John Lahart (Dublin South West, Fianna Fail)
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127. To ask the Minister for Children, Equality, Disability, Integration and Youth the progress being made on the urgent need for reform of core funding in order that it actually benefits both providers and parents, increase NCS subsidies to provide direct financial relief to families and in addressing the childcare crisis by ensuring sustainable funding for all providers to encourage more services to remain in operation; and if she will make a statement on the matter. [26220/25]

Norma Foley (Kerry, Fianna Fail)
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The introduction of Core Funding in 2022 brought a significant increase in investment for the sector, with €259m of funding paid directly to services in year 1 of the scheme, of which €210.8m was entirely new funding.

Since the Scheme was introduced, its effectiveness has been subject to ongoing review and the scheme itself has evolved year on year.

Core funding increased by 11% to reach €287m for the second year, and by a further 15% to €331m for the current and third year of the scheme. The allocation of this additional funding in year 2 and 3 of was informed by the data from previous years, feedback from stakeholders as well as an independent financial review of sessional services by Frontier Economics.

Targeted supports for small and sessional services introduced in year 2, were enhanced in year 3.

Moreover, changes to fee management were introduced in year 3, enabling low fee services to apply for a fee increase.

The full year allocation for year 4 of Core Funding will be €350m. A further €45m has been ringfenced to support employers to meet the costs of further increases to the minimum rates of pay in the sector.

Combined, and contingent on the third successive Employment Regulations Orders, the Core Funding allocation will exceed €390m. The details of this allocation, which will be published shortly, has been informed by data from previous years as well as stakeholder feedback.

The NCS has undergone a number of enhancements in recent years to further improve affordability for parents. These include the extension of the universal subsidy to all children under 15 and two increases to the minimum hourly subsidy, which is now worth a minimum of €96.20 per week for 45 hours.

Additionally, the Department will soon commence an evaluation of the NCS. This will include consultation and engagement with parents, educators, and representative organisations. This evaluation will examine how the NCS is performing currently and identify ways in which the NCS can better support families.

An evaluation of the first year of Core Funding and the development of an evaluation framework for Core Funding is currently underway. This project will examine the early implementation of Core Funding and make recommendations for future evaluations of the grant. Findings from the project are expected in Quarter 4 2025.

This project is being undertaken by Irish Government Economic and Evaluation Service or IGEES policy analysts working in the Research and Evaluation Unit of my Department.

IGEES is an integrated cross-government service established in 2012 with the objective of enhancing the role of economics and value for money analysis in public policy making. It is part of the Department of Public Expenditure, NDP Delivery and Reform.

I do not want any service to be faced with financial sustainability issues and officials in my Department are committed to working with any such service to support them in delivering early learning and childcare for the public good.

As such, in addition to the increased levels of Core Funding since the scheme was introduced, there are wider financial supports available from my Department where a service is experiencing financial difficulty or has concerns about their viability.

This support can take the form of assisting services with interpreting analysis of staff ratios and cash flow, financial support, as well as more specialised advice and support appropriate to individual circumstances. These supports can be accessed by any Core Funding Partner Service by contacting their local County/City Childcare Committee and requesting Case Management support.