Claire Kerrane (Roscommon-Galway, Sinn Fein)
Link to this: Individually | In context

691. To ask the Minister for Children, Equality, Disability, Integration and Youth metric used to reduce the maximum amount of Core Funding from 600,000 in year two, 500,000 in year three and 450,000 in year four in September 2025; and if she will make a statement on the matter. [32046/25]

Norma Foley (Kerry, Fianna Fail)
Link to this: Individually | In context

As with all State expenditure, there is a limited amount of funding available in a given year and adequate budgetary controls are required to ensure that expenditure does not exceed the funding allocated for a specific purpose.

The maximum Base Rate allocation is an enhanced budgetary control for Core Funding that is being introduced incrementally to manage and monitor the impact on individual services in a sustainable manner. It creates an upper limit for expenditure through the scheme.

This maximum Base Rate allocation was introduced in September 2023 for the second year of Core Funding. It maximises the efficiency of significant State investment in the sector, to best spread a limited budget across the entire sector rather than increasing funded capacity for the largest services.

This maximum does not apply to the Graduate Premiums and the new Staff Funding Additional Contribution, which will increase a Partner Service’s total allocation beyond this maximum base rate allocation.

When introduced, this maximum allocation was set at an annual value of €600,000. This was deliberately above what any service was in line to receive under the new increased Base Rates which took effect in September 2023. This was the first step in the incremental introduction of enhanced budgetary controls for Core Funding. 2023/2024 was a transitional year where the concept of an upper control was introduced to the sector in a considered and controlled manner, without impacting any individual service.

For Year 3 (2024/2025), the maximum Base Rate was reduced to €500,000. Again, this was done in a careful manner. My Officials identified the services who would be impacted by this measure and assessed the impact of the reduced maximum allocation on their funding. Five services are in receipt of this maximum allocation of €500,000 with graduate premiums bringing their grant higher. These are services who will be in receipt of some of the highest levels of funding from my Department nationwide.

From September 2025, the fourth year of Core Funding, I will be reducing the maximum allocation to €450,000. Based on current operating models, just nine Partner Services will be reaching this upper limit. I have carefully considered the impact of this upper limit of funding on these services.

Achieving value for money from this significant State investment is vital. The reduction in the maximum allocation from September will continue the incremental and measured introduction of enhanced budgetary controls for this grant whilst also allowing funding to increase for the smallest services around the country who would be more vulnerable to rising costs and fluctuating incomes.

I am confident that this measure will not make any service unsustainable. However, any service facing sustainability concerns can continue to avail of supports through my Department’s established case management process, through which local City and County Childcare Committees and Pobal work together to assess and provide support including financial support to services experiencing difficulties.