Emer Currie (Dublin West, Fine Gael)
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As this is my first time to speak in the House, I express my sincere gratitude to the people of Dublin West who have given me the honour of representing them - I will work every day to show them it was the right decision - to my supporters, who showed up for me day in and day out, and to my family: daddy, who is watching from his armchair in heaven surrounded by newspapers, my mum, the most tolerant politician's wife and now politician's mother in the world, and my husband and daughters, who are quickly following in their footsteps.

A total of 262 childcare services in Fingal signed up to core funding this year. As of 13 January, 37% of those services applied for a fee adjustment if they were charging below the county average and struggling with increased operating costs. A total of 17% have been approved for a fee increase and 34 decisions remain outstanding. At least 45 services have already increased their fees across Fingal, which has been passed on to hundreds of parents who bought into and benefited from the increase in subsidies under the national childcare scheme last year, who felt a reduction in their household bills in September, only to see it or a portion of it wiped out. The number in the Dublin city area is similar. Approximately 17% of core funding services will see an adjustment, so 17% of families will see an increase of some sort in fees. Both of these administrative areas are relevant to the people I represent in Dublin West.

Will the new Minister for children, Deputy Foley, now correct this flawed approach and make good on the pledge to further reduce childcare fees for all parents as per the new programme for Government commitment to review and increase core funding?

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I welcome the Government's commitment to review and increase core funding. I believe that at this point it is essential for the sustainability of the sector. The cost of staffing, for example, has increased significantly since the 2019 fee freeze. Payscales will continue to grow, I hope, and a number of providers' fees predated 2019. Not every childcare provider is the same, especially those who have scale and shared resources on their side. I appreciate the approach must be dynamic.

I will take this opportunity to welcome the commitment to reduce the administrative burden on providers. Our childcare providers should be doing what they do best, which is educating and caring for our children and not spending most of their time as auditors of national schemes. Our local childcare services require adequate funding to stand still and to grow, and parents should be able to access affordable fees.

The work of the review must start today, based on the increases these parents are experiencing. One parent told me her fees have increased by €80 per month since September and they will increase again. Another said the additional cost this month is €250 as the crèche is backdating fees, and it will be an additional €140 per month. Other families are fearful of impending decisions and want clarity from the Government. We need further analysis of the range of adjustments to understand the impact on parents and assist them through the process. There is confusion and we need to understand this. I have seen the correspondence shared with parents on fee increases. Reassurance from the Department that an increase in childcare subsidies will mitigate fee increases, instead of reducing overall household bills, is very different and not what our stated objective was.

Hildegarde Naughton (Galway West, Fine Gael)
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I congratulate Deputy Currie on a personal level on her election in Dublin West. I know how passionate and hard-working she is. It is great to see her rewarded and sitting in Dáil Éireann today. I know her family are very proud and, in particular, I know her father would be very proud of what she has achieved. I look forward to working with her. I am taking this Topical Issue on behalf of the Minister, Deputy Foley, and I will raise the issues Deputy Currie has raised directly with the Minister. They are very important for us as a Government and we look forward to working with Deputy Currie.

I thank Deputy Currie for raising this very important issue and for offering me the opportunity to respond. I know from her time in the Seanad, and now representing the constituency of Dublin West in the Dáil, that the cost of childcare is one she has been raising consistently and one she is very passionate about. By way of background, core funding represents a significant increase in income for services and allowed for the introduction of the fee management system in line with the recommendations of the expert group in the Partnership for the Public Good report.

The first step in introducing fee management was to limit increases in fee rates, which in years one and two was effectively a fee freeze, whereby providers could not increase the fees charged from September 2021. Core funding has allowed for substantial increases in the total cost base for the sector, related both to pay and non-pay costs, thereby creating the conditions for this. This effective fee freeze ensured the increases to the national childcare scheme universal subsidy in 2023 were fully felt by parents in corresponding reductions in out-of-pocket costs.

In recognition of the notable difference in fees charged across the sector, and given that some services may have been operating with a fee that was not sufficient to sustain the business, even with increased State investment through core funding, a fee increase assessment process was introduced in year three of the programme. The fee increase assessment process balanced the need of parents for stability in their early learning and childcare costs and the need for providers to operate viable businesses in order to continue providing this public good service for their community.

The fee increase application process opened on 31 July 2024. Only services charging fees below the average in their county were eligible to apply. There was an assessment to ensure there was a demonstrable need for a fee increase before approval was granted. Where a demonstrable need to increase a fee was confirmed, the resulting increase did not exceed 74 cent per hour, and the maximum weekly increase was €33.30, which was equivalent to the increase to the national childcare scheme subsidy from September 2024. For example, a place offering 45 hours was eligible for a maximum increase of €33.30 while a place offering 20 hours was eligible for a maximum increase of €14.80. The process closed for applications on 29 November 2024. Only services charging low fees, those being fees below the average in their county, were eligible to apply. For example, if a service offered five fee options and one fell below the county average, only the one fee below the county average was eligible to enter the assessment process. The onus was on the provider to demonstrate a need for a fee increase.

Where parents may be seeing an increase in their fees as a result of this process, those in receipt of the universal subsidy, for example, will not see an increase in out-of-pocket costs compared to this time last year because of the maximum increase allowable under the process. For parents on the universal subsidy using the full hours offered, fees are not increasing beyond the level charged in September 2022, when core funding was introduced. These parents will have been paying some of the lowest fees in the country. As well as the fee increase process, a cap on fees was introduced for services joining core funding for the first time in the third year. A fee cap will apply to all services in core funding from September 2025. This change will improve affordability for parents, as very high fees will be reduced.

Emer Currie (Dublin West, Fine Gael)
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I thank the Minister of State for taking this on behalf of the Minister, Deputy Foley. I believe I understand the parameters by which the fee adjustment has been operated but I still feel there is a difference between using the subsidies to mitigate fee increases and reducing the impact on individual families and the real cost of their childcare. A 25% reduction in childcare fees in the household budget in 2023 was meaningful but the 50% reduction last September was significant. We should still honour this. We should examine it in advance of, or along with, the more transformative reforms we have in the programme for Government. I do not think we should leave 17% of families behind in terms of the full scope of subsidies and the impact on the household budget they would provide. For the purposes of today, I am focused on the need to review and increase them initially.

We have stated that there is a commitment to work in partnership with private providers, most of whom are women providing local services that families truly value and depend on. We also need to go beyond our near total reliance on private providers so that all communities have access to services, developing a system of forward planning and the delivery of appropriate childcare infrastructure capable of meeting demand. For now, childcare services need to be funded fairly in order to be viable operations, and parents need the most affordable fees we can provide.

Hildegarde Naughton (Galway West, Fine Gael)
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I thank Deputy Currie. Her passion for this issue has been very clear throughout her contributions this morning and previously. I will relay the points she has raised to the Minister, Deputy Foley, who has responsibility for this area. The introduction of core funding in 2022 brought a significant increase in investment for the sector of €259 million, paid directly to services in the first year of the scheme, of which €210.8 million was entirely new funding. Now in its third year of operation, core funding is worth €331 million. The increases implemented from September last year facilitate increases in the base rate for all age groups. The strengthening of targeted measures was introduced in 2023 to support sessional and smaller services and growth in the sector. Fee management was introduced, with the substantial investment of core funding, following the recommendations of the expert group in the Partnership for the Public Good report.

For Deputy Currie's information, a total of 1,147 services submitted applications to the fee increase assessment team in 2024. As of 5 February 2025, a total of 1,098 decisions have been issued to eligible services. Additionally, of the 1,147 applicants, a total of 811 have been approved to increase at least one fee, which equates to a success rate of 73.86%.

Parents and guardians and their children can only avail of the benefits and protections that core funding creates, such as the effective fee freeze, at 2021 levels, if their service has chosen to participate in the scheme as a partner service. It is a matter for providers to decide whether they wish to withdraw from the core funding scheme, the significant financial supports it provides to providers and the certainty it provides to parents through the associated fee management measures. However, the Minister, Deputy Foley, is confident that given the level of investment and the associated supports, services should not need to take this step. While a provider may withdraw from core funding, they will remain eligible in the programme year to provide the national childcare scheme, the early childhood care and education programme and the community childcare subvention plus saver programme.