Jerry Buttimer (Fine Gael)
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I am informed that Senator Garvey is running late. I apologise to the House and to the Minister of State, Deputy Ossian Smyth, who is here. With the permission of the House, we will take Senator Currie's Commencement matter because she is here and so is the Minister of State, Deputy Colm Burke.

Ossian Smyth (Dún Laoghaire, Green Party)
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Is the Minister of State, Deputy Burke, here?

Jerry Buttimer (Fine Gael)
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He is. I apologise to the Minister of State for inconveniencing him. We will reverse the order and take Senator Currie now.

Jerry Buttimer (Fine Gael)
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That is true, yes.

Jerry Buttimer (Fine Gael)
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He has ruled himself out after this morning's "Morning Ireland". I thank the Minister of State, Deputy Burke, and Senator Currie for being here.

Emer Currie (Fine Gael)
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I am going to get right to the heart of matters this morning and talk about core funding and staffing issues for childcare providers. This is based on engaging with a range of childcare providers of various types in Dublin West. All of them speak to overburdensome paperwork and financial reporting; accounting requirements that go far beyond their capacity and capability when everything is already transparent and submitted to Revenue; and administration that is getting in the way of relationships with parents and the real work of delivering quality care and education. The scale of non-contact time and the lack of funding for non-contact time is putting serious pressure on providers.

I have been speaking to a couple of providers. A smaller pre-school told me that they stay up to midnight every night filling up paperwork themselves, for maybe two to three hours every day. A larger provider said their centre manager spent three full days a week administering the schemes.

Moving on to staff retention and recruitment, childcare workers do not feel valued. They are leaving or they are not attracted to the sector. The reality is they are not being paid enough for the work they do. I appreciate the rise in the ERO but sadly, it is not enough to compete with other careers. Providers in Dublin West are already paying those levels anyway. Level 8 graduates are leaving the sector to work as primary school teachers or in therapies. Other levels are attracted to becoming SNAs with better hours, conditions and holidays. We are losing really good people who want to work in early years and the result is providers are closing down rooms. Tigers Childcare has informed parents of their struggles with staff, and services are closing. Chatterbox in Rockabee Park, for instance, announced last week that it is closing because of staff shortages.

Early learning graduates should be treated equitably with school teachers at this stage. We need to keep and value the people who have years of experience in childcare but do not have degrees. We need to offer more training and support more opportunities. There is a very strong argument for core funding covering staff costs. If early learning and childcare is an essential public service, we have to start treating it as such.

Core funding is working for some but for others it really is not. I fear that the Government underestimates how precarious the situation is. How many providers are on the verge of pulling out of core funding? The 15% increase in core funding does not translate into 15% for services. I am told the overall uplift for services is about 2.5%, and the Government is right to freeze fees at 2019 levels for parents. I really believe that. However, if we are going to do that we have to take into consideration the increased operating costs over the last five years. They cannot expect services to absorb those losses when they know it is not a high-profit sector for most.

Core funding increases are not enough to cover the additional cost of recruitment, retention and administration. There is not enough funding for baby rooms. Where does quality come into all of this? There are flaws that need to be rectified. The fact that new services can set their fees but existing services cannot increase theirs is creating problems and tension. I very much believe in core funding. As a model, it works but it has to adapt. It needs further investment, funding and partnership. Right now, there is too much rigidity and there is not enough trust. We need short- and long-term solutions to staffing. This really is a ticking timebomb. All the signs are there for us to read - room closures, service closures, and ECCE operators struggling to survive. Every service and every place matters.

