Mr. Kevin McCarthy:

I thank the committee for the invitation to attend to assist it in its examination of the 2020 Appropriation Account of the Department of Children, Equality, Disability, Integration and Youth.

  I am joined by my colleagues Ms Carol Baxter, assistant secretary; Ms Anne-Marie Brooks, assistant secretary; Mr. Dermot Ryan, assistant secretary; Ms Laura McGarrigle, assistant secretary; Ms Lara Hynes, acting assistant secretary; and Mr. Gordon Gaffney, Mr. Andrew Patterson, Ms Ruth Mulligan, Ms Caitríona Mulhall and Mr. Aidan Madden.  In my opening statement, I will give a very brief overview of some of the main features of the Vote and main developments in 2020. The more detailed briefing document, which was supplied in advance of the meeting, sets out the estimated provisions, outturns and variance explanations for each of the subheads, along with further details on specific topics of procurement and international protection. I hope that will be of assistance to the committee in providing a fuller picture of the work of the Department and its expenditure.

As we all know, 2020 was an extraordinary year due to the Covid-19 pandemic. In common with all public bodies, the Department was forced to change the way we delivered services and rethink approaches to sustaining our objectives to enhance the lives of children and young people, adults, families and communities, recognise diversity and promote equality of opportunity. The year 2020 also saw a significant increase in both the size and responsibilities of the Department. On the formation of the new Government, it was decided to assign significant additional responsibilities to the former Department of Children and Youth Affairs. These included international protection, equality and disability policies, which transferred in from the Department of Justice as well as the Irish Human Rights and Equality Commission and the National Disability Authority.  The transfer brought almost 100 staff members and a substantial increase in funding to the Vote. Some minor youth justice areas transferred out at this time also to the Department of Justice.

Responsibility for education welfare functions, under Tusla, the Child and Family Agency, transferred to the Department of Education with effect from 1 January 2021. As part of the new disability remit, the transfer of responsibility for specialist community-based disability services from the Department of Health is due to be completed soon, following the recent passage of the relevant legislation and extensive preparatory work by both Departments and the HSE. This final transfer of functions will bring together key disability policy and service elements and result in a major increase in the Department’s Vote.

In summary, following the changes announced by the incoming Taoiseach in 2020, the Department retained virtually all of the responsibilities of the Department of Children and Youth Affairs as well as assuming significant additional functions in relation to equality, integration and international protection. The reconfigured Department therefore closed the year with five programme areas, which encompass child protection and welfare, prevention and early intervention, adoption, family supports, early learning and childcare, youth services and youth justice, as well as equality, integration, international protection and disability policy.

Turning to the Vote, the total provision for 2020 was €1.837 billion. In terms of overall composition, the majority of this was focused on three areas: Tusla, the Child and Family Agency; early years care and education; and international protection seekers' accommodation. The current expenditure provision was €1.796 billion, with a further €41 million allocated to capital expenditure. The net provision was €1 billion when appropriations-in-aid of €36.5 million are taken into account. The outturn for the Vote was €1.677 billion, with a surplus of €123 million, of which €4.1 million was deferred.

The major factor impacting the level of activities and expenditure in 2020 was the Covid-19 pandemic. Delayed recruitment, cancelled travel, reduced capital expenditure and service closures impacted on spending on schemes such as early childhood care and education, ECCE, and the access and inclusion model, AIM, as well as on international protection services as a result of slowed migration of international protection seekers. On the other hand, the response to the pandemic necessitated additional spending allocations to the Child and Family Agency of €8 million and to Covid-related supports for providers in early learning and care and school-age childcare to a value of €109.5 million. These additional supports were funded from savings realised within the Vote.

The largest savings were realised in two areas, the first being under programme E, international protection seekers' accommodation, which finished the year with a surplus of €17.4 million, or 9% of its 2020 provision. Some increased costs were incurred in ensuring compliance with public health requirements during the pandemic, offsetting some of the savings.

The second area of significant underspend was within the three combined early learning and care subheads in programme B, which incorporates the ECCE and AIM childcare schemes as well as the national childcare scheme. There was an underspend of €55.6 million or 12% of the €480.8 million in these areas. The biggest factor was the closure of the national childcare scheme for 12 weeks and the lower than anticipated uptake of the scheme once it reopened, as well as the suspension of the ECCE and AIM schemes. It should be noted that a large portion of the early learning and care subhead’s original provision was reallocated to Covid-related spending in the sector in the form of specific supports.

I acknowledge the significant efforts of staff across the Department, our agencies and the wider sector in managing the impact of Covid-19 in 2020. The early learning and care sector and Tusla were particularly impacted in differing ways. It is to its strong credit that Tusla continued to deliver critical front-line services throughout the pandemic. In the early learning and care sector, the Department moved quickly to put in place supports to sustain the sector and retain capacity to the greatest extent possible during periods of service closure and reduced demand, working with the sector to ensure sustainability and protect services and service affordability for parents. The Department worked closely across Government and with sector representatives to develop and target supports that aligned with wider initiatives such as the temporary wage subsidy scheme, along with capital and reopening support packages. Other areas within the Vote also responded to the unique challenges presented by the pandemic, including international protection, youth justice and youth services.

As we emerge from these pandemic-related challenges, the Department faces new challenges that are again unprecedented in nature and scale. I refer to the effects of the war in Ukraine, which has precipitated a humanitarian crisis and impacted enormously on the work of the Department over the past three months through our efforts to provide safe shelter and accommodation to those who have come here in crisis in their many thousands under the EU’s temporary protection directive. The responsibility for making immediate accommodation arrangements for those seeking it falls to our Department under our international protection responsibilities.

We are happy to play our part in meeting the needs of displaced Ukrainians seeking asylum. The increased scale, pace and unpredictability of demand for accommodation has posed major challenges which continue to be managed on a daily basis. As of 31 May, 23,894 beneficiaries of temporary protection have sought accommodation through our service. All available avenues of additional short-term accommodation have been and are being explored in seeking to increase available capacity to meet this demand. We have had to move quickly to build internal teams to manage the response in all of its aspects, through reassigning staff from other roles and bringing in additional support where we can. We have relied heavily on the support of local authorities in meeting immediate emergency accommodation needs as they arise and taken all necessary urgent actions to ensure that the daily requirements of managing the unprecedented inflow of people involved can be met. We will continue to seek to respond to this crisis as it evolves over the coming weeks and months and this will have a significant impact on costs in the Department’s Vote in 2022 and beyond.

I pay tribute to my colleagues in the Department for their response to the huge demands of the current crisis and for the wider contributions they have made in continuing to deliver on a range of objectives since the beginning of the Covid-19 pandemic in 2020. I thank the Chair and members for their attention and am happy to take questions.