Dáil Éireann Debate, Tuesday - 5 December 2023
488. Deputy Kathleen Funchion asked the Minister for Children, Equality, Disability, Integration and Youth the estimated first, full year and annual cost of increasing the current minimum rate of pay for early years educators, by 85 cent, €1.00, €1.25, €1.50, €1.75 and €2.00; and the first, full year and annual cost estimated cost to increase all other grades covered by the early years employment regulation order. [53690/23]
View answerI firmly believe the level of pay for early years educators and school-age childcare practitioners should reflect the value of their work for children, families, society and the economy.
The State is not the employer and therefore does not set the pay or conditions for employees in either early learning and care (ELC) or school-age childcare (SAC) services.
However, there is now, through the Joint Labour Committee (JLC) process, a formal mechanism established by which employer and employee representatives can negotiate minimum pay rates for ELC and SAC services, which are set down in Employment Regulation Orders (EROs). This is an independent process from the Department and neither I, nor my officials, have any role in the proceedings of the JLC and any associated negotiated minimum pay rates, the cost of which is borne by the employer.
Among other objectives, Core Funding supports the ability of service providers to meet the additional costs resulting from the EROs for Early Years Services, which came into effect in September 2022, as it provides increases in funding to early learning and childcare service providers to support improvements in staff wages, alongside a commitment to freeze parental fees.
On the basis of 2022 data supplied by Partner Services taking part in the Core Funding scheme, the estimated annual costs to employers of raising all the minimum pay rates specified in the EROs (for different grades and qualification levels) by the rates proposed in the question (making assumptions specified below in relation to equivalent increases for other roles specified in the EROs) are set out in the table:
|
Pay increase |
Estimated additional cost to employers |
|
€0.85 |
€35 million |
|
€1.00 |
€40 million |
|
€1.25 |
€51 million |
|
€1.50 |
€63 million |
|
€1.75 |
€77 million |
|
€2.00 |
€89 million |
In relation to the estimates above, the following should be noted:
- The cost estimates are based on staff who had an hourly wage recorded in service providers’ submissions for Core Funding, but the Core Funding data has been extrapolated to provide an estimate for all staff working in the sector.
- Current wage data was initially provided by service providers in August 2022, before the EROs for Early Years Services came into force, but has been adjusted upward on the assumption that all staff now earn at least the legally-binding minimum rates of pay specified in the EROs.
- The cost estimates are for the additional cost to employers of bringing staff from their current (since August 2022) wage or the minimum pay rates set out in the EROs, whichever is higher, up to a pay rate of €13.85 per hour (and then by each increase listed) or €0.85 (and then by each increase listed) above each of the minimum pay rates in the EROs.
- Calculations are based on wage-data available at a point in time. Some services may have increased wages more recently, which would reduce the cost to services of moving from current wage-rates to the proposed wage rates in the question.
- The cost estimates only relate to staff and managers covered by the current EROs, i.e. the estimates exclude the cost of ancillary staff.
- The cost estimates do not attempt to account for the potential cost implications for the wages of staff who are currently earning more than the increased rates above current ERO minimum rates.
- It should be noted that the figures in the table are the additional cost to employers, rather than the additional costs to the State. Core Funding offers a contribution to staff costs. The €287m allocated for Core Funding may already support some employers to pay wage rates above ERO minimum rates.
- The figures in the table do not take into account the income currently received by those working in the sector who are self-employed and who derive their income from profits rather than wages.
