John Paul O'Shea (Cork North-West, Fine Gael)
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1878. To ask the Minister for Children, Equality, Disability, Integration and Youth for an update on the investment by the Government into the early years sector in recent years; the plans for investment in 2025 and beyond; if additional core funding is being considered for the sector; and if she will make a statement on the matter. [20168/25]

Norma Foley (Kerry, Fianna Fail)
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Investment in early learning and childcare is now at unprecedented levels with public funding exceeding €1.37 billion in 2025, clearly demonstrating Government commitment to this area.

This Department operates a range of Early Learning and Care (ELC) and School Age Childcare (SAC) funding schemes. These funding schemes, which include the ECCE Programme, National Childcare Scheme, Access and Inclusion Model, Equal Start and Core Funding, are administered by Pobal on behalf of the Department.

The 2025 Budget allocation of €1.37bn for ELC and SAC in my Department follows a historic €1.109 billion made available in Budget 2024, having reached €1 billion per annum investment in 2023. This was 5 years ahead of the 2028 target of €1 billion in annual investment outlined in First 5.

Budget 2025 provides additional investment of €266m, or 24%, which will allow my Department to bring forward a substantial and comprehensive package of developments to achieve significant progress on the provision of affordable, high quality, inclusive and sustainable ELC and SAC. This increased Government investment will also facilitate capacity growth within the sector and provide additional supports for children and families experiencing disadvantage.

The table below provides this Department’s Budget Allocations on ELC and SAC from 2019 to 2025.

Record numbers of children and their families are now benefiting from the NCS. Almost 220,000 unique children benefited from an NCS subsidy in 2024.

Regarding investment plans into the future, an evaluation of the Scheme is due to start this year. This evaluation will review how the Scheme has performed to date and identify potential enhancements that could be made. Changes to the scheme will also be informed by the Programme for Government commitments to reducing the cost of early learning and childcare to €200 per month per child and exploring options to cap childcare costs including costs for larger families

An independent review of the Early Childcare and Education (ECCE) Programme was completed last year with the final report published last October. This review examined how the Programme is currently functioning and identified enhancements that could be made based on comprehensive stakeholder engagement with children, parents, ECCE providers and educators. The outputs for this review are currently being considered and will inform the future development of ECCE.

The introduction of Core Funding 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 to the sector.

Core funding increased by 11% to reach €287 million for the second year of the scheme (September 2023 to August 2024). The allocation of this additional funding in year 2 of the scheme was informed by the emerging data from Year 1 as well as data from an independent financial review of sessional services and feedback from stakeholders. In year 2, new targeted supports - aimed at improving the sustainability of smaller and sessional services – were introduced. These include a flat rate allocation of €4,075 for all sessional-only services, and a minimum base rate allocation of €8,150, which will benefit small, part time and school-age services.

Core Funding increased by another 15% to €331 million for the current and third year of the scheme (September 2024 to August 2025). Again, the allocation of this additional funding in year 3 of the scheme was informed by the emerging data from previous years as well as feedback from stakeholders. Targeted supports for small and sessional services in Year 2 of Core Funding were enhanced in Year 3. Specifically, the flat rate allocation was set at €5,000 (increased from €4,075 in Year 2) for sessional-only services, and the minimum base rate allocation was set at €14,000 (increased from €8,150 in Year 2). Moreover, while the fee freeze continued in Year 3 for most services, and in response to concerns raised by some providers, there was also changes to fee management in Year 3, including:

• A fee increase process for certain providers
• A fee cap

The new Programme for Government, which was published on 15 January 2025, commits to review and increase Core Funding, ensure that providers’ fees are open, transparent and equitable and readily available to parents, and to maintaining the fee cap.

The scope of that review will be considered in the context of broader and related commitments in the Programme for Government to improve affordability, access, availability and quality.

In 2025, €25 million is being made available to support existing early learning and childcare providers to expand their provision by undertaking extensions to existing premises or, in the case of not-for-profit providers, to purchase or construct new premises.

The scheme has now closed for applications, appraisals are being undertaken and applicants will be notified shortly of the outcome of the process.

The approach to capital expenditure in future years will be informed by the commitments in the Programme for Government, particularly about a greater role for State-led provision, and the funding allocation will be determined by the revised National Development Plan.

In September 2024, my Department commenced the rollout of Equal Start, a major model of supports to ensure children experiencing disadvantage can access and meaningfully participate in early learning and childcare.

Equal Start is designed to be developed and rolled out in phases. Services with the highest level of need are targeted in the early phases.

€17.2 million has been allocated to Equal Start in 2025 raising from commitments in Budget 24 (€13.4 million) and Budget 25 (€4 million). Full year costings of all these measures will be €25 million.

Funding for additional measures will be requested in budgets during the lifetime of Equal Start. Equal Start supports will be fully rolled out in three phases over a five-year period, with full implementation within the lifetime of First 5 – by 2028.