I propose to take Questions Nos. 227 and 228 together.
The Deputy will be aware that investment in childcare has increased by an unprecedented 117% over the last four budgets, now totalling €575m per year. Given the large amount of public money that is used in funding Early Learning and Care and School Age childcare programmes, there needs to be an appropriate level of oversight and accountability. Ensuring that this money is properly accounted for, and that as many children as possible benefit from it, is a core responsibility of the Department of Children and Youth Affairs. Pobal assists the Department in the administration of the funding and in ensuring that services are compliant with the clearly documented rules of the various early learning and care and school age childcare schemes.
The Public Accounts Committee on June 13 paid significant attention to this matter and highlighted the importance of compliance with scheme rules. The Department of Children and Youth Affairs' approach to compliance, and supporting services, strikes a necessary and appropriate balance. The approach involves setting out the rules for the receipt of State funding, supporting providers to deliver services, and at the same time, the approach offers assurances to the taxpayer that the funding assigned is being spent as it was intended through a strong compliance function.
Part of Pobal’s role in overseeing compliance with programme rules is to carry out unannounced visits to services to check their compliance with programme rules. Subsidies for the Early Learning and Care and School Age childcare programmes are paid based on child attendance, which is a vital governance component of the funding for which the Department is responsible. Where Pobal discover that the actual pattern of attendance of a child does not match registrations for that child on Pobal’s Programme Implementation Platform (IT system) they will calculate the amount of funding that has been overclaimed. The service will be advised by Pobal to make the necessary corrections to PIP registrations to ensure that the total amount of funding received for the programme year is correct.
There is an appropriate amount of flexibility applied to this corrections process and Pobal works with services on a case by case basis. Attendance rules and their application do not penalise parents who occasionally pick up or drop off children early. Pobal, when determining a pattern of attendance during a compliance visit, aim to apply the rules in a manner which maximises the amount payable to providers. However, the recovery of overclaimed funds is an integral part of ensuring that public money is properly accounted for.
From September 2018 to June 2019 (the latest available figures) Pobal identified 277 CCS services and 712 CCSP services with overclaims. It should be noted that some services have both a CCS and CCSP contract.
The total amount of overclaimed funding identified by Pobal for the same period was €3.2 million in CCS and €2.5 million in CCSP. It is important to note that these overclaim figures are calculated at the time of the compliance visit but cover the full period of children’s registration. They calculate any discrepancies up to the compliance visit date plus the amount that would have been overclaimed if the incorrect registration had persisted to the end of the programme year. In addition, an assumption is made that the level of attendance at the time of the visit will continue for the rest of the cycle (or duration of the registration if less). Overclaim figures therefore estimate the total amount that would have been overclaimed across the year had the compliance visit not occurred. Whilst the above amounts of overclaim were identified, some services made the case that they had registered children under the wrong scheme and hence corrections were accepted by Pobal, lessening the amount of overclaim significantly.
It is important to reiterate that the subvention for CCS and CCSP is paid to a service based on the actual attendance of a child. As such, no child should have had their provision cut as a result of a compliance visit; rather the service makes corrections to ensure that they are claiming for the actual time that the child is in attendance. It is important to note that the compliance activity should result in the service provider only claiming from the Department for the hours the child is attending. Data available to the Department shows that the number of children accessing Government subsidies continues to increase and has doubled in recent years.
The Department oversees a Case Management process through which local City / County Childcare Committees and Pobal work together to assess and provide support to early learning and care services in difficulty. This can include help with completing and interpreting analysis of staff ratios, fee setting and cash flow, as well as more specialised advice and support appropriate to individual circumstances. Financial supports, which may also be accessed through the Case Management process, are available for community services presenting with sustainability issues and following a financial assessment by Pobal. This includes a strand of funding targeted at community services requiring support to sustainably regularise their registrations.
The existing targeted childcare schemes will be replaced later this year with the National Childcare Scheme. Its attendance rules will seek to reflect the reality of children and parents' lives and the need for services to operate as businesses. The attendance rules will reflect a certain degree of flexibility whilst honouring the requirement to ensure that Exchequer funding is used for the purposes it was intended.
The National Childcare Scheme will mark another significant milestone for early learning and care and school age childcare in this country, creating an infrastructure from which Government can further increase investment in services over the next decade. This is in line with the commitment made in First 5, the Whole of Government Strategy for Babies, Young Children and their Families, which was published last November.