Neale Richmond (Dublin Rathdown, Fine Gael)
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426. To ask the Minister for Children, Equality, Disability, Integration and Youth if his attention has been drawn to the fact that many childcare providers find the current rates for the early childhood care and education scheme to be untenable and insufficient to allow providers to make ends meet; the steps he is taking to address same; and if he will make a statement on the matter. [44667/21]

Roderic O'Gorman (Dublin West, Green Party)
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The Early Childhood Care and Education (ECCE) Programme is a universal free two-year pre-school programme available to all children within the eligible age range. The Programme is provided for three hours per day, five days per week over 38 weeks per year (i.e. from September to June).

Following a 7 per cent increase in 2018, the capitation rates for the Programme are €69 per child per week, with a higher capitation rate of €80.25 per child per week where the ECCE programme is provided by a practitioner with a relevant qualification of level 7 or above. There is a separate payment (Programme Support Payment) towards the cost of administering the Programme.

An independent review of the cost of providing quality early learning and childcare (ELC) in Ireland, which was undertaken in 2018, estimated an average hourly unit cost of €4.14 for delivering ELC across all services. This compares with hourly capitation rates for the ECCE Programme of €4.60 (standard capitation) and €5.35 (higher capitation).

While these findings on unit cost suggest current levels of ECCE capitation are sufficient, I am acutely aware that the unit cost can vary across service type and location. The unit cost is also based on pay rates, which are unacceptably low.

In line with a commitment in First 5 to at least double investment in ELC by 2028, work is underway to develop a new funding model for the ELC sector. This funding model will be the vehicle to ensure additional funding allocated to the sector further reduces out of pocket costs to parents, ensures a range of additional supports can be provided to children from disadvantaged groups, compensate providers so that they can deliver ELC on a sustainable and high-quality basis and attracts and retains a well-qualified workforce. An Expert Group is leading the development of this new funding model and is on track to report in November.

In the meantime, providers offering the ECCE programme, as with all ELC providers, are currently eligible to receive the employment wage subsidy scheme (EWSS), without having to show a drop in turnover of 30% as is required in other sectors of the economy. My Department has calculated that the EWSS at enhanced rates covers on average 80% of staff costs, or 50% of total operating costs.

A Covid-19 Impact Support Scheme is also available for ELC providers who require further financial assistance in addition to current financial supports available.

The purpose of the Covid-19 Impact Support Scheme is to support the sustainability of ELC services who may be left with short-term sustainability concerns due to lower attendance or higher costs arising from Covid-19. Funding is provided to successful applicants that have experienced an income/expenditure deficit in respect of the ELC aspect of their business/organisation and do not have sufficient funds in reserve to absorb this deficit. This funding is available on a rolling basis until 31 December 2021. Any service that has concerns about their viability should contact their local City/County Childcare Committees (CCC) for further information on this Scheme.