Dáil Éireann Debate, Tuesday - 19 May 2026
868. Deputy Grace Boland asked the Minister for Children, Disability and Equality if her Department has examined alternative funding models for community childcare, including funding childcare places rather than hourly capitation per child; whether a "poverty premium" has been considered to reflect enhanced supports provided in disadvantaged settings; and if she will make a statement on the matter. [37004/26]
View answerThe early learning and childcare sector is currently an entirely privately delivered sector with three quarters of operators established on a for-profit basis and one quarter of a not-for-profit basis.
Following on from the publication of Partnership for the Public Good in 2021, the sector has seen substantially increased public funding accompanied by significantly greater levels of public management.
Government sees a role for both private and community in the early learning and childcare sector and accordingly it does not differentiate between for-profit and not-for-profit services in either the eligibility criteria for or the calculation and distribution of either Core Funding or demand-side funding through the ECCE programme, the Access and Inclusion Model (AIM), the National Childcare Scheme (NCS) and Equal Start.
Funding Staffed Childcare Places
Core Funding is a supply-side grant to providers designed to support quality, sustainability, and enhanced public management, with associated condition in relation to fee control and cost transparency, incorporating funding for administration and to support the employment of graduate staff.
The calculation of a services Core Funding grant contains multiple elements – the Base Rate, Graduate Premiums, Targeted Measures and the new Staff Funding Additional Contribution.
The majority of funding distributed to services via the base rate. This is based on a service’s staffed capacity, that is, the number of staff, the operating hours, opening weeks and the age group of children for whom services are provided, as well as the number of places available. The scheme also pays graduate premiums for services with graduate lead educators, or graduate managers.
Core Funding allocations are based on staffed places, not on child registrations and attendance levels. Places do not have to be filled in order to be allocated Core Funding, but for capacity to be funded, there must be enough staff in place to satisfy the minimum staff to child ratios as set in the Regulations made under the Child Care Act 1991. This provides services a guaranteed minimum income, supporting stability where attendance may be fluctuating.
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.
Enhanced NCS Income Assessed Supports & Supports for Disadvantaged Settings
The NCS has undergone a number of enhancements in recent Budgets with the minimum NCS subsidy steadily rising from €0.50 in 2022 to €2.14 in September 2024 alongside extensions to eligibility. Additionally, since September 2024, the NCS has been open to Tusla-registered childminders who wish to participate in the scheme. Families availing of childminders who are participating in the NCS can claim a subsidy towards their costs. Further enhancements to the income-assessed subsidy are being introduced from September 2026, raising the base threshold from €26,000 to €34,000 and the maximum threshold from €60,000 to €68,000, with additional increases to the multiple child discounts.
An evaluation of the NCS commenced in Q1 2026. The evaluation will assess the performance of the NCS to date and its operation within the wider early learning and childcare funding and policy environment. The evaluation will examine whether the NCS, as part of the wider funding model, is making high-quality early learning and childcare more accessible and affordable, particularly for families in the lowest income groups and the most disadvantaged households. It will also identify any improvements that could be made to enhance accessibility and affordability and to ensure that the NCS is working for as many families as possible. In particular, as outlined in Simplify and Support, the Action Plan for Simplification, through the evaluation and the development of Phase 2 of Shaping the Future, there is a commitment to examine alternatives to the NCS hourly-based subsidy model.
With regard to enhanced supports for services operating in the context of disadvantage, in September 2024, the Department commenced the rollout of Equal Start, a major model of supports to ensure children experiencing disadvantage can access and meaningfully participate in early learning and childcare.
Equal Start includes a suite of universal supports, child-targeted supports, and setting-targeted supports to ensure every child and every early learning and childcare setting will benefit from a continuum of supports that reflects a continuum of need.
Settings benefitting from setting-targeted supports are settings which have been objectively identified as operating in the context of the highest levels of concentrated disadvantage.
In line with the rules for Equal Start, Partner Services with a Tier 1 or Tier 2 priority designation under Equal Start in 2024 will retain that designation for a two programme year cycle once they remain in contract for Core Funding (i.e. for programme years 2024/25 and 2025/26). The Equal Start Identification Model will be rerun in 2026 for the next two-year cycle (i.e. programme years 2026/27 and 2027/28) for all settings.