Colm Burke (Cork North Central, Fine Gael)
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I am taking this Commencement matter on behalf of the Minister for children. I thank Senator Currie for raising this important issue and for offering me the opportunity to respond. Ensuring access to high-quality and affordable early learning and childcare is a key priority for the Government. Various data sources provide evidence that the supply of early learning and childcare is increasing in terms of the number of services opening and the number of places and hours of provision that services are offering.Sector profile data shows an 8% increase in enrolments nationally between 2022 and 2023, with increases in enrolments in the Dublin area ranging from 5% in Fingal to 14% in Dún Laoghaire-Rathdown for the same period. Data from core funding shows an increase of 3% in the number of hours of provision being delivered between September 2022 and September 2023, with capacity increases of approximately 6% to be funded through core funding from this coming September. Tusla registration data from 2023 shows the largest increase in early learning and childcare services in a number of years. There has been a smaller number of closures and a net increase of 129 in the overall number of services nationally. A growth trend has been observed in the first five months of 2024. Specifically, the data from Tusla on the numbers of closures and new services opening from the end of May 2024 shows that so far in 2024 there has been a net increase of seven early learning services such as crèches and preschools and 24 stand-alone school-age childcare services across the country. According to this Tusla data, over the period January to May 2024 four early learning and care services opened in Dublin and three closed, while five stand-alone school-age childcare services opened in Dublin and none closed.

The Minister, Deputy O'Gorman, acknowledges that some parents continue to have difficulty in finding places for their children, in part due to the progress that has been achieved in respect of affordability with the introduction of the fee freeze through core funding and the expansion of the national childcare scheme. To this end, his Department is progressing a range of actions to ensure the supply of early learning and childcare is aligned with demand, with work in this area led by the new supply management unit he established earlier this year. In addition to the significant growth in capacity that has been funded through the core funding scheme, core funding has improved the stability and sustainability of funding to providers. The funding available through core funding has increased each year since the scheme was first introduced and will reach €331 million for year three of the scheme, with every provider in contract for the scheme expected to benefit from significant increases in funding from September 2024.

As well as core funding, special supports are available from the Department where a service is experiencing financial difficulty or has concerns about its viability. This support, accessed through local city and county childcare committees, can take the form of assisting services with interpreting analysis of staff ratios and cash flows, as well as more specialised advice and support appropriate to individual circumstances. I encourage any service experiencing financial difficulty that would like to avail of support to contact its city and county childcare committees to access case management supports. Contact details can be found at www.myccc.ie. What the Minister is saying is that there has been an increase in overall services and we have put in a substantial amount of money and that will continue to increase.

Emer Currie (Fine Gael)
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I thank the Minister of State for his response. As I said, however, core funding is working for some but not for all. It is like a tale of two experiences and I fear we are not listening to the people who are having difficulty. My experience is that this issue is not affecting new services. There is not enough supply in the sector and we need to protect the services that are operating now and keep them in the sector. I completely accept that core funding works, but I think we are at a pinch point. In the next few weeks and months we are going to see an increase in people talking about pulling out of core funding or actually doing so. I spoke to one service today who said core funding covers 15% of its business and it is just not sustainable. I accept these figures but there is a bigger picture here and I ask that the Minister speak to operators like Cherry Blossom montessori in Castleknock. He knows the issues there. Like I said, every place counts.

Colm Burke (Cork North Central, Fine Gael)
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I thank the Senator and I fully agree with her. As we now have full employment, there is competition when it comes to retaining staff. As I stated, the Minister, Deputy O'Gorman, has recently established a new supply management unit in his Department to undertake more detailed analysis of supply and demand. That is an extremely important development. His role is to develop a planning function for monitoring, analysing and forecasting of the supply and demand for early learning and childcare in a nuanced and specific way at local area level. The work of this unit is akin to a forward planning unit in the Department of Education and, as the Senator knows, that unit has been very successful in the Department. The unit will also oversee the administration of capital investment under the national development plan through the building blocks capacity grant. The primary focus of the building blocks capacity grant scheme is to increase capacity in the one- to three-year-old pre-early childhood care and education age range for full-day or part-time care.

The Minister, Deputy O'Gorman, intends to announce details of the latest strand of the scheme in the coming weeks. Under this strand, grants ranging from €100,000 to €600,000 will be made available to early learning and childcare providers to physically extend their services to deliver additional capacity, with a focus on places for children aged under three. The relative demand model has been developed by the Department using the latest census data information. There is a lot of work being done by the Department to expand the services and this new scheme of between €100,000 and €600,000 or €650,000 in grants is a welcome development.