Written answers

Wednesday, 3 July 2024

Department of Children, Equality, Disability, Integration and Youth

Early Childhood Care and Education

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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167. To ask the Minister for Children, Equality, Disability, Integration and Youth the estimated first-, full-year and annual cost of increasing the current minimum rate of pay for early years educators, by €0.85, €1, €1.25, €1.50, €1.75 and €2; and the first-, full-year and annual estimated cost to increase all other grades covered by the early years employment regulation order. [28404/24]

Photo of Roderic O'GormanRoderic 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, 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 2024 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:

Pay increase Estimated additional cost to employers
€0.85 €24.7 million
€1.00 €30 million
€1.25 €41.7million
€1.50 €53.8 million
€1.75 €67.2 million
€2.00 €81 million

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.
  • Cost estimates are based on the most recent data available to the Department which was provided by service providers in May 2024, this data was provided prior to the new EROs for Early Years Services came into force on June 24th.
  • Calculations are there based on minimum rates of pat set out in the initial ERO which came in to effect in September 2022.
  • The estimated costs are for the additional cost to employers of bringing staff, from their current wage or the minimum pay rates set out in the first EROs, whichever is higher, up to the new pay rate as listed in the request. E.g. for an early years educator, costs are estimated based on current rate of pay up to €13.85 (Initial ERO minimum rate for Educators 13.00+ increased listed 85c).
  • 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.

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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168. To ask the Minister for Children, Equality, Disability, Integration and Youth the estimated first- and full-year costs associated with the proposed early years and childcare State agency; the status of the establishment of the agency; and if he will make a statement on the matter. [28405/24]

Photo of Roderic O'GormanRoderic O'Gorman (Dublin West, Green Party)
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Significant progress has been made in advancing plans for a dedicated state agency for early learning childcare and school age childcare. It is envisaged that this agency will undertake the functions carried out by Pobal Early Years (including Better Start), the 30 City/County Childcare Committees, as well as operational functions currently undertaken by my Department.

A Programme Oversight Board has been established to ensure that proposals for a new agency are based on offering the best possible service to children and their families, educators and practitioners and service providers while ensuring value for money.

My Department is currently engaging with independent consultants who have been contracted to carry out a phase of research, analysis and stakeholder engagement to inform the design of the agency. This work, which is expected to take 18-24 months, is currently focused on information gathering, analysis and an initial design phase to take place throughout 2024 and 2025. A second phase relates to a more in-depth design and costing exercise to take place from 2025 and is scheduled to take 6-9 months. The work will culminate in a costed agency design, including the remit, organisational structure and service delivery model, which will be presented to Government for approval.

While full costs will not be available prior to the completion of the design and costing phase, the independent Review of the Operating Model conducted by Indecon presented indicative costs for a dedicated agency at an estimated €14.5m for one-off establishment costs and an annual cost of approximately €50m which represented an additional annual cost of €4.5m compared to the current model. However, economies of scope and scale in the new agency may potentially result in cost savings over time. It should be noted that these costs are only preliminary and may change subject to the completion of the detailed design of the new agency, a full analysis of TUPE obligations, and a comprehensive, robust and evidence based exercise to determine detailed costings.

My Department is committed to ongoing consultation with all stakeholders throughout the design process. In that regard, a series of stakeholder consultation sessions have already been held with key stakeholders in December 2023, January 2024, May 2024 and June 2024 with valuable input being received as part of a collaborative co-design process to develop a vision, mission and values for the agency, and a mapping exercise on the proposed functions for the new agency.

Photo of Rose Conway-WalshRose Conway-Walsh (Mayo, Sinn Fein)
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169. To ask the Minister for Children, Equality, Disability, Integration and Youth the estimated cost to increase the building blocks improvement grant allocation by 10%, 20%, 25% and 50%. [28406/24]

Photo of Roderic O'GormanRoderic O'Gorman (Dublin West, Green Party)
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Capital funding has been allocated to the early learning and childcare sector under the revised National Development Plan (NDP). This will enable significant investment in early learning and childcare.

In 2024 and 2025, my Department is delivering capital investment through the Building Blocks Capacity Grant. The primary focus of the Building Blocks Capacity Grant Schemes is to increase capacity in the 1-3 year old, pre-ECCE, age range for full day or part-time care.

Under the Building Blocks - Improvement Grant, which operated in 2023, €9 million was allocated in grants ranging from €35,000 to €75,000 to fund energy upgrades or retrofit projects.

This scheme is now closed and my Department does not have any further capital funding available for this grant scheme. The table below provides what would be the indicative costs of increasing the Building Blocks Improvement Grant allocation by varying percentages:

Building Blocks – Improvement Grant Allocation Increase by 10% Increase by 20% Increase by 25% Increase by 50%
€9,000,000 9,900,000 €10,800,000 €11,250,000 €13,500,000

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