At least five community childcare providers in Dublin's inner city have had their funding significantly cut as a result of controversial government changes to the funding of these services.

This means there is now a "real risk" that services will close, leaving parents unable to find affordable childcare, a new report to be launched tomorrow has found.

According to research commissioned by the Dublin Inner City Partnership and the Dublin Inner City Childcare Providers' Network, low-paid parents who do not qualify for support may see their childcare fees more than double as a result of the changes.

The research provides the first real snapshot of how the Community Childcare Subvention Scheme is working on the ground since it came into effect, and indicates that significant numbers of childcare providers nationally may be struggling. There are 161 community childcare projects in greater Dublin alone.

Despite claims by government that the introduction of a new tiered payment scheme would increase funding for children most in need, the report warns that local people in some of the state's most disadvantaged communities may now be unable to afford childcare.

Providers also report difficulty managing the new scheme, which has been "unnecessarily complicated". They also express concern that they are no longer able to use their discretion to set fees at rates acceptable to parents who are in particular need.

"Some families who struggled the hardest to get themselves out of poverty and into employment are likely to lose support," the report states. "Vulnerable children will lose their valuable access to pre-school education and care."

The report studied 12 community childcare providers in Dublin's inner city. It found that seven had had their funding increased under the scheme, but five others have had it reduced by around 10% on average this year.

"Five projects are now directly at risk of losing staff, childcare places, services and experiencing further funding cuts in the immediate future. Some projects have already instigated pay freezes in a sector which is already low paid," it notes.