RTÉ News has learned that the Early Childcare Allowance is to be paid to the children of all workers from EU countries living here, whether or not their children are resident in Ireland.
As a result, Fine Gael says the Government may have underestimated the cost of the allowance by as much as €150m.
The allowance of €1,000 per year, given to parents of all children under six, was announced in the budget in December, and was to be paid from the middle of this year to help parents defray the high cost of childcare here.
The Government says the payments to children not resident here will not significantly add to the cost of the scheme.
Since May 2004 many welfare payments are subject to the Habitual Residence Condition which was introduced to prevent so-called ‘welfare tourism’.
However, under EU regulations family payments like child benefit are exempt from this condition and it appears the new childcare supplement will fall into this category.
The Minister for Children, Brian Lenihan, said the costing for the scheme had been based on the numbers claiming child benefit and he did not envisage a significant rise in this number.
He also stressed that Ireland was obliged under EU law to make the payment available to all EU citizens working here.
However, it has emerged that only a few hundred of the 166,000 workers from accession states claim child benefit for children living in their home country.
But in recent times applications to the Department of Social Welfare are at 50 to 60 per week. This figure could rise to thousands in the future.
Fine Gael has accused the Government of being incapable of costing the measure and says it was a ridiculous situation that Irish tax payers would be funding childcare for children not resident here.
Legislation on the issue will be finalised later this week in the Social Welfare Bill.
