Dáil Éireann Debate, Tuesday - 1 February 2022
567. Deputy Jennifer Whitmore asked the Minister for Children, Equality, Disability, Integration and Youth if there is a transitional fund available for child care facilities from May to August 2022; if so, if a child care provider can increase fees during this time; when further information will be provided to facilities and parents of the new funding model due to commence in September 2022; and if he will make a statement on the matter. [4247/22]
View answerBudget 2022 announced a series of measures to increase investment in the Early Learning and Care (ELC) and School-Age Childcare (SAC) sector to €716 million this year.
One of those measures is a Transition Fund which will be available to ELC and SAC services from May to August inclusive, during the period between the phasing out of the Employment Wage Subsidy Scheme (EWSS) in April and the introduction of a new Core Funding stream in September.
The core conditionality of access to the Transition Fund will be that services do not increase the fees charged to parents above September 2021 levels.
The Transition Fund will be followed in September by a new Core Funding stream, also announced in Budget 2022. Core Funding is a major recommendation in the report of the Expert Group to develop a new funding model, Partnership for the Public Good: A New Funding Model for ELC and SAC available here: first5fundingmodel.gov.ie/report/.
The recommendations of the Expert Group are designed to deliver quality for children, affordability for parents, stability for providers, and support employers to improve pay and conditions for staff.
Core Funding will operate from September and will be worth up to €69 million in 2022 and up to €207 million in a full year from 2023 on.
The contractual requirement for fees to remain at or below September 2021 levels will apply to Transition Fund from May 2022. It will continue apply from September 2022 for services in receipt Core Funding. The Transition Fund and Core Funding will be open to all services, subject to them agreeing to come into contract and these prevention of fee increases will apply for both schemes.
The sum paid to each service under the Transition Fund will depend on the service’s capacity, location, and service type.
The calculation of the value of the new Core Funding stream to an individual provider will take account of their level of capacity including the number of children, the ages of children, and their hours of operation and will reflect the qualification levels of staff. By basing the core funding stream on capacity, providers will have a stable income source based on the service they deliver.
Since the announcements on Budget Day last October, my Department has been communicating with stakeholders including providers and representative organisations through a number of mechanisms, including for example FAQs, available here: www.gov.ie/en/publication/b3e97-budget-2022-overview-and-faqs-for-early-learning-and-care-elc-and-school-age-childcare-sac-providers-and-parents/. Detailed information on the new funding model is also available in the recommendations of the Expert Group report referenced above.
Additional communications will issue to the sector in the coming months to give further details on the new funding streams.
Budget 2022 also confirmed that ELC and SAC employers will continue to benefit from the exemption to the turnover rule for the EWSS until April 2022 in order to prevent the additional costs from public health measures being passed on to parents.
The EWSS has been available to employers in the sector since August 2020, with enhanced EWSS rates (from October 2020-January 2022) equalling €34 million per month, covering on average 80% of payroll costs and 50% of total operating costs for providers, standard EWSS equalling €22 million per month (from August 2020-October 2020 and for February 2022), covering on average 50% of payroll costs and 38% of total operating costs for providers and a new EWSS flat rate of €100 that will apply from March-April 2022 amounting to €11 million per month, covering on average, 25% staff costs or 11% total operating costs.
In advance of May 2022, given the level of investment being made available to the sector through EWSS, it is difficult to see any justification for an increase in fees at this time.
Where providers require further financial assistance in addition to current supports available, the Department operates a Covid-19 Impact Support Scheme. This is additional to the existing financial supports and is to support the sustainability of ELC and SAC services who may be left with short-term sustainability concerns due to lower attendance or higher costs arising from Covid-19. This scheme supports services to remain open without increasing their Registered Fees to parents or guardians.
Sustainability Funding also continues to be available to providers where there are sustainability difficulties and I have requested that providers would exhaust this route before considering increases in fees for parents. I encourage providers to contact their local City/County Childcare Committee if they require any further information or support: myccc.ie/.
