Dáil Éireann Debate, Thursday - 26 May 2022
303. Deputy Kathleen Funchion asked the Minister for Children, Equality, Disability, Integration and Youth the total percentage of State spending and parental spending in 2020, 2021 and 2022 on early learning and care and school-age childcare in tabular form. [27064/22]
Amharc ar fhreagra311. Deputy Kathleen Funchion asked the Minister for Children, Equality, Disability, Integration and Youth the percentage of childcare agencies' income that is made up of fees. [27083/22]
Amharc ar fhreagraI propose to take Questions Nos. 303 and 311 together.
An Independent Review of the Cost of Delivering Childcare in Ireland, undertaken by Crowe in on behalf of my Department, was published in November 2020. The project was designed to provide a robust evidence base for the further development of high quality Early Learning and Care (ELC) and School-Age Childcare (SAC) in Ireland.
This Review found that approximately 40% of the total income to the sector comes from parental fees. The remainder came from State funding. This percentage was found to vary significantly across services. Many services rely entirely on State funding while others services rely exclusively on parental fees. In a sustainable service, it is expected that the income to services (from both parental fees and State funding) exceeds the costs of delivering services.
The income and costs data captured as part of the Review have underpinned the substantial Covid-19 supports secured including the exemption for employers in the ELC and SAC sector to the rule in the Employment Wage Subsidy Scheme (EWSS) of having to demonstrate the reduction in turnover that was required of other employers.
Data for this Review was collected prior to the Covid-19 pandemic so the analysis of the breakdown of services' income between State funding and parental fees does not take account of the special financial supports that were made available to the sector from March 2020.
However, data available through the Annual Early Years Sector Profile survey shows that fees have remained largely static since the onset of Covid-19. At the same time, numbers of children attending services have reduced. This may rebound as parental working patterns change.
My Department is committed to the importance of collecting high quality income and cost data. In 2021, a new supplementary income and costs survey was circulated to all providers alongside the Annual Early Years Sector Profile survey, administered by Pobal on behalf of the Department. In 2022, the income and cost survey has been incorporated in to the Sector Profile and I am pleased that 83% of services have already completed this. This up to date sectoral data will provide a strong basis to inform future policy development and investment decisions.
With regard to State spending in 2020 and 2021, it is important to note that these were distorted years, due to Covid-19 effects. Expenditure data in relation to the sector from my Department is as follows:
|
|
2020 |
2021 |
|
Original / Revised Allocation |
€590.9* |
€637,9 |
|
Expenditure |
€ 507.9m |
€ 593.5m** |
|
Notes |
*2020 was a revised figure |
** It is important to note that 2021 Expenditure figures are provisional and yet to be finalised |
As we are only partially through 2022, I cannot provide State spending, but can advise that the allocation in Budget 2022 was €716.7 million.
This expenditure data does not include, for example, expenditure on the EWSS, which has been available to ELC and SAC employers in the sector between August 2020 and April 2022. The EWSS at enhanced rates (from October 2020-January 2022) equated to €34 million per month for the ELC and SAC sector, covering on average 80% of payroll costs and 50% of total operating costs for providers. Standard EWSS (from August 2020-October 2020 and for February 2022) equated to €22 million per month , covering on average 50% of payroll costs and 38% of total operating costs for providers, and a flat rate of €100 from March-April 2022, amounting to €11 million per month, covering on average, 25% staff costs or 11% total operating costs. This expenditure data also excludes the Temporary Wage Subsidy Scheme (TWSS) that was operated by Revenue in 2020.
Given the significant distortion that occurred in the sector throughout 2020 and 2021, in terms of both income from fees with reduced attendance of children, and public income, with various exceptional funding arrangements in place, it is not possible to make robust estimates about the split in services’ income from public and private sources during this time.
Core Funding, with a total full year cost equivalent to €221 million, will be of particular interest with regard to the relationship between State investment and parental fees. Core Funding is the new funding stream to start a partnership between the State and providers to support delivery of ELC and SAC for the public good, for quality and affordability for children, parents and families.
Core Funding will introduce a fee freeze for the September 2022-August 2023 programme year. This will stabilise the fee levels and ensure the affordability benefits of the NCS and ECCE subsidies are felt by parents, particularly the new extension of the universal NCS payment to all children up to 15.
Core Funding will give providers a stable income source based on the nature of the service they deliver. A provider’s income will now consist of Core Funding, NCS and ECCE subsidies, and parental fees. Structuring Core Funding primarily based on capacity means that services will have an allocation each year that will not fluctuate in line with children’s attendance.
