Niall Collins (Limerick County, Fianna Fail)
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550. To ask the Minister for Children, Equality, Disability, Integration and Youth if he can address the issues raised in correspondence (details supplied); and if he will make a statement on the matter. [6588/24]

Roderic O'Gorman (Dublin West, Green Party)
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There are a number of issues raised in the correspondence to which the Deputy refers, a response to these issues are now set out.

Quality Action Plan

In line with a recommendation in Partnership for the Public Good, providers that have an active Core Funding Contract must submit a Quality Action Plans. All services are provided with a quality self-assessment template for this purpose. The quality planning options for year 2 of the Scheme include the following:

• Implement improvements on aspects of quality as identified in Inspection Reports (either Tusla or Department of Education Inspectorate)
• Participate in quality engagement actions through the Better Start Quality Development Service
• Participate in National Síolta Aistear Initiative (NSAI) opportunities
• Complete a comprehensive review and development of chosen statements, policies, procedures, and practices.
• Participate in quality improvement activities (workshops, communities of professional practice, mentoring & support, self-evaluation, and quality improvement) through DCEDIY-funded services e.g., City/County Childcare Committees, National Voluntary Childcare Organisations and Better Start.

Core Funding Financial Reporting Requirements

In line with a recommendation in Partnership for the Public Good, providers that had an active Core Funding Contract during the 2022/2023 Programme Year must provide validated Financial Returns as per their Core Funding Partner Service Funding Agreement.

Following constructive engagement with members and nominees of the Early Learning and Childcare Stakeholder Forum (ELCSF), my officials finalised transitional arrangements for financial reporting to cover year 1 and year 2 of the scheme.

Financial reporting requirements in this transitional phase have been significantly simplified and streamlined. Specifically, in this transitional phase, the financial reporting requirement is for an income and expenditure report based on a significantly reduced set of Core Funding Chart of Accounts nominal codes, the sector has already been provided with the templates and guidance documents in relation to this.

This Income and Expenditure Report will need to be submitted onto an online reporting portal by either a qualified accountant from a registered practice or a registered professional (ACA, ACCA, CPA, CIMA) by 22 March 2024.

My Department will be providing guidance to Partner Services in the coming weeks on how to access and upload the completed income and expenditure report. All early learning and childcare Department income information will be provided to the Partner Services through the financial reporting portal in the coming weeks.

My Department are also working on other supports for providers in preparing and submitting these returns, including training supports and targeted financial supports for those that may need it.

Fee freeze

A primary objective of Core Funding is to improve pay and conditions in the sector as a whole and improve, affordability for parents as well as ensuring a stable income to providers.

Core Funding offers greater stability and sustainability for providers by substantially increasing the overall investment in the sector, particularly through a supply-side funding approach and in providing funding for spaces rather than participating children. Services can choose to spend their Core Funding on any items connected to the high quality delivery of their service.

Core Funding operates in addition to and alongside ECCE, AIM, CCSP and NCS. It replaces the approach to paying for graduate lead educators through ECCE that operated under the previous funding model (higher capitation) and incorporates funding previously allocated to the discretionary Programme Support Payments (PSP). These developments allocate funding more fairly in respect of graduates and administration.

The original Core Funding allocation of €207m increased to €221m in spring 2022 at a time when cost pressures were significantly increasing. This further increased to €259m based on significant capacity growth in sector in Budget 2023 with additional contributions for staff pay and conditions, non-staff overheads, administration staff/time and graduates factored in.

For the second year of operation, Core Funding increased by €28 million, an 11% increase, to a total of €287m.

Fee management introduced with the substantial investment of Core Funding follows the recommendations in Partnership for the Public Good, to first limit increases in fee rates. This effectively freezes services fees at those they charged to parents in September 2021 to ensure that the introduction of Fee Management to the sector was done in a sustainable and considered manner. Increasing the Core Funding budget while maintaining the same level of conditions on fees, will help embed the Core Funding Fee Management system in the sector and prepare the sector for the ongoing development of fee management in future years.

Each service will vary depending on their operational decisions and models, however between ECCE and Core Funding, ECCE services will get a minimum of €79.20 per child per week in the 2023/2024 programme year, compared to €78.75 last year. This is before additional graduate premium of €4.44 per hour and the flat rate of €4,075 per year are added, where applicable.

Services that are experiencing difficulty and who would like support are encouraged to contact their City/County Childcare Committee (CCC) to access case management supports. Services can be assisted on an individual basis through this route. Sustainability funding is available to Partner Services, community and private, who are experiencing financial difficulty.

ECCE capitation

My Department funds private early learning and care service providers to provide the ECCE programme at a standard rate of €69 per week per child attending the ECCE programme. With the addition of Core Funding, services providing ECCE who are also signed up to Core Funding receive a minimum of €79.20 per child per week in capitation. This figure can rise to a maximum of €95.85 with additional funding for graduate lead educators and graduate managers for sessional services. Core Funding is tailored to the individual service and is specifically designed to contribute to its operating costs and sustainability of the service making it a more flexible platform for investment towards the operating costs of services.

Services that are experiencing difficulty and who would like support are encouraged to contact their City/County Childcare Committee (CCC) to access case management supports. This case management process through the CCCs is the route to access additional sustainability funding if required.

Finally, I would note that I have appointed Stranmillis University College, Belfast to undertake an independent review of the ECCE programme. The review will assess whether the ECCE Programme is meeting its core objectives and will identify any changes or improvements that can be made to the Programme, based on international evidence and experience to date. The final report of the review is nearly complete, once it has been finalised I will consider the review in its entirety and consider any policy changes that may need to be made to the programme.

Expansion of AIM

The Access and Inclusion Model (AIM) is in place to support children with disabilities in ECCE Programme. The goal of AIM is to create a more inclusive environment, so all children, regardless of ability, can benefit from quality early learning and care. AIM achieves this by providing universal supports to settings, and targeted supports, which focus on the needs of the individual child.

An independent evaluation of AIM was published on 19 January 2024. The findings from the evaluation have already informed the phased extension of AIM announced in Budget 2024, commencing with the extension of targeted AIM supports to ECCE-age children beyond time they spend in the ECCE programme, both in-term and out-of-term from September 2024.

Retention and recruitment of staff.

Providers of early learning and childcare are private businesses. As the State does not employ staff in these services, neither I nor my Department can set wage levels or determine working conditions for staff in the sector.

However, there is now, through the independent Joint Labour Committee (JLC) process, a formal mechanism established by which employer and employee representatives can negotiate terms and conditions of employment including minimum pay rates for different roles in early learning and childcare services. The JLC continued to meet during 2023 to discuss possible changes to the EROs. The committee was supported in its negotiations by my Department through the provision of the latest information and data on Government funding for the sector, while Core Funding has provided significant additional funding to services to meet higher wage costs arising from EROs, in addition to other objectives. I understand that the JLC published draft proposals for setting new minimum rates for workers in the sector in January this year. Broadly, they propose a 5% pay increase for all roles, following Labour Court recommendations.

In line with commitments in First 5, in December 2021, I launched Nurturing Skills: The Workforce Plan for Early Learning and Care (ELC) and School-Age Childcare (SAC), 2022-2028. Nurturing Skills aims to strengthen the ongoing process of professionalisation for those working in the sector and to raise the profile of careers in the sector. It includes a career framework and commitments to support early years educators and school-age childcare practitioners to upskill and develop their careers. It also includes commitments to strengthen continuing professional development for staff working in the sector.

Auditing by Pobal

Pobal CAR (Compliance, Audit and Risk) inspections have a distinct focus on compliance with my Department’s funding scheme rules, for those services in the sector that have signed up for, and are in receipt of funding under these schemes. My Department recognises the valuable work carried out by providers and staff. However, Pobal inspections are vital to protect the integrity of schemes, by ensuring that such monies are being used appropriately and that risks to Exchequer funding are detected and minimised.

Inspection and regulation

The safety and protection of children remains the first priority of Government in early learning and childcare. Central to achieving this is enforcement of regulations, which have children at the heart of their implementation. Inspection and regulation of these services are a critical component of ensuring that services are safe and that the children attending receive high quality care and education.

A number of changes are being implemented to reduce the administration associated with regulation for providers.

Firstly, the regulations for both pre-school and school-age childcare services were recently amended in order to streamline re-registration processes from 2022 onwards. This change reduced the administration attached to renewal of registration for services.

Secondly, my officials are currently working closely with the two inspectorates, the Tusla Early Years Inspectorate and the Department of Education Inspectorate, in order to reduce the administration for providers, support the quality of services, and support clear communications to the sector. A design and implementation planning process to bring together the functions carried out by the two inspectorates into a single body that provides integrated care and education inspections for early learning and childcare services has been committed to in First 5.

Reform of the legislation governing the early learning and childcare sector is also currently underway. While the primary purpose of the reform process is to enhance the enforcement powers of the Regulator and also remove the legal exemption relating to childminders, it will also seek to streamline the regulations where possible and bring clarifications to certain sections where needed.

Administrative Burden

I recognise the additional administrative work associated with my Department’s funding schemes such as Core Funding and the NCS. As such, Core Funding has allocated €32.13 million for administration under Core Funding in year two, and €35.34m for the third year of the scheme.

In addition, officials in my Department has been working with Pobal to enhance the provider and parent online administrative portals and to put in place a suite of provider and parent supports in order to reduce administrative demands, where appropriate. Engagement with providers has underpinned this work. A Sub-Group of the Early Learning and Childcare Stakeholder Forum was convened in November 2022 to identify ways to reduce provider administration for the January 2023 NCS rate increase. The increase required providers to issue tens of thousands of new parental agreements with the new co-payment rates.

In response, Pobal deployed a semi-automated parental agreement in December 2022, released the uplift portal details in early December and gave a 3-month window to complete the contracts. A combined parental agreement was also introduced for the 2023/24 programme year obviating the need to update agreements on subsequent co-payment changes. In additional a universal fees list was introduced.

On 19 September, I announced plans to develop an Action Plan for Administrative and Regulatory Simplification for the Early Learning and Childcare Sector were announced, supported by a Working Group comprising representatives from the Department, Pobal and the City / County Childcare Committees. This initiative is being informed by an Advisory Group comprising providers, educator/practitioner and parent representatives, which was convened in December 2023 and to date has met on 4 occasions.

The Advisory Group aims to:

• Offer an overarching dedicated point of consultation and advice in relation to the review of the administrative and regulatory requirements for early learning and childcare sector and the formulation of the Action Plan for Administrative and Regulatory Simplification.
• Advise on the reports arising from the regional stakeholder consultation events
• Advise on means to address high-level operational or cross-sectoral challenges that may arise in the implementation of the Action Plan.

The Action Plan will be finalised and published in 2024 after the conclusion of the review and consultation.