Dáil Éireann Debate, Tuesday - 13 February 2024
530. Deputy Cormac Devlin asked the Minister for Children, Equality, Disability, Integration and Youth to provide an update on the escalating costs crisis facing crèches and childcare operators in the country; what measures will be taken to address this issue; and if he will make a statement on the matter. [6250/24]
View answerInvestment in early learning and childcare is at unprecedented levels with public funding exceeding €1.1 billion in 2023 for early learning and childcare – a clear demonstration from Government of the value of the sector.
The overwhelming majority of this funding is allocated through Together for Better, the new funding model.
Together for Better brings together four strands, the Early Childhood Care and Education (ECCE programme), including the Access and Inclusion Model (AIM), the National Childcare Scheme (NCS), and Core Funding, with a fourth programme, the Equal Participation Model in development.
The new funding model has been broadly welcomed by sectoral representative organisations who the Department meet with regularly through the Early Learning and Childcare Stakeholder Forum.
One of the key objectives of Core Funding is to support the sector as a whole with the introduction of direct supply-side funding, in addition to the ECCE programme and the NCS, to create a more stable and sustainable financial environment.
Core Funding improves:
- affordability for parents by instituting a fee freeze in participating Partner Services;
- access by expanding the capacity being offered by the sector, particularly for younger children;
- quality including through improved pay, conditions and career structure underpinned by Employment Regulation Orders; and
- stability and sustainability for providers.
Core Funding makes a significant additional contribution to services’ income, allowing them to better absorb increased costs including energy costs. In Year 1 of Core Funding, some €259 million was allocated under the scheme and 99% of services saw their income increase through Core Funding with 1%, or close to 60 services, receiving top up payments to ensure their income did not decrease for the same level of provision offered.
For the second year of operation, Core Funding increased by €28 million or 11% increase to €287 million. The breakdown of the additional €28 million of the Core Funding for Year 2 is as follows:
- An additional €8.47 million is allocated towards funding the natural growth of the sector. This additional funding will support an increase in more Partner Services; and also more staff working in the sector, more rooms and places, and more graduate lead educators and managers. By providing additional funding for capacity in this way, year 2 of Core Funding will help Partner Services expand their businesses, which will lead to greater accessibility for parents and greater sustainability for services.
- An additional €6.11 million is allocated towards non-staff overheads. This additional funding is a contribution towards non-staff overheads in recognition of the increase in non-staff costs faced by all services throughout the sector. This enhanced level of funding is aimed at increasing the sustainability of Partner Services, while continuing the fee management process that began in Year 1, which will further improve affordability for parents.
- An additional €2.2 million is allocated towards administrative staff time. This additional funding is a contribution towards administration in recognition of the fact that the number of children registered on ECCE and NCS is anticipated to continue to grow in 2023/2024. Non-contact/administration time is also factored into the base rate through the staff costs component.
- €4 million is allocated to remove the year 3 experience requirement for the Graduates Premiums, underpinned by EROs.
- €7.22m is allocated for new targeted supports for small and sessional services iin order to improve sustainability of these services, specifically a flat rate top up of €4,075 for sessional-only services and a minimum base rate allocation of €8,150
In a continued commitment to supporting these services, these targeted measures will continue to apply in the 2024/2025 programme year.
Through ECCE capitation and Core Funding combined, services receive a minimum of €79.20 per child per week and a maximum of €95.85 with additional funding for graduate lead educators and graduate managers and sessional only services will also receive an additional sessional only flat rate of €4,075.
The €287 million Core Funding scheme allows for substantial increases in the total cost base for the sector, related both to pay and non-pay costs thereby creating the conditions to introduce fee management. It is reasonable and justifiable that on receipt of Core Funding, services must agree not to increase their fees given the level of funding available.
Arising from Budget 2024, the Core Funding allocation for year 3 of the scheme will increase by 15% - to €331 million. This will support the delivery of a range of enhancements in Year 3 of the scheme to support improved affordability and accessibility for families, improved pay and conditions for the workforce and improved sustainability for providers.
- €9.27m will support a 3% increase in capacity in the sector in year three of the scheme, driven both by new services joining the sector and existing services offering more places and/or longer hours to families;
- The allocation for administration will increase by €3.21m; and
- The allocation for non-staff overheads will increase by €10.07m to ensure the Scheme continues to keep pace with cost pressures facing services.
- The remaining €21.49m will be used for other developments, to be informed by the emerging data from Year 2 of the scheme as well as the Financial Returns.
Special supports are available from my Department where a service is experiencing financial difficulty or has concerns about their viability, accessed through local City or County Childcare Committee (CCC).
This support can take the form of assisting services with interpreting analysis of staff ratios and cash flow, as well as more specialised advice and support appropriate to individual circumstances.
I would encourage any service experiencing financial difficulty and who would like support, to contact their City/County Childcare Committee (CCC) to access case management supports. Contact details for their local CCC can be found at www.myccc.ie .
