First 5, a whole-of-Government strategy for babies, young children and their families commits to increasing investment in early learning and childcare to up to €1 billion by 2028. A new funding model will be a key vehicle to ensure that such significant additional investment delivers for children, families and the State.
An Expert Group was established in September 2019 to develop a new funding model for the sector. The Group was tasked with examining the current model of funding, its effectiveness in delivering quality, affordable, sustainable and inclusive services and considering how additional resourcing can best be structured in order to achieve these objectives.
The Expert Group have met 21 times since late 2019. They have presented their report to me, and it is due to be submitted to Government shortly. Since the report is under consideration, it is not possible at present to share the full details of its recommendations but, subject to Government approval, it will be published in the coming weeks. In line with the Group's Terms of Reference, the recommendations will seek to further achieve policy objectives of quality, affordability, accessibility and contributing to addressing disadvantage through increased public funding and public management.
I have met with the Chair of the Group and was briefed on its progress, which allowed for the emerging recommendations of the Expert Group to significantly inform the developments being introduced in Budget 2022. Budget 2022 introduces a ground-breaking package of measures for the early learning and childcare sector - designed to deliver quality for children, affordability for parents, stability for providers, and support employers to improve pay and conditions for staff. An additional €78m in ELC and SAC funding brings the total investment in the sector to €716m next year.
The increase in funding comprises three main parts. Firstly, changes to the NCS will, inter aliam extend the NCS universal subsidy to all children under 15, as recommended by the Expert Group.
Secondly, the introduction of a new Core Funding stream in September 2022 will support providers cover increased operating costs linked to quality improvement measures. This core funding stream will be worth €69 million to providers in 2022 and approximately €207 million in a full year from 2023 on.
Thirdly, a one-off transition fund of up to €37 million will operate from May to August 2022, to support providers in the period leading up to the new core funding stream.
These new development measures announced in Budget 2022 begin the implementation of the Expert Group’s recommendations. The full implementation of the Expert Group’s recommendations is likely to be a multi-annual process, with funding becoming available on an incremental basis.
The development of the new funding model has been supported by a significant programme of research. The research partner of the Expert Group has produced a series of working papers examining Ireland’s approach to this sector in an international context including papers on reducing costs to parents and mechanisms to control fees. The Group has also engaged in an extensive and detailed stakeholder consultation process.
Material relating to the work of the Expert Group, including reports from consultation and engagement, meeting documentation and research papers are available on a dedicated website, www.first5fundingmodel.ie.