Minister O’Gorman announces details of €331 million in funding for early learning and childcare services

• Details of Core Funding Year 3 will see €331 million in funding provided directly to early learning and childcare services, a €44 million or 15% increase on Year 2.
• Vast majority of services will see at least a 3.5% increase in funding for capacity, with larger increases for places offered to children under the age of three.
• Further increases in funding for small and sessional services.

Minister for Children, Equality, Disability, Integration and Youth, Roderic O’Gorman, today announced details of Year 3 of Core Funding worth €331 million, which will run from September 2024 to August 2025. This is an increase of €44 million (15%) on the current programme year. This funding will accompany new developments to the scheme rules to support services as well as children and their families.

First introduced in 2022, Core Funding is a grant to early learning and childcare providers towards their operating costs, and in return for significant investment, services agree to conditions of the scheme, including fee management and financial transparency.

The new developments for Year 3 of Core Funding will include:

• An increase to the flat rate top-up for sessional-only services to €5,000 per service (currently €4,075);

• An increase to the minimum amount of funding a centre-based service will receive to €14,000 per year (currently €8,150);

• An increase to the base rate allocation per place offered across all age groups, with larger increases for children under three years old; and

• Funding to support capacity growth of almost 6% across the sector.

In addition, the maximum allocation for service under the scheme will be capped at €500,000.

Accompanying changes to the allocation model, the Minister is making changes to the Fee Management System under Core Funding from September.

For the third year of the scheme, the effective freeze on fees will be maintained. A new feature of Core Funding in Year 3 will allow some services to apply for a fee increase within Core Funding, where appropriate. Where this occurs, National Childcare Scheme subsidies will ensure that no increase in out-of-pocket costs will be felt by parents/guardians.

In addition, from September there will be a maximum fee permitted under Core Funding for new services joining Core Funding for the first time. A cap on fees will extend to all services in contract for Core Funding from September 2025 (Year 4). Information on what these changes mean for parents will be available at https://www.gov.ie/en/campaigns/5ab17-childcare/.

Welcoming the announcement, Minister O’Gorman said:

“I am delighted to be in a position to increase Core Funding to Partner Services for Year 3. The increases I am announcing today will take effect in September 2024 and will support expanded capacity, particularly capacity for children under three and stability of income to services, particularly low-income services. Since its introduction, I have pledged to grow Core Funding and I have delivered on that. ”

The Minister added:

“In addition, the developments around fee management will ensure that, where needed, services will be able to make a permanent step towards a more stable financial position without compromising on overall affordability for parents/guardians.”

“I am hopeful these enhancements combined will pave the way for further negotiations to improve pay by the independent Joint Labour Committee”.

For more information visit www.first5fundingmodel.gov.ie/