Dáil Éireann Debate, Wednesday - 26 October 2022
138. Deputy Marian Harkin asked the Minister for Children, Equality, Disability, Integration and Youth the types of funding available to ECCE, sessional early years' services; the current financial viability of those services; and if he will make a statement on the matter. [53705/22]
Amharc ar fhreagraOn 15th September, I launched Together for Better, the new funding model for early learning and childcare. This new funding model supports the delivery of early learning and childcare for the public good, for quality and affordability for children, parents and families as well as stability and sustainability for providers. Together for Better brings together three major programmes, the Early Childhood Care and Education (ECCE) programme, including the Access and Inclusion Model (AIM), the National Childcare Scheme (NCS) and the new Core Funding scheme.
Under Together for Better, ECCE sessional services who operate for 15 hours per week over 38 weeks per year can avail of ECCE capitation at a rate of €69 per registered child per week plus Core Funding at a rate of €9.75 per child place per week. Core Funding is payable whether or not the place is filled. The statutory regulations that apply for ECCE sessional services allow for a ratio of up to 11 children per adult. The ECCE scheme rules allow for up to 22 children (and two adults) in a session.
Additionally, if a lead educator of an ECCE session is a graduate with a relevant qualification and the necessary experience, an additional amount of €66.60 will be paid to the service per week. If there is a separate manager who is a graduate with a relevant qualification and the necessary experience a further €66.60 if available to the service per week.
AIM provides further investment in ECCE. Under AIM, a fully qualified Inclusion Co-ordinator (InCo) in an ECCE service receives an increase in the rate of capitation payable to the service of €2 (pro-rata), per ECCE registered child per week. For the programme call 2022/2023 to date (October 2022), 53% (2,063) of services delivering ECCE receive capitation for InCos.
Additional capitation is also paid to ECCE providers under AIM Level 7 to support inclusion of children by reducing the adult-child ratio within the ECCE room. In January 2021, the payments increased by 7% from €195 per week to €210 per week. A further increase of 7% in September 2022 increased AIM Level 7 capitation from €210 to €240 per week. For the programme call year 2022/2023 to date (October 2022), 53% (2,079) services delivering ECCE were paid for additional assistance, with a number of these services receiving more than one additional capitation.
ECCE-only services across the country form an integral part of the early learning and childcare system. Their exact operations can vary but typically, they open to children for 15 hours per week, 38 weeks per year.
Since the programme began in 2010, various developments to the ECCE programme between up to 2022 (related to capitation, ratios and non-contact time/programme support payments), demonstrate an increase in income of up to 22.6% for services without a graduate lead educator and 22% for services with a graduate lead educator. The introduction of Core Funding on top of ECCE standard capitation means up to €866.25 per week is now available for a session without a graduate lead educator (34.3% higher than in 2010) and up to €932.85 per week is now available for a session with a graduate lead educator (24.4% higher than in 2010).
The funding model for sessional services is now primarily a combination of the ECCE capitation they receive per child registered with them, including AIM, and the Core Funding grant services receive based on the capacity of their service and the qualifications levels of staff, as well as any optional extras they may charge parents such as an additional 30 minutes. A number of models of ECCE services and their associated funding are presented here:
first5fundingmodel.gov.ie/wp-content/uploads/2022/07/Early-Years-Draft-EROs_Implications-for-ECCE-sessional-services.pdf
Under Core Funding, the overwhelming majority of services will see an increase in their funding, most will see very substantial increases, and no services will see a decrease in funding if their circumstances remain the same. ECCE services without a graduate lead educator will see capitation increase by at least 9.5% through Core Funding. ECCE services with a graduate lead educator will almost all see increases in income, although it may be smaller proportionally given the significant level of funding available under the old funding model.
A very small number of services, less than 100 of the over 4,000 signed-up, will see no increase with their income matched to 2021/2022. For this small number of services who do not experience an increase, a Funding Guarantee will apply. This will top-up Core Funding payments to match the difference in ECCE higher capitation and PSP from last year, provided they offer the same amount of graduate led provision as last year. These are larger ECCE-only services – with 20+ children in a session.
With regards to financial viability, there is no evidence that the new funding model will render ECCE services unsustainable. My Department has extensive data on providers’ existing and projected income and delivery costs through data from Revenue, surveys and demographic and macro-economic information and has extensively analysed the question of sustainability.
Data available prior to the additional investment of Core Funding in the sector showed that the median surplus (income in excess of cost) for sector as a whole of 4%. However, services with the characteristics correlated with ECCE-only provision had higher levels of surplus than other types of provision – ranging from 14% to 23% depending on the characteristic.
- Do not offer full day: 17% income in excess of cost
- Do not offer wrap-around care: 16% income in excess of cost
- Open exactly 38 weeks each year: 19% income in excess of cost
- Low total numbers of childcare hours: 23% income in excess of cost
- Single-site services: 14% income in excess of cost
- Those whose only income source is ECCE funding: 19% income in excess of cost
Separately Sole Traders, which constitute a large proportion of ECCE-only provision had an average income in excess of costs of 23%.
This evidence suggests that ECCE-only services had the highest levels of income in excess of costs compared to other types of provision.
The collection of information on income and costs is essential for the full understanding of this complex and diverse sector in order to inform the development of policy. As recommended by the Expert Group, there needs to be full visibility and understanding of financial information in the sector in order to better understand the impact and interaction of income, costs, surplus and profit in the sector.
I am pleased therefore that the recent data collection for the 2021/2022 Annual Sector Profile, including questions on income and costs, has been completed by 93% of services. This new and emerging data will allow the Department to rerun income and cost analysis and ascertain the latest available financial position to inform the next policy developments.
Budget 2023 allocates €1,025m to early learning and childcare – a clear demonstration from Government of the value of the sector. Further interrogation of the new Core Funding application and income and cost data is required in order to most effectively design developments in Year 2 of Core Funding.
For any services that are experiencing difficulty and who would like support can contact their City/County Childcare Committee (CCC) to access case management supports. Services can be assisted on an individual basis through this route and it also allows for trends and themes across the country to be identified that can inform a more systematic response if necessary. My officials are not receiving any indications from CCCs that there have been providers reporting financial difficulties and in need of support. This case management process through the CCCs is the route to access additional sustainability funding if required.
Together for Better aims to transform the sector and my Department and I are committed to working constructively, collaboratively and positively with Partner Services towards a goal of delivering early learning and childcare for the public good.
