Dáil Éireann Debate, Tuesday - 16 April 2024
596. Deputy Robert Troy asked the Minister for Children, Equality, Disability, Integration and Youth how he intends to support child care settings with the additional cost of infrastructure by Government, the auto-enrolment for pensions, sick pays, and also from his own Department in relation to preparation of accounts in duplicate is leading to additional professional fees. [16446/24]
View answerInvestment in early learning and childcare is at unprecedented levels with public funding reaching more than €1.1 billion in 2024 – a clear demonstration from Government of the value of the sector.
The majority of this funding is allocated through Together for Better - the funding model for early learning and childcare, which brings together four strands, the Early Childhood Care and Education (ECCE) programme, including the Access and Inclusion Model (AIM), the National Childcare Scheme (NCS), Core Funding, and the Equal Participation Model, which is currently in development.
Core Funding is a payment to services designed to support quality, sustainability, and enhanced public management, with associated conditions in relation to fee control and cost transparency, incorporating funding for administration and to support the employment of graduate staff.
The base rates in Core Funding have been developed using the various components associated with the cost of delivery of service provision such as; staff pay and conditions, including contact and non-contact time, holiday pay, sick pay and other employer costs; administrative staff/time and non-staff overhead costs.
Some €259 million was allocated through Core Funding for year 1 of the Scheme. This allocation increased by 11% to €287 million, for the second year of operation. The breakdown of the additional €28 million of the Core Funding for Year 2 is as follows:
• An additional €8.47m is allocated towards funding the natural growth of the sector. This additional funding supports an increase in services; and in 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 helps services expand their businesses, which will lead to greater accessibility for parents and greater sustainability for services.
• An additional €6.11m 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 services, while continuing the fee management process that began in Year 1, which will further improve affordability for parents.
• An additional €2.2m 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.
• €4m was allocated to remove the year 3 experience requirement for the Graduates Premiums, underpinned by ERO.
In addition, a number of targeted supports for small and sessional services were introduced in Year 2 of the scheme in 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. These measures saw the average allocation under Core Funding for sessional-only service increase by 30% this year.
In a continued commitment to supporting these services, these targeted measures will continue to apply in the 2024/2025 programme year.
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.
With relation to the preparation of accounts, financial reporting requirements under Core Funding was a recommendation of the Expert Group in their report ‘Partnership for the Public Good’, who identified the need for robust data to underpin funding policy.
These essential data will inform the ongoing development of Core Funding, including preparations for the next Estimates process, ensuring Government can continue to make progress on objectives of affordable, quality, inclusive and sustainable early learning and childcare services.
Officials in my Department have, in recent months, engaged intensively with members and nominees of the Early Learning and Childcare Stakeholder Forum (ELCSF) in relation to Core Funding Financial Reporting Requirements. Arising from that engagement, transitional arrangements for financial reporting this year and next were agreed. For Year 1 and 2 of Core Funding, the Financial Reporting requirements consist of a completed Income and Expenditure Template, which needs to be submitted by services’ nominated accountant. There will be no requirement to submit audited accounts to Department for Year 1 and 2 of Core Funding.
It would not be feasible to receive different types of reports, at different times of the year, covering different time periods, as there would be no consistency in the information provided. Therefore, a sector specific set of nominal codes, the Core Funding Chart of Accounts, provides the necessary consistency of inputs, and the reporting period of September to August provides the necessary consistency of the reporting period and is in line with the funding year.
As my officials communicated previously, providers that experience difficulty in engaging an accountant to submit the completed Income and Expenditure template by the new deadline will have the option of submitting a draft Income and Expenditure template by 26 June 2024. Services that avail of this option will need to engage an accountant to submit a final Income and Expenditure template prior to them entering into Core Funding in Year 3.
My Department officials are now focusing on rolling out a suite of supports to providers to fulfil their financial reporting obligations under Core Funding, which will be delivered through local City/County Childcare Committees (CCC). These supports will include a once-off financial support for targeted services. Further details on these supports are outlined in a detailed FAQ which is available on the Hive.
In addition, 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.
I and my Department are committed to working with services delivering early learning and childcare for the public good.
