Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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475. To ask the Minister for Children, Equality, Disability, Integration and Youth if he will remove the requirement for childcare providers to provide a separate set of financial records to the ones filed with the Revenue Commissioners in the core funding model (details supplied); and if he will make a statement on the matter. [53433/23]

Roderic O'Gorman (Dublin West, Green Party)
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Core Funding, which commenced in September 2022, is a grant to Early Learning and Care (ELC) and/or School Age Childcare (SAC) providers towards their operating costs. Its primary purpose is to improve pay and conditions in the sector as a whole and improve affordability for parents as well as ensuring a stable income to providers.

All Partner Services that had an active Core Funding Contract during the 2022/2023 Programme Year must provide validated Financial Returns as per their Core Funding Partner Service Funding Agreement.

Core Funding payments to providers must run on a programme year, September-August, in line with the school year, the operation of the ELC and SAC sector, and the payments made to providers under the other DCEDIY schemes. Therefore, the financial returns cover the period from 1st September 2022 to 31st August 2023 and must be submitted by an accountant from a registered practice or a registered professional body (ACA, ACAA, CPA, and CIMA), on behalf of each Partner Service.

My Department is not requesting audited accounts, Partner Services are instead being asked to provide financial information mapped to the Core Funding Chart of Accounts, which has been reviewed, signed off and submitted by an accountant.

Services that already use accountancy packages should be able map to the Core Funding nominal codes from the Chart of Accounts. However, if a service does not use an accountancy package, a series of resources have been designed to assist services with meeting this requirement.

My officials have, in recent weeks, engaged with the Early Learning and Childcare Stakeholder Forum (ELCSF) on issues raised by providers on the financial reporting requirements under Core Funding.

To date, three meetings have taken place on 7th, 20th November and on 27th November involving members and nominees from Childhood Services Ireland (CSI), Childminding Ireland, Early Childhood Ireland (ECI), the Association of Childhood Professionals Ireland (ACPI), the Federation of Early Childhood Providers (FECP), the National Childhood Network (NCN), the National Community Childcare Forum and Seas Suas as well as representatives from City/County Childcare Committees (CCC) and Pobal.

Arising from these meetings, officials have developed and discussed proposals to significantly simplify and streamline the reporting requirements under Core Funding and to support providers in preparing and submitting these returns. They are now in the process of finalising updated financial reporting requirements and templates, which will be shared with members and nominees of the ELCSF in advance of publication. Once finalised, updated financial reporting requirements will be shared with providers and all communications, including templates and training material will be updated.

My Department acknowledges that there is additional administration for providers with the introduction of new schemes such as the NCS and Core Funding, and has allocated €32.13 million for administration under Core Funding in year two, and €35.34m for the third year of the scheme. In addition, a number of targeted supports are being considered by my Department to enable Core Funding Partner Services to comply with the financial reporting requirement.

Roderic O'Gorman (Dublin West, Green Party)
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Investment in early learning and childcare is at unprecedented levels with public funding for the first time reaching more than €1 billion in 2023 for early learning and childcare – a clear demonstration from Government of the value of the sector.

Core Funding is in operation since 15 September 2022 and has achieved very significant success in terms of the high levels of participation. With 95% participation in year 1 and to date, 94% or over 4,300 providers have signed up for Core Funding Year 2, with applications still open. There are officially more services contracted for Core Funding year 2 than there were at the peak of Core Funding year 1.

Participation in Core Funding is optional but it remains open to all registered providers subject to their agreement to the terms and conditions of the funding.

The number of partner services which are withdrawing/who have withdrawn from the core funding programme since September 2023 is currently 3*.

Core Funding has increased by 11% to reach €287 million for year 2 of the scheme, providing a sustainable platform for investment with increases for all services.

Budget 2024 allocated an additional €37.4m to Core Funding. This increase on the 2023 allocation will support continued implementation of the scheme for the second programme year (September 2023 to August 2024) and into the third programme year from September 2024.

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 support it provides to parents through the associated fee freeze.

There is extensive engagement with provider representatives and providers of all types, via various specific consultation activities and through various fora, including through the Early Learning and Childcare Stakeholder Forum.

In any instances where a service is experiencing financial difficulty, they can reach out to their local City/County Childcare Committee and avail of Case Management Supports. This can include operational supports as well as financial supports through Sustainability Funding if deemed appropriate.

*Please Note: This number indicates the amount of Services that have withdrawn from the core funding programme since September 2023. My Department only receive the information on services withdrawing once the withdrawal has taken place and not those that might be in the process of withdrawing.