Frank Feighan (Sligo-Leitrim, Fine Gael)
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893. To ask the Minister for Children, Disability and Equality if she will engage with private childcare providers who avail of core funding from her Department on the issue of significant increased costs under the new obligations under the auto enrolment scheme. [61978/25]

Frank Feighan (Sligo-Leitrim, Fine Gael)
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894. To ask the Minister for Children, Disability and Equality If she will consider increasing core funding rates to take into consideration the additional costs incurred by auto enrolment; and if she will make a statement on the matter. [61979/25]

Norma Foley (Kerry, Fianna Fail)
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I propose to take Questions Nos. 893 and 894 together.

The introduction of Core Funding in 2022 brought a significant increase in investment for the sector. €259 million of funding was made available for services in year 1 of the scheme, of which €210.8 million was entirely new funding to the sector.

Core Funding has increased annually, now exceeding €390 million for the current and fourth year of the scheme. This is an increase of over 50% since the scheme began in September 2022. The additional funding is supporting further capacity growth, the maintenance of a fee management system to benefit families and significant improvements to pay and conditions in this valued sector.

I was delighted to announce further investment in Core Funding in Budget 2026. The additional funding being made available in 2026 will see the allocation for Core Funding in the next programme year which begins in September 2026 increase to almost €437 million. That is an additional €44 million on the current full year allocation, or an 11% increase.

This increased investment will allow for further increases in capacity across the sector and will support Partner Services in adhering to the fee management conditions of the grant including reductions in the maximum fee caps from September 2026. This will support the sustainability of the sector while maintaining Core Funding affordability measures for families. Full details of Core Funding 2026/2027 will be made available to the sector in 2026.

The Department is supporting the roll-out and implementation of MyFutureFund through sector specific communications in collaboration with the Department of Social Protection.

The base rates in Core Funding have been developed using the various components associated with the cost of delivery of service provision such as; staff pay and conditions, including contact and non-contact time, holiday pay, sick pay and other employer costs such as pension contributions; administrative staff/time and non-staff overhead costs. These components have been factored into the calculation of the budget for Core Funding since the scheme began in 2022.

Although, the cost of delivery components such as improvements to staff pay have been used to derive the base rates the eligible areas of expenditure of the Core Funding grant are much broader. Partner Services can choose how to spend their Core Funding grant in accordance with the approved areas of expenditure outlines in the Funding Agreement.

I have established an Early Learning and Childcare Provider Consultative Forum, to build on the Department’s strong commitment to, and track record in, engaging with stakeholders in the sector through the Department’s advisory, oversight, consultation and research processes. Under the Terms of Reference the Early Learning and Childcare Provider Consultative Forum will discuss policy and operational issues relating to the provision of early learning and childcare services. The Forum will inform members of early learning and childcare developments and invite the views, concerns and suggestions from providers, as appropriate.

In addition to the increased level of Core Funding for year 4 of the scheme and in Budget 2026, there are wider financial supports available from the Department where a service is experiencing financial difficulty or has concerns about their viability, which can be accessed while remaining within Core Funding.

The Department offers Sustainability Funding to services where issue/s have been identified through the Case Management process that have the potential to have serious consequences for their viability. As part of the Case Management process, in which local City or County Childcare Committees (CCCs) assist services with issues and difficulties that arise, the CCC may refer Core Funding Partner Services facing difficulties to Pobal and the Department to be considered for Sustainability Funding.

Sustainability Funding is intended to prevent significant issues that threaten the viability of a service from occurring in first instance, and any service seeking these supports should contact their City or County Childcare Committee.