Cormac Devlin (Dún Laoghaire, Fianna Fail)
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458. To ask the Minister for Children, Equality, Disability, Integration and Youth the action taken to support the childcare and early years sector since 27 June 2020. [62174/22]

Roderic O'Gorman (Dublin West, Green Party)
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Over the period 2020-2022, in addition to funding under my Department’s funding schemes, my Department and the State more broadly put in place a range of Covid-19 related supports for early learning and childcare services, estimated to cost €1 billion. The objective of these Covid-19 supports were to:

- support providers’ sustainability to enable services return to normal once restrictions were lifted;

- support providers to retain their staff;

- ensure that services could reopen and remain open, even at very low levels of occupancy;

- ensure that services could operate safely for children, families and staff;

- ensure that increased costs associated with public health requirements, and lower demand / occupancy were not passed on to parents; achieve administrative efficiency through the continued use of existing funding schemes and other whole of economy supports; and

- protect exchequer investment.

Supports in 2020 included:

- The continuation of funding under my Department’s schemes on an ex gratis basis (13 March - 5 April)

- The Temporary Wage Subsidy Childcare Scheme (6 April – 28 June 2020); which was layered on top of the Revenue operated Temporary Wage Subsidy Scheme (TWSS) and provided a top-up for wages of eligible early learning and childcare staff and a further payment to be used towards ongoing/non-deferrable operational costs such as rent, insurance and ICT.

- The Reopening Funding Package, (29 June – 23 August 2020), which included a once-off Reopening Support Payment (RSP), a once-off Covid-19 capital grant.

The table below shows the 2020 expenditure amounts for the sector across DCEDIY Covid-19 supports.

In 2021, my Department provided supports under the Covid-19 Operating Support Payment, the Playing Outdoor Grant and the Ventilation Grant, as follows:

In addition to these supports, the TWSS was estimated to cost €100m and the Employment Wage Subsidy Scheme (EWSS), was estimated to cost €632m. The EWSS:

- at enhanced rates from October 2020- January 2022 covered 80% of staff costs /50% of staff costs at a monthly cost of €34m per month.

- at standard rates, from August-September 2020 and February 2022 covered 50% of staff costs/38% of operating costs cost €22m per month.

- at flat rates, from March and April 2022, covered 25% of staff costs/ 11% of operating costs at a monthly cost of €11m per month.

There was other supports to the sector provided during the pandemic, including the PUP, the Restart Grant and the commercial rates waiver.

A transformative package of measures was announced in Budget 2022, increasing my Department’s funding allocation from €638m to €719m. This provided for a range of measures, including the introduction of Core Funding, enhancements to the NCS (i.e. the end in practice of deducting hours in pre-school or school from NCS hours and the extension of the universal subsidy to children under 15) and the temporary Transition Fund that was put in place to bridge the gap between the end of the EWSS and the introduction of core funding, which operated from May-August 2022, with expenditure of €23m.

A total of €1.025 billion was announced in Budget 2023 for early learning and childcare. This represents a €346m increase on last year’s funding and means the First 5 investment target of €1 billion by 2028 has been exceeded, five years ahead of target.

This €1,025 billion investment includes €266m to support continued implementation of the Core Funding Scheme for the first full programme year, September 2022 to August 2023 and into the next programme year from September 2023, with additional funding of €59m being made available to cover the costs of increased levels of capacity and numbers of graduates in year one and for a number of enhancements in year two of the Scheme.

Core Funding is designed specifically as a supply-side funding stream, paid directly to providers, related to the costs of delivery. Core Funding is based on operating hours, number of places offered by services, and the age group of children for whom the places are offered, given the staffing requirements determined by the regulatory ratios for different care categories, as well as allocations for graduate leaders in services. Structuring Core Funding primarily based on capacity means that Partner Services have an allocation each year that does not fluctuate in line with children’s attendance. Core Funding allows for substantial increases in the total cost base for the sector, related both to pay and non-pay costs, without additional costs being passed on to parents.

In addition to the continued support for the new funding stream, Budget 2023 saw €357.6m allocated for the continued implementation of the National Childcare Scheme (NCS), offering supports to a greatly expanded cohort of children and families at significantly higher subsidy levels– with additional funding of €121m ensuring the hourly universal subsidy under the NCS can increase from 0.50c per hour to €1.40 per hour from January 2023.

Funding in 2023 also provides €308.2m for the continuation of the ECCE programme that will benefit more than 108,000 children in 2023 and the continuation of the Access and Inclusion Model (AIM) to ensure more than 5,000 children with a disability can access and meaningfully participate in the ECCE Programme. €84.5m was allocated to support the delivery of a range of regulatory and quality supports for the implementation of the National Action Plan for Childminding, Nurturing Skills: the Workforce Plan, and the ongoing development of the registration and inspection system as well as policy development commitments set out in First 5and theProgramme for Government

My Department has allocated €9m for the Building Blocks - Improvement Grant for Early Learning and Care (ELC) and School Age Childcare (SAC).

Grants will range from €35,000 to €75,000 across two separate strands: Green Energy and Retrofit. The Green Energy Strand will support the Climate Action Agenda and the Programme for Government, which aim to transition to a carbon neutral economy by the end of 2050 and to reduce greenhouse gas emissions by 51% by 2030.

I will be announcing details of the Building Blocks - Capacity Grant in the coming months. This Grant will provide an investment of up to €45m for the expansion of existing provision and development of new provision.