Roderic O'Gorman (Dublin West, Green Party)
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I firmly believe the level of pay for early years educators and school-age childcare practitioners should reflect the value of their work for children, families, society and the economy.

The State is not the employer and therefore does not set the pay or conditions for employees in either early learning and care (ELC) or school-age childcare (SAC) services.

However, there is now, through the Joint Labour Committee (JLC) process, a formal mechanism established by which employer and employee representatives can negotiate minimum pay rates for ELC and SAC services, which are set down in Employment Regulation Orders (EROs). This is an independent process from the Department and neither I, nor my officials, have any role in the proceedings of the JLC and any associated negotiated minimum pay rates, the cost of which is borne by the employer.

Among other objectives, Core Funding supports the ability of service providers to meet the additional costs resulting from the EROs for Early Years Services, which came into effect in September 2022, as it provides increases in funding to early learning and childcare service providers to support improvements in staff wages, alongside a commitment to freeze parental fees.

On the basis of 2022 data supplied by Partner Services taking part in the Core Funding scheme, the estimated annual costs to employers of raising all the minimum pay rates specified in the EROs (for different grades and qualification levels) by the rates proposed in the question (making assumptions specified below in relation to equivalent increases for other roles specified in the EROs) are set out in the table:

In relation to the estimates above, the following should be noted:

• The cost estimates are based on staff who had an hourly wage recorded in service providers’ submissions for Core Funding, but the Core Funding data has been extrapolated to provide an estimate for all staff working in the sector.
• Current wage data was initially provided by service providers in August 2022, before the EROs for Early Years Services came into force, but has been adjusted upward on the assumption that all staff now earn at least the legally-binding minimum rates of pay specified in the EROs.
• The cost estimates are for the additional cost to employers of bringing staff from their current (since August 2022) wage or the minimum pay rates set out in the EROs, whichever is higher, up to a pay rate of €13.85 per hour (and then by each increase listed) or €0.85 (and then by each increase listed) above each of the minimum pay rates in the EROs.
• Calculations are based on wage-data available at a point in time. Some services may have increased wages more recently, which would reduce the cost to services of moving from current wage-rates to the propose wage rates in the question.
• The cost estimates only relate to staff and managers covered by the current EROs, i.e. the estimates exclude the cost of ancillary staff.
• The cost estimates do not attempt to account for the potential cost implications for the wages of staff who are currently earning more than the increased rates above current ERO minimum rates.
• It should be noted that the figures in the table are the additional cost to employers, rather than the additional costs to the State. Core Funding offers a contribution to staff costs. The €287m allocated for Core Funding may already support some employers to pay wage rates above ERO minimum rates.
• The figures in the table do not take into account the income currently received by those working in the sector who are self-employed and who derive their income from profits rather than wages.

Roderic O'Gorman (Dublin West, Green Party)
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In September 2022, I launched Together for Better, the new funding model for early learning and childcare. This new funding model supports the delivery of early learning and childcare for the public good, for quality and affordability for children, parents and families as well as stability and sustainability for providers. Together for Better brings together three major programmes, the Early Childhood Care and Education (ECCE) programme, including the Access and Inclusion Model (AIM), the National Childcare Scheme (NCS) and the new Core Funding scheme. A fourth strand - the Equal Participation Model (EPM) is in development.

Core Funding, which began in September 2022, is the new funding stream to start this partnership for the public good between the State and providers. 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.

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 contributes to services’ sustainability and significantly increases income for the overwhelming majority of services and provides greater funding stability. 95% of services signed up to Core Funding in the first programme year.

The move towards high levels of transparency and openness is an integral part of the new funding model. The publication of this list is in line with Expert Group report Partnership for the Public Good which called for greater transparency and accountability for public funds.

The Core Funding programme year is from September to August. My Department will publish a list of all Partner Services who participated in Core Funding during the first year of the scheme and their Core Funding allocation. Core Funding during its first programme year, (from September 2022 till August 2023) had a budget of €259 million.

This list will be published by the Department in the near future when all final adjustments to the grant values have been made to ensure that values are correct and final on publication. This will be an annual list which will be published at the end of each programme year. A detailed explanation of what the list contains will be published alongside the list.

I and my Department are committed to working with Partner Services delivering early learning and childcare for the public good.