Brendan Griffin (Kerry, Fine Gael)
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379. To ask the Minister for Children, Equality, Disability, Integration and Youth his views on a matter (details supplied) regarding the employment wage subsidy scheme; and if he will make a statement on the matter. [34935/21]

Roderic O'Gorman (Dublin West, Green Party)
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The vision set out in First 5, the ambition of the Programme for Government, and the commitments made during the pandemic, signal the importance of the early learning and care and school-age childcare sector and the scale of the reforms underway.

First 5(published November 2018) sets out an ambitious programme of work across Government Departments to improve the experiences and outcomes of children in Ireland from birth to age 5 across all aspects of their lives in the coming ten years. One of the major building blocks of First 5 is additional public funding, strategically invested, to achieve the best outcomes for babies, young children and their families.

Since 2015, state investment in ELC and SAC has increased by an unprecedented 141%. This funding has been used to remove barriers to access so that children can enrol and meaningfully participate in high-quality early learning and care and school-age childcare. First 5pledges to further increase investment in ELC and SAC by 2028 in order to make further progress towards average OECD levels of investment.

In 2021, the ELC/SAC budget allocation of €638m for 2021, ensuring that 2020 funding levels are maintained. This allocation includes €289.3m under the Early Childhood Care and Education Scheme (ECCE), €205.5m under the National Childcare Scheme (NCS) and €35m under the Access and Inclusion Model (AIM). This allocation incorporates, among many other funding streams, the full year costs of the additional hours of subsidised income-based childcare introduced in September 2020. Moreover, the allocation covers the 7% increase in AIM capitation rates introduced in January 2021, aligning the scheme with current ECCE capitation rates, which were increased by 7% in September 2018.

First 5commits to at least doubling investment in early learning and care and school-age childcare between 2018 and 2028 and the new Funding Model will be a key vehicle to ensure that such significant additional investment delivers for children, families and the State.

An Expert Group was established in 2019 and tasked with the development of a new Funding Model to more precisely allocate public funding to deliver ELC/SAC services that align with national policy objectives, resourcing quality provision and delivering affordability for parents. The new Funding Model will ensure that the State leverages the maximum value from that investment. The intention is that the new Funding Model will operate in parallel with existing major funding programmes/schemes – the National Childcare Scheme and the universal pre-school Early Childhood Care and Education programme (ECCE) which provide full or partial subsidies to parents. The new Funding Model will therefore be the framework for additional investment in services in return for clear evidence of quality and affordability to ensure effective use of public funding.

The Expert Group is tasked with examining the current model of funding, its effectiveness in delivering quality, affordable, sustainable and inclusive services and considering how additional resourcing can be delivered for the sector to achieve these objectives, drawing on international practice in this area.

The Expert Group is independently chaired and includes national and international experts in ELC and SAC systems, funding, quality, economics, and relevant policy experts from the Government Departments who will be involved in implementing the new funding model.

The Expert Group has met 17 times to date, most recently on 23 June. Stakeholder consultation is ongoing with the Early Learning and Childcare Stakeholder Forum. It is expected that a report on the Group’s recommendations will be submitted to me in November 2021 for consideration before submission to wider Government.

The work of the Expert Group is updated at a dedicated website – www.first5fundingmodel.gov.ie. The Agenda and Minutes of each meeting are published, as well as other information relating to the project. All research commissioned and carried out by Frontier Economics is also published here, along without outputs from Consultation and Engagement.

I am committed to the further development of career pathways for those working in early learning and care and school-age childcare services. Establishing clear and supported career pathways is important both in improving recruitment and retention of staff, and in enhancing practitioners' continuing professional development, both of which support better outcomes for children.

Phase two of work on the Workforce Development Plan (WDP), which began in February 2021, involves the preparation of detailed policy proposals by a number of working groups, one of which is specifically looking at the career framework and career pathways. The final WDP report is expected to be published by the end of 2021.

Throughout the pandemic, a range of supports have been provided to the early learning and care and school-age childcare sector, including as the Deputy referenced, the Employment Wage Subsidy Scheme (EWSS). EWSS is an economy-wide enterprise support for eligible businesses in respect of eligible employees under the auspices of the Department of Finance and administered by Revenue.

To qualify for the EWSS, as well as having tax clearance, employers must be able to show that their business experienced a 30% reduction in turnover or customer orders over a defined period. However, Early Learning and Care and School-Age Childcare (ELC/SAC) employers registered in accordance with Section 58C of the Child Care Act 1991 are included in the EWSS with no turnover test.

The rate of subsidy employers receive per paid eligible employee under EWSS was revised on 20 October 2020 to a higher rate. As announced by the Minister for Finance on 1st June, these revised rates remain in place until end September 2021.

For Q3, there are no changes for qualification for EWSS for the childcare sector. The Government has approved the extension of the EWSS for Q4, however, it is considered too early yet to prescribe the precise operational parameters of the scheme that should apply for that quarter. An exit plan for EWSS will be announced in September 2021.

Work undertaken by my Department indicates that, further to the introduction of the revised rates, ELC/SAC services with EWSS are estimated to have approximately 80% of payroll costs covered. This equates to approximately 50% of the usual operating costs of these services.

The Programme for Government commits to supporting the establishment of a Joint Labour Committee (JLC) for the early learning and care and school-age childcare sector and the drawing up of an Employment Regulation Order. In December 2020, I began a short process to examine the possibility of regulating pay and conditions in the sector and the suitability of a JLC. In agreement with IBEC/Childhood Services Ireland, and SIPTU, Dr Kevin Duffy, former Chair of the Labour Court, was appointed to be the independent chair of this process.

On foot of Dr Duffy’s report, on 11 March I wrote to the Minister of State for Business, Employment and Retail, recommending the establishment of a JLC for the sector.

The Labour Court published its Draft Establishment Order for a Joint Labour Committee for Early Years Services on 27th April, for the purpose of public consultation. As part of this consultation process, the Labour Court held a public hearing on 28th May and on June 21st Minister English signed the Establishment Order for the JLC, which will take effect on July 1st. In line with the provisions of the Industrial Relations Acts, it is now for the Labour Court and the Minister of State for Business, Employment and Retail to determine the membership of the Joint Labour Committee for the sector.

The establishment of the JLC will provide a key mechanism for unions and employer representatives to work together to determine wages and working conditions in the sector, thus helping employers to recruit and retain staff, and recognising the value of the work done by ELC and SAC practitioners.

My Department has begun a focused and thorough examination of its financial requirements ahead of Budget 2022. The allocation sought by my Department will be designed to meet the ongoing needs of the early learning and care and school-age childcare sector. It is anticipated that both the work of the Expert Group and Workforce Development Plan will contribute to informing the Budget 2022 process.