Developers are pocketing tax incentives for the construction of childcare facilities and they are not being passed on to childcare providers, an Oireachtas committee heard yesterday.
Sylda Langford, a senior Department of Justice official who chairs a childcare co-ordinating committee, said builders had benefited from a 100 per cent tax write-off against the cost of providing childcare facilities.
However in many cases these facilities were sold on to childcare providers at full market value. As a result, providers were unable to pass on cheaper costs to parents.
"That piece of public policy needs to be strongly managed," Ms Langford told the Oireachtas Committee on Justice, Equality, Defence and Women's Rights.
A proposal to ensure childcare providers benefit from tax incentives or to oblige developers to construct childcare facilities is believed to be one option contained in a blueprint on childcare options the Government is examining before the Budget.
Dr Maureen Gaffney, chair of the National Economic and Social Council (NESC), a State think-tank, said a bold move by the Government on early education and childcare could be "a major landmark in the social and educational history of the State".
The NESC report, published recently, proposes measures such as extended parental leave and a year's free pre-school for three- to four-year-olds.