Core Funding is a new strand of funding to ELC and SAC services which will form part of the new funding model as recommended by an Expert Group and approved by Government in December 2021.

Core Funding is a payment to providers designed to meet the combined objectives of:

• Improved affordability for parents by ensuring that fees do not increase;
• Improved quality through, among other things, better pay and conditions for the workforce;
• Supporting the establishment of an Employment Regulation Order through the Joint Labour Committee;
• Supporting the employment of graduate staff; and
• Improved sustainability and stability for services.

This is a new and different way of providing funding to the sector and is intended to support the development of a partnership relationship between providers and the State that reflects the public good dimension of ELC and SAC.

€287 million is available for Core Funding in Programme Year 2.

The current low pay and poor conditions is the biggest issue affecting quality ELC and SAC in the sector.  Poor terms and conditions are a significant contributory factor to staff turnover which we know is detrimental to quality for children.

The State is committed to supporting Employment Regulation Orders (EROs) through making additional funding available for staffing costs through Core Funding.

Core Funding also facilitates other types of quality enhancements across services by contributing towards non-contact time, CPD, curriculum implementation, and collaboration.

Core Funding introduces a Graduate Premium payment in respect of Lead Educators and Managers across ELC.

The level of fees paid by many families are high, even after deducting subsidies available through NCS and ECCE. This is especially true for families with multiple children using a lot of hours.

Fees vary significantly across the country and from service to service, so the impact of subsidies to reduce fees for parents also varies.

Core Funding  in year 1 introduces a fee freeze for the September 2022-August 2023 programme year. Programme Year 2 of the programme continues this fee freeze from September 2023-August 2024. This will stabilise the fee levels and ensure the affordability benefits of the NCS and ECCE subsidies are felt by parents, particularly the new increase in the minimum hourly National Childcare Scheme to €1.40 off the cost of early learning and childcare.

Poverty and socioeconomic disadvantage significantly impact young children. Disadvantage is widely dispersed but its impact is compounded when it is concentrated.

The new funding model will include funding for universal and targeted measures to address socioeconomic disadvantage, to operate alongside Core Funding, ECCE and NCS.

The introduction of Core Funding provides a strong universal base for all services and begins a partnership approach of delivering ELC and SAC for the public good. This is an important foundation upon which the new funding to address socioeconomic disadvantage can be built in future years.

Core Funding gives providers a stable income source based on the nature of the service they deliver. A provider’s income now consists of Core Funding, NCS and ECCE subsidies, and parental fees. Structuring Core Funding primarily based on capacity means that services have an allocation each year that does not fluctuate in line with children’s attendance.

Core Funding contributes to services’ sustainability and significantly increases income for the overwhelming majority of services and provides greater funding stability.  A number of safeguards have been put in place to ensure there are no unintended outcomes of Core Funding, including a funding guarantee and a Sustainability Fund which are open to services.

Core Funding is related to the costs of delivery.

Core Funding is based on operating hours, number of places offered and the age group of the children, given staff to child ratio requirements.

Services opening longer hours or offering more places will receive a higher value of Core Funding than other services. This is because their costs of operation are higher.

Core Funding contributes to both staff costs and non staff costs of ELC and SAC providers.

Staff costs comprise approximately 70% of a service’s operating costs. Core Funding supports the quality of services by better enabling providers to attract and retain staff including graduate staff; support the new minimum rates established by the Employment Regulation Orders, establish career structures; introduce or improve other features of provision that are demonstrated to contribute to quality (e.g. non-contact time, planning, training, curriculum implementation).

The remaining 30% of services costs are non-staff costs.  Core Funding also supports providers with their non-staff overheads (for example, utilities, rent).

Extra funding to support administration costs is also contained within Core Funding.

Graduates
Core Funding supports graduates to be Lead Educators across ELC and to support graduates as Managers in ELC or combined ELC and SAC services. This aspect of Core Funding will encourage employment of graduates as Lead Educators across all ELC, not just in ECCE rooms as was the case with higher capitation payments.

Core Funding is calculated based on the hours that the service is open and available to children.

However, non-contact time is factored into the base rate in two ways.

Firstly, data from Sector Profile on current amount of contact and non-contact time for different grades of staff was used to build in an allowance for non-contact time into the allocation for staff costs.

Secondly, there is a separate allocation for administrative staff/time.

Although, the cost of delivery components 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 outlined in the Funding Agreement.

Approved areas of Expenditure:

• Costs relating to staffing of Partner Services in the provision of Early Learning and Care and/or School Aged Childcare (ELC/SAC), which may include non-contact time in preparation and review of ELC/SAC provision.
• Costs of participation in Continuing Professional Development relating to ELC/SAC including cost of cover for absence due to such participation.
• Costs relating to the administration of the service including the administration of schemes funded by Department.
• Overheads pertaining to running of the ELC/SAC service including rent, rates, utilities and insurance.
• Any other operational costs, excluding capital costs, which may reasonably be asserted to enhance the quality of ELC/SAC service provision.

Core Funding Year 3 will run from 1 September 2024 to 31 August 2025. An overview of changes to the allocation model, application module, and rules of the Core Funding scheme in Year 3 can be found here.

The additional €28 million of the Core Funding for year 2 is as follows:

• €8.47m is allocated towards funding the natural growth of the sector. This additional funding will support an increase in Partner Services; and also more staff working in the sector, more rooms and places, and more graduate lead educators and managers.
• €6.11m is allocated for non-staff overheads. This additional funding is a contribution towards non-staff overheads in recognition of the increase in non-staff costs faced by all
  services throughout the sector. This enhanced level of funding is aimed at increasing the sustainability of Partner Services, while continuing the Fee Management process that began in Year 1, which will further improve affordability for parents.
• €2.2m is allocated for administrative staff time. This additional funding is a contribution towards administration in recognition of the fact that the number of children supported through funding schemes is anticipated to continue to grow in 2023/2024. Non-contact/administration time is also factored into the base rate through the staff costs component.
• €4m is allocated to remove the year 3 experience requirement for the Graduates Premiums, underpinned by EROs.
• €7.22m is allocated for new targeted measures which are aimed at improving the sustainability of smaller and sessional Partner Services.

Age of child                                                  Value of Core Funding per place per hour
Full-time (5+ hours per day) and Part-time (3.5 hours – 5 hours per day)
0-1 year of age                                                                                         €1.69
1-2 years of age                                                                                       €1.10
2-3 years of age                                                                                       €0.95
3-6 years of age                                                                                       €0.71
Sessional (up to 3.5 hours per day)
0-1 year of age                                                                                         €1.69
1-2.5 years of age                                                                                    €1.10
2.5-6 years of age                                                                                    €0.68
School-age
4-15 years of age                                                                                     €0.57

Graduate premium rates per hour
Graduate Lead Educators in ELC                                                           €4.44
Graduate Managers in ELC or combined ELC and SAC                     €4.44

There will continue to be an allocation to contribute to support graduates to be Lead Educators across ELC and to support graduates as Managers in ELC or combined ELC and SAC services. The ELC Graduate Premium is calculated based on the number of ELC graduate Lead Educators in ELC rooms in the service; and if the ELC or combined ELC and SAC service has an ELC graduate as the manager. Both the Graduate Lead Educator Premium and Graduate Manager Premium rate will remain at €4.44 per hour.

As per the Employment Regulation Orders (ERO) that assigns a higher minimum pay to graduate lead educators and managers, in year 1 of Core Funding, to qualify their Partner Service for the Graduate Premiums under Core Funding a graduate Lead Educator or Manager had to have 3 or more years’ experience.

The Minister has allocated additional funding to support the removal of this 3-year experience rule for graduates in year 2. However, this will only be implemented if an equivalent change is made to the relevant ERO.

A flat rate allocation of €4,075 will be given to all services registered on the Tusla Register of Early Years Services as sessional only. This additional measure is only available to services with no other Tusla registration including School Age Registration on the Tusla School Age Register. This allocation is in addition to the services base rate and Graduate Premium. This allocation will be made to sessional-only services regardless of the level of Core Funding they receive. This measure will benefit approximately 1,700 sessional-only Partner Services.

Sessional services often attract less Core Funding in total because of their business model, which operates for shorter hours than most other service types. However, sessional provision is a key part of the overall early learning and childcare model in Ireland. Funding for sessional services increased on average in 2022/23, but less so than for other service types.

The independent review of sessional services has not been completed yet and emerging findings are not conclusive. Nonetheless, a targeted measure is considered in the best interests of all stakeholders and in acknowledging that sessional only provision as an important part of the early learning and childcare delivery model.

It is important to note, that the €4,075 is a full programme year amount, Partner Service that are in Core Funding for less than a full programme year will be allocated the appropriate number of weekly payments.

The minimum base rate allocation will be set at €8,150 for all Partner Services except childminders. This is the minimum amount of funding a centre-based Partner Service will receive from their Core Funding base rate and the flat rate allocation for sessional services where applicable. All Partner Services delivering centre-based provision, regardless of the size of their service, will receive at least this minimum base rate allocation2. All sessional services will receive at least €8,150, from their base rate and flat rate allocation combined (if they are in Core Funding for the whole year). This minimum base rate is not affected by the Graduate Premiums, which are applied on top of it and which will continue to operate as in year 1 (noting the removal of this 3-year experience rule subject to ERO).

The minimum base rate allocation applies to centre-based services only, i.e. not childminders. It is important