Thousands of children will not be eligible for subsidised childcare as a result of changes to the way community childcare providers are funded by the State, campaigners have warned.
From January of next year, subventions for children in community-based childcare facilities will only be available to parents of children on social welfare.
Parents on lower and middle incomes will have to pay the full cost price of childcare.
Childcare providers say funding changes threaten to undermine the non-profit community-based childcare sector by increasing costs for parents and making some services unsustainable.
The Government, however, says the changes mean State funds will be targeted at children most in need of support and will involve even greater levels of funding.
The changes involve the replacement of the system where childcare providers were given grant aid towards their staffing costs with subventions based on the income level of parents.
For example, parents in receipt of social welfare will receive a €80 weekly subvention for full daycare, while parents in receipt of the Family Income Supplement will receive a €30 weekly subvention.
Parents who do not qualify under either of these categories will be charged the cost price for their childcare service.
The IPPA, an early childhood organisation whose membership includes dozens of community-based childcare organisations, has welcomed the intent behind the changes.
However, it warns that many providers face losing subventions for children attending their services and will have to charge more for childcare or end up losing staff.
One service provider, the Mellow Spring Childcare Development Centre in Finglas, says costs will rise significantly for parents who fall outside the subvention criteria.
Breda Kenny, a director of the centre, also said its attempts to create a social mix by providing services to parents on social welfare and those in the labour force would be undermined.
"We have parents of all backgrounds with children here," she said. "A good social mix was encouraged by the most recent childcare funding programme. This benefits children themselves and is good for the community.
"We don't want to create a ghetto situation.
"We also estimate that we'll get around €35,000 less under the new system compared to the staffing grants. There's also huge uncertainty.
"It reduces our capacity to budget and plan and offer security of tenure for staff."
However, Minister for Children Brendan Smith says the new funding system will involve €153 million over the next three years, representing a 16 per cent increase in funding over the old system.
In a Dáil response to a question last week, he said the majority of service providers would benefit under the new system.
This system, he said, was more equitable and would target social disadvantage more effectively.
