Niall Collins (Limerick County, Fianna Fail)
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553. To ask the Minister for Children, Equality, Disability, Integration and Youth if he can advise on matters raised in correspondence by a person (details supplied) in relation to rural preschools; and if he will make a statement on the matter. [17839/22]

Roderic O'Gorman (Dublin West, Green Party)
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Core Funding is a new funding stream for Early Learning and Care (ELC) and School Age Childcare (SAC) services introduced in Budget 2022 and informed by the work of the Expert Group to develop a new funding model for ELC and SAC, outlined in Partnership for the Public Good: A New Funding Model for Early Learning and Care and School-Age Childcare.

Core Funding is a payment to providers designed to support quality, sustainability, and enhanced public management, with associated conditions in relation to fee control and cost transparency, incorporating funding for administration and to support the employment of graduate staff. Core Funding aims to offer better financial sustainability to providers in return for a cultural shift to a partnership relationship between providers and the State that reflects the public good dimension of ELC and SAC.

On 7th March I announced the rates and values for the Core Funding, and launched the online Ready Reckoner tool. The Ready Reckoner is accessible to all and is designed to give an idea of what services can expect to receive based on their characteristics. It also allows different scenarios of provision to be tested. This will show the benefits of applying for Core Funding when it is possible to do so.

Where providers are experiencing difficulties completing the Ready Reckoner, I would encourage them to engage with their local City/County Childcare Committee (CCC) who can provide support.

The majority of Core Funding (i.e. €183 million of the €221 million) will be distributed based on a service's capacity - opening hours, opening weeks and the age group of children for whom services are provided as well as number of places available. This €183 million includes allocations for improvements in staff pay and conditions (€138 million), for administrative staff/time (€25 million), and a contribution to non-staff overhead costs (€20 million). The rationale for distributing Core Funding based on capacity is that capacity encompasses the primary characteristics that determine the service's costs of delivery. Structuring Core Funding primarily based on capacity will support sustainability and stability for services, since they will have an allocation each year that will not fluctuate in line with children's attendance.

In addition to the €183 million allocated on the basis of capacity, a further €38 million is allocated to contribute to support graduates to be Lead Educators across ELC and to support graduates as Managers in ELC or combined ELC and SAC services. Heretofore funding has only been available in respect of graduate Room Leaders in the Early Childhood Care and Education (ECCE) programme.

Services whose provision is led by a graduate will receive this Graduate Premium, on top of their other funding. The Graduate Lead Educator Premium in Core Funding is paid as a top up on the number of hours of provision that is led by a graduate with a relevant qualification and three years' experience. The Graduate Manager Premium is paid as a top up on the number of hours of operation of a service whose manager is a graduate with a relevant qualification. An ELC Graduate Manager who also works as a Lead Educator can only attract one graduate premium.

Core Funding will address some of the existing disparities in funding levels across ECCE and non-ECCE provision, providing funding proportionate to the age ratio of children being cared for and supporting the employment of graduate Lead Educators across ELC provision. While Core Funding will operate in addition to and alongside ECCE (standard capitation), AIM, CCSP and NCS, it replaces ECCE higher capitation and incorporates funding previously allocated to the discretionary Programme Support Payments (PSP), with an increased allocation, from September 2022.

The significant majority of ELC and SAC services will see substantial increases in income through Core Funding. It is important to state that no service will lose out because of Core Funding.

My Department has issued a funding guarantee to providers. All services will receive at least the same level of funding in Core Funding as they received from higher capitation and PSP in the 2021/22 programme year, assuming the numbers of children, graduate staff and type of service offered remains the same

Services for whom the Funding Guarantee will apply and those who will see just small increases from Core Funding are ECCE services in receipt of higher capitation for large groups of children and with high occupancy levels. Such services are currently in receipt of the highest levels of public funding relative to the staffing levels required for operating those types of services, €110-€120 per hour of service provided, substantially in excess of the average staffing costs for this type of provision.

The level of investment being made available for Core Funding is an acknowledgement that high quality ELC and SAC costs more than the current income to the sector and that this additional investment is best allocated by linking the quantum of funding to services with their underlying costs of delivery.

This is the start of a multi-annual investment plan and is part of Government’s commitment to realising the First 5target of investment of approximately €1 billion by 2028. First 5and Core Funding recognise that the workforce is at the heart of high-quality ELC. Strong international evidence shows that children achieve better outcomes when staff are well qualified. First 5 seeks to continue to build an appropriately skilled and sustainable professional workforce, and includes a commitment to achieve a graduate-led workforce by 2028. Core Funding introduces a strategic way of funding the sector and begins to implement the recommendations of the Expert Group to develop a new funding model.