Notes on the Front

Here are four stories about childcare provision in Ireland today.

The first comes from Elaine Dunne, a childcare provider and spokesperson for the Federation of Early Childcare Providers.  She was discussing waiting lists for young children (under the age of 18 months) on Drivetime.

‘We only take in children in from the age of 18 months to two years.  We don’t go below that because it’s a part of the business that we struggled in and we had no choice but to close it down.  And we are hearing that from a lot of crèches around the country that it is not a viable part of the business . . . ‘

Obviously, if a business is running a product or service line that is losing money, closing it is an understandable option.  But should childcare be treated as a business – with ROIs and EBITDAs and profit projections?  In fact, if childcare is a business, it is an unusual one.  Unlike most businesses that generate revenue by selling their products to people who want to buy them, nearly 70% of childcare providers’ revenue comes from the state; only 30% is generated by ‘the market’.

Or put another way, when was the last time you heard a national school being described as a ‘business’.

The second story appeared in the Irish Independent:

‘Directors at a Dublin creche group that was at the centre of RTÉ’s A Breach of Trust documentary more than a decade ago paid out a dividend of €1.08 million last year, as operating profits increased by 12% . . . This followed a dividend payout of €277,149 in 2024.’

Links Creche and Montessori paid a dividend of €1.1 million to its’ owners last year.  But it isn’t alone.  One of the largest creche operators in the state, Giraffe Childcare, paid €11.8 million in dividends between 2019 and 2024.

This might raise some eyebrows but what is the point of owning a business if you can’t extract value from it?

The third story concerns the financial activities of creches. The owners of childcare companies can use their profits, cash holdings and borrowing facilities for activities that have nothing to do with childcare.  For instance, Links Creche diverted resources to invest in luxury property.  From Links childcare 2021 accounts:

“The company advanced an initial loan of €1,500,000 to connected undertaking P. Kelly Villas Limited in a previous financial year and has advanced further loan funding in the current financial year. The loan balance receivable by the company at the financial year end amounts to €3,064,667 (31 October 2020 – €1,500,000) . . . P. Kelly Villas Limited is a company which is registered in Republic of Ireland and is a connected party by virtue of common shareholders and directors.”

The company advanced a loan to a director to invest in Kelly Villas. This company specialises in luxury property rentals in places such as Florida, Lanzarote, Marbella, etc.  This is, in both geography and business activity, a long ways from caring for children.

Distributing dividends, business justification, leveraging assets, extracting profits, generous directors’ remuneration:  none of this sit easily with what should be a public service. 

In fact, it shouldn’t sit at all.

Fortunately, there is a fourth, better story.  There are nearly 35,000 childcare educators, manager- employees and ancillary staff – all committed to providing the best quality care to children despite the under-funding and under-staffing.  A quarter of all early years’ services are provided by community, non-profit, organisations.   And a number of private firms are local owner-proprietors – many of whom were formerly employees – who are closer to a community ethos than to corporate interests.

They are being let down by a government policy that remains committed to market solutions.  This is leading to a greater concentration of services among  a handful of corporate chains; all the while the Government pays out more and more public subsidies.

There is an alternative – and it lies in the skills, experience and commitment of the women and men (mostly women – 96% of all staff) who provide this vital work.  If we start from there, we can build an affordable, accessible and professional childcare public service.