INCREASE IN CHILDCARE SUBSIDY

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INCREASE IN CHILDCARE SUBSIDY

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(Effect on affordability): **

4.

Dr Lim Wee Kiak asked the Minister for Community Development, Youth and Sports in light of the recent increase in Government childcare subsidy for working mothers (a) has there been an increase in the number of children put into childcare centres; (b) how many childcare centres raised their fees after the Government increased the subsidy; (c) are there cases of profiteering by these childcare centres; and (d) how much more do these mothers have to top-up in fees in order to put their children in childcare.

Dr Vivian Balakrishnan: The Government increased the childcare subsidy from $150 to $300 a month for working mothers with effect from 17th August 2008. Since August 2008, enrolment in childcare centres has increased by about 1,900 children or 3.5%, from a total enrolment of 53,000 children in August 2008, to reach about 55,000 children now. This is slightly higher than the 2.5% increase over the same period last year.

During this period, 114 centres have given notice that they will increase their fees. This is about 15% of all childcare centres. About one-third (36 centres) of these centres will effect the revised fees in January next year, while the rest are implementing the new fees late this year. The average fee increase is about $80.

MCYS strongly urges operators to exercise restraint and to keep their services affordable for parents. Operators should bear in mind increased competition in the sector given the plan for a further 200 new childcare centres to be established over the next five years. We expect that parents will select childcare centres that best meet their expectations in the most cost-effective manner.

For low-income households who require further assistance in childcare fees, MCYS currently provides the ComCare 'Centre-Based Financial Assistance Scheme for Childcare' (CFAC). Eligible low-income families can benefit from up to $340 under the CFAC. This is in addition to the $300 subsidy for all children of working mothers.

The Ministry will continue to monitor the situation and ensure that quality childcare services remain accessible and affordable to all Singaporean families.