Michael Healy-Rae (Kerry, Independent)
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655. To ask the Minister for Children, Equality, Disability, Integration and Youth his views with regard to improving early years and school age care (details supplied); and if he will make a statement on the matter. [43256/24]

Roderic O'Gorman (Dublin West, Green Party)
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Reform of the early learning and childcare sector has been a major focus of this Government.

The Programme for Government committed to reforming the system to create one that brings together the best of community and private provision and the development of a new funding model for affordable, accessible, sustainable and high quality early learning and childcare.

The framework for reform of the sector is set out in Partnership for the Public Good, the 2021 report of an Expert Group which was established to develop a new funding model for the sector. The key theme of the recommendations in the report was to strengthen State involvement and enhanced public management in the sector, in conjunction with increased State funding. This is intended to be underpinned by a cultural shift to a partnership relationship between providers and the State that reflects the public good dimension of early learning and childcare, with new responsibilities on both sides.

The Expert Group was asked to seek to achieve policy objectives of quality, affordability, accessibility and contributing to addressing disadvantage within the context of the existing system through increased public funding and public management.

The introduction of the new Core Funding scheme and its associated conditionality including in relation to staff pay and fee management; developments to the National Childcare Scheme and the Access and Inclusion Model; and the establishment of Equal Start this year represent the implementation of several of the specific recommendations in the report.

Core Funding in particular has very significantly reconfigured the funding model and way of working between my Department and early learning and care providers. Its introduction in 2022 brought a significant increase in investment for the sector, with €259 million of funding paid directly to services in year 1 of the scheme, of which €210.8 million was entirely new funding. Core Funding, now in its third year of operation, is worth €331 million per year.

This scheme brings a range of benefits to providers, by offering income stability; to educators and practitioners, by supporting improvements in pay and working conditions; to parents by making early learning and childcare much more accessible and affordable; and to children, by promoting better outcomes through higher-quality early learning experiences.

The Expert Group also included in one of its 25 recommendations that: In the medium term, the Minister should mandate the Department to examine whether some element of public provision should be introduced alongside private provision.

In January 2024, I established a new unit, the Supply Management Unit in the Early Learning and Childcare Division. This unit is responsible for developing a new forward planning model and administering capital funding as well as beginning an exploration of public provision as called for in Recommendation 25.

There are a variety of perspectives across different stakeholders in the system of what are the priorities for future policy development for the sector. This includes in relation to what public provision could or should look like. Issues relating to staff employment, pay and conditions; ownership and management of buildings; operating models; governance arrangements; service offering; appropriate level of supply of services; fees for parents; and the overall funding model will need to be examined. These issues, along with the wider potential implications of introducing an element of public delivery, are beginning to be examined by my officials.

In relation to staff pay, a Joint Labour Committee process is underway and its work has led to two Employment Regulation Orders for the sector, supported by additional funding through the sector provided by my Department. This represents major progress in establishing new minimum rates of pay for different roles within the sector and I would like to see this built upon further. I have secured further funding to support additional increases in pay in Budget 2025 equivalent to €45m for a full year, contingent on the agreement of a third ERO.

In addition to securing additional funding for pay, my Department is leading the implementation of a workforce plan for Early Learning and Care and School Age Childcare, Nurturing Skills.

In relation to capacity planning, the development of a forward planning model is currently underway utilising the expertise of statisticians on secondment from the Central Statistics Office and specialists in early learning and childcare as well as a GIS mapper. The model will seek to identify the nature and volume of different types of early learning and childcare places across the country, whether or not those places are occupied and how that aligns with the numbers of children in the corresponding age cohorts at local area level.

It is important to note that demand for early learning and childcare beyond sessional preschool provision is highly elastic and shaped very substantially by families' individual composition, circumstances and preferences; employment patterns and income; and the price and availability of services.

A range of data sources show that the level of capacity in the sector has risen substantially year-on-year between 2022 and 2023. However, there is also evidence that demand for places is increasing and, for certain cohorts and in certain areas, outstripping supply. This is partly driven by the significant improvements in affordability that have been achieved in recent years.

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. The Building Blocks Extension Grant Scheme will operate in 2025 with €25 million available in 2025 to deliver additional capacity for full time places for 1-3 year olds. Under the scheme, community and private providers may apply for funding to physically extend their premises. In addition, community providers may apply for funding to purchase or to construct new premises.

Appraisal of applications for this scheme considers the supply and demand in the area around the proposed projects and seeks to prioritise funding for areas with the biggest supply/demand mismatch.

In relation to establishing an investment target, this is something that I have recently done in the context of the publication of the second implementation plan of the First 5 strategy, published in 2023. The plan articulates the investment target of bringing Ireland in line with the EU average for public investment in early learning and care by 2028.

The budget allocation I secured for 2024 and more recently for 2025 make substantial progress on achieving this target. Budget 2025 allocates €1.37 billion continues to ELC,. This represents an additional investment of €266m, or 24% when compared with 2024, which will provide improved affordability for parents, facilitate capacity growth within the sector, and ensure additional supports for children and families who are experiencing disadvantage.

The funding I secured in Budget 2025 follows a historic €1.109 billion made available in Budget 2024 for Early Learning and Care (ELC) and School Aged Childcare (SAC), having reached €1 billion per annum investment in 2023, 5 years ahead of its 2028 target.

Finally to note that the issue of the level of payment attached to family leave entitlements as referenced in the material accompanying the question is a matter for the Department of Social Protection.