The FINANCIAL — The German Federal Ministry of Family Affairs, Senior Citizens, Women and Youth and KfW Bankengruppe will launch two new promotional programmes to expand childcare centres on 1 February 2013.
Between 2013 and 2015 KfW will provide loans totalling EUR 350 million to municipalities and other daycare centre operators to finance the expansion. The Family Ministry will support the programmes by providing an interest rate reduction.
"Our massive increase in federal funds for expanding childcare opportunities shows that we set the right priorities. Federal states, municipalities and centre operators now have planning certainty and can focus all their efforts on increasing daycare opportunities locally," said Kristina Schröder, Federal Minister of Family Affairs, Senior Citizens, Women and Youth. "A legal right to childcare starting in August 2013 is not negotiable for me since it will improve the opportunities for children to develop and make it easier for mothers and fathers to balance family life and their careers," said Minister Schröder. The support is part of the Federal Government's ten-point plan aimed at increasing Germany's supply of pre-kindergarten facilities.
"A number of municipalities and childcare centre operators experience problems when it comes to covering the expenses associated with the expansion and operation of a local daycare facility that meets parents' needs. KfW's new programmes "IKK – Kita-Ausbau" (Investment Loans for Municipalities – Childcare Expansion) and "IKU – Kita-Ausbau" (Investment Loans for Municipal Enterprises – Childcare Expansion) will help satisfy parents' legal right to a place in daycare for children under three years of age to which they will be entitled as of 1 August 2013," said Dr Axel Nawrath, member of the Executive Board of KfW Bankengruppe.
Investments eligible for funding include the construction of new buildings, conversions, reconstructions and refurbishments as well as renovation and modernisation measures and investments in equipment. As KfW reported, the purchase of land and buildings to provide more places for pre-kindergarten children in daycare centres and with childminders or nannies is eligible for funding.
Under the "Investment Loans for Municipalities – Childcare Expansion" (IKK) programme municipalities will obtain a loan directly from KfW. The promotional programme "Investment Loans for Municipal Enterprises – Childcare Expansion" (IKU), which targets municipal and non-profit organisations, natural persons and other investors who operate public or private youth welfare facilities or who work as childminders in day facilities and are trained in childcare, is available to such lenders through their regular bank. The interest rates for both programmes will be determined shortly before launch.
Already today stakeholders in childcare can obtain financing for planned investments under KfW's existing promotional programmes for municipal and commercial enterprises, such as the programme families "Investment Loans for Municipalities" (IKK), "Investment Loans for Municipal Enterprises" (IKU) and "Investment Loans for Social Organisations" (IKS).
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