Tax relief of up to £80 a week towards childcare costs has been recommended in a report published by the Department of Justice, Equality and Law Reform.
But the Minister, Mr O'Donoghue, has already come under fire from Fine Gael for referring the report to an interdepartmental committee for evaluation.
The Labour Party has condemned the report for placing too much emphasis on commercial childcare facilities instead of helping parents to spend more time with their children.
The Partnership 2000 Expert Working Group on Childcare was produced by a body representing the social partners, women's and parents' groups and the childcare sector.
As well as tax relief, it recommends subsidies for low earners to whom tax relief would be of little or no benefit.
It also calls for grants and subsidies for childcare providers who, it says, are finding it hard to recruit staff and some of whom have closed down because of regulations issued three years ago.
The report says every childminder, including nearly 40,000 women who mind children in their own homes, should be obliged to register.
It also makes tax relief dependent on being able to provide childminding receipts.
Childminders, however, should also get a special tax allowance, it says, and their childminding income should not count against them in social welfare means tests.
Employers should be able to claim childcare subsidies as a cost for tax purposes, it says, and employees should not pay tax on these subsidies.
Mr O'Donoghue said yesterday he would forward the report to an interdepartmental committee.
The committee will look at this report along with two others - the Report of the Commission on the Family and the Report of the Forum on Early Childhood Education.
It will evaluate their proposals, put them in order of priority, cost them and make recommendations within six months, said the Minister. Mr O'Donoghue said he was not trying to put the childcare proposals on the long finger.
But the Fine Gael TD, Ms Frances Fitzgerald, responsible for promoting the interests of women within the party, said "to ask yet another committee to evaluate the next steps is an abdication of political responsibility.
"There is a crisis situation in childcare and the Government should immediately announce a range of interim measures to alleviate the situation for parents and children."
The publication of the report was welcomed by the Labour Party spokeswoman on children and the family, Ms Roisin Shortall, but she was critical of what she called its lack of overall consistency and coherency.
"One of the core short-falls of this report is the lack of emphasis on the role of parents in child care," she said. "I am disappointed that the terms of reference did not include increased work flexibility and paid parental leave." The report was welcomed by employers, unions and farm bodies.