Dáil Éireann Debate, Tuesday - 11 July 2023
597. Deputy Colm Burke asked the Minister for Children, Equality, Disability, Integration and Youth to confirm that CORE funding will be increased to support childcare services and parents, particularly in light of rising costs; and if he will make a statement on the matter. [33469/23]
View answerThis Government has in 2023, for the first time, allocated more than €1 billion to early learning and childcare – a clear demonstration from Government of the value of the sector. Over the past eight budgets, investment in early learning and childcare has risen from €260 million in 2015 to € 1.025 billion in 2023, reaching the First 5 investment target 5 years ahead of time. This unprecedented investment speaks to the commitment of Government in prioritising early learning and childcare services.
The Programme for Government contains a number of commitments for early learning and childcare, including reforming the system to create one that brings together the best of community and private provision and the development of a new funding model for affordable, accessible, sustainable and high quality Early Learning and Care (ELC) and School-Age Childcare (SAC).
An Expert Group was established in September 2019 to develop a new funding model for the Early Learning and Childcare sector. Under their terms of reference, the Expert Group was asked to seek to further achieve policy objectives of quality, affordability, accessibility and contributing to addressing disadvantage in a privately-operated system through increased public funding and public management.
In December 2021, Government approved the 25 recommendations contained in the Expert Group report, Partnership for the Public Good: A New Funding Model for Early Learning and Care and School-Age Childcare. The recommendations were accepted in full by Government and implementation of this new funding model is well underway.
Core Funding, which began in September 2022, is the new funding stream to start the partnership for the public good between the State and providers. Its primary purpose is to improve pay and conditions in the sector as a whole and improve affordability for parents as well as ensuring a stable income to providers.
Core Funding offers greater stability and sustainability for providers by substantially increasing the overall investment in the sector, particularly through a supply-side funding approach and in providing funding for spaces rather than participating children. Services can choose to spend their Core Funding on any items connected to the high quality delivery of their service.
The original Core Funding allocation of €207m increased to €221m in Spring 2022 at a time when cost pressures were significantly increasing. This further increased to €259m based on significant capacity growth in sector in Budget 2023 with additional contributions for staff pay and conditions, non-staff overheads, administration staff/time and graduates factored in.
For the second year of operation, Core Funding will increase by €28 million, an 11% increase, to a total of €287m, providing a sustainable model with increases for all services. Further detail on the impacts of budget increases for sessional services have been recently published on our website: first5fundingmodel.gov.ie/core-funding/
Approximately €4m of this new funding will be used to remove the experience requirement on both Graduate Premiums under Core Funding, underpinned by new EROs. This move was widely welcomed in the sector.
The remaining €24m will be used for further developments and enhancements to the scheme. €6.11m in funding has been allocated for non-staff overheads, a significant increase on the current allocation of €23m. This will facilitate the continuation of the fee freeze into the second year of the scheme, ensuring that any potential increases in non-staff costs are not passed on to parents whilst supporting services sustainability.
My Department used the most recent data available to allocate Core Funding for year 2, with data emerging from current operations of services from March 2023 underpinning the recently announced allocation model, as well as the most up-to-date macroeconomic projections. More data will be available to my Department through the validated financial returns, which will be gathered in October 2023, and will allow further analysis of provider income and costs.
Additionally, early learning and childcare services are able to apply for the Temporary Business Energy Support Scheme (TBESS). Under TBESS, businesses engaged in early learning and childcare services who have suffered an increase of at least 50% in the average unit price of electricity and/or natural gas for the relevant billing period in 2022, as compared with the average unit price for electricity and/or gas for the corresponding reference period in 2021, are eligible under the scheme.
Services that are experiencing difficulty and who would like support are encouraged to contact their City/County Childcare Committee (CCC) to access case management supports. Services can be assisted on an individual basis through this route and it also allows for trends and themes across the country to be identified that can inform a more systematic response if necessary.
This is just the start of a multi-annual investment plan. Full implementation of all recommendations will be progressed in the coming years as additional funding is secured through the annual Estimates process. Officials in my Department are currently engaging in the Estimates process for Budget 2024, which will consider developments to Year 3 of the scheme.
Together for Better begins a journey that I am confident will see exceptional standards of early learning and childcare achieved, delivering Government commitments in Partnership for the Public Good, expanding the sector and growing capacity through public management and investment, and ensuring positive outcomes for children, their families, and society overall.
I am committed to increasing State funding for ELC and SAC as part of a multi-annual budget process and continuing to work with Partner Services delivering early learning and childcare for the public good.
