, a pattern consistent with those in other countries.

Minister for Children Roderic O’Gorman welcomed the publication of the review and thanked providers who participated in it.

“The findings from this review provide us with a rich and detailed understanding of the childcare market and a sound analytical underpinning to inform future funding decisions,” he said.

“While the findings on unit cost give us some confidence in our current levels of State subvention, I am acutely aware that the unit cost is based on pay rates in the sector that are unacceptably low.

“I also acknowledge that the unit cost varies substantially across services and, for some services, their unit cost will be lower or higher than this.”

The Minister added that the development of a ‘cost calculator’ would assist his department in estimating how future policy changes would impact on the cost of delivering services.

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