Verona Murphy (Wexford, Independent)
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4. To ask the Minister for Children, Equality, Disability, Integration and Youth his views on the real concerns regarding viability under core funding within parts of the early childhood care and education sector; and if he will make a statement on the matter. [28436/22]

Verona Murphy (Wexford, Independent)
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I wish to ask the Minister his views and those of his Department on the real concerns regarding viability under core funding within parts of the early childhood care and education, ECCE, sector and to make a statement on that issue.

Roderic O'Gorman (Dublin West, Green Party)
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The new core funding system announced in budget 2022 amounts to €221 million in full-year costs. Of that, €173 million represents new investment. From the work we have done on this, we see no evidence that suggests services will face viability issues as a result of this significant increase in investment. However, I am engaging with representative groups to understand their concerns and will continue to do so.

The vast majority of services, including full-day, part-time and sessional services, will see a substantial increase in funding under the new scheme. A small percentage of services, about 1%, will not see an increase in funding. These services, which are primarily ECCE sessional services that are already on the higher capitation rate, are currently in receipt of some of the highest levels of public funding of at least €110 per hour of provision, with two adults required to be working with children under the ratios in place.

In addition to a funding guarantee that ensures no service will receive less under core funding, a new strand of the sustainability fund is being designed to provide an extra safety net for providers who have financial difficulties. This new sustainability fund will be open to both private and community providers.

Core funding is distributed in a fair and reasonable manner that is related to services' costs of delivery. Core funding intentionally addresses some of the existing disparities in funding approaches across ECCE and non-ECCE provision. The significantly increased investment through core funding provides a mechanism to control parental fees and improve pay and conditions for staff through supporting the drawing up of the employment regulation order, ERO. This will ensure that early years educators and staff are paid properly for the very important work that they do.

Every year a number of services close and others open. The current data on service closures and openings are not markedly different to the trend in previous years. Services close for a wide range of issues, such as retirements etc. Only a small minority close due to sustainability issues.

To conclude, the new funding model will benefit providers by improving the level and stability of funding, as well as deliver significant improvements for children, parents and staff.

Verona Murphy (Wexford, Independent)
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A lot of that sounds very positive but often the headline figures are used as indicators of Government support for particular areas and the true picture can only be seen when that breakdown of funding is examined in greater detail by those who will be able to avail of it or not, as the case may be. The headline figures do not in this case account for the variety of services being funded, nor do they show any shortcomings in funding for any particular services.

I would like to commend the work of Elaine Dunne, chairperson of the Federation of Early Childhood Providers, and many others on their tireless work and informing us. As my daughter is 27, I do not have a need for the service at this point in time but I see how important it is. The sector itself and people such as Elaine Dunne, who have a depth of knowledge, are worth listening to. At all cost, the Department should meet them to understand their roles. They have highlighted some shortcomings in service provision when it comes to comparing full day care and non-full day care.

Correspondence I have been provided with from the federation gets to the heart of the matter, when it stated it is acknowledged that full day care has higher staff ratios. I apologise; as the Minister also has this correspondence, he might just read through it.

Roderic O'Gorman (Dublin West, Green Party)
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I met the federation. Officials and I had a lengthy meeting with representatives from the federation. We are continuing to engage with the federation, which submitted a detailed document to us. We do not agree with all elements of it and we are working through it.

Core funding is about covering the costs of delivery. One of the key elements here is that as the sessional services, by their nature, have a shorter operating day and fewer numbers of hours per week, their costs of delivery are different to full day centre services. That is why when one does a full analysis of how much a full day centre costs, we are not just talking about big ones but about small community full day centres as well, they are by their nature going to get more from core funding because they are open more. They are open 48 or 49 weeks a year as opposed to 38. They are open 40 hours a week compared to 30. That is where that raw difference comes from. In terms of operating costs, we believe we are meeting the operating costs of providers.

Verona Murphy (Wexford, Independent)
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That is something that they would disagree with. That is why I would encourage the Minister to certainly keep talking with them. They have a range of optional extras that they put to him that can be implemented. I think the Minister will find that most of what parents want is quality first and availability second or both in tandem, absolutely. The reality is there are many hidden costs in childcare that nobody has accounted for and even parents do not consider. This includes the training and education that now goes into child carers and everything from insurance to the retention of staff. It is not just about how there are staffing shortages, but also the retention of staff. It primarily comes down to much of what Ms Dunne said is not being recognised as cost. As I said, core funding is there as a headline figure. However, when you delve into it, the problems surface. We can only understand and remedy it through the providers, just as how we can only build houses with developers.

Roderic O'Gorman (Dublin West, Green Party)
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The first year of core funding will be from September of this year. As this is a very significant investment, I ask services to give this a go and to work through this. It will be addressed and refined over the years but I genuinely believe this is the way to go and it will deliver the quality the Deputy spoke of. One of the greatest threats to quality is the staff leaving the sector and they are doing so because they are not sufficiently paid. Everybody recognises that. That is what the centre of core funding is about. Of the allocation, €132 million is dedicated directly to supporting services and paying staff extra, assuming that this ERO that is being negotiated at the moment is agreed. They have negotiated a base rate of €13 per hour, which is a living wage. It is the first time we will have a living wage for childcare professionals. That is what we are trying to achieve here, and it looks like it is about to be delivered. That is something very positive.

Verona Murphy (Wexford, Independent)
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It is very positive and I commend the Minister-----

Catherine Connolly (Galway West, Independent)
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I think the Deputy has been in twice.

Verona Murphy (Wexford, Independent)
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Have I? I apologise.

Catherine Connolly (Galway West, Independent)
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I think the Deputy has.

Verona Murphy (Wexford, Independent)
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I am overly enthusiastic.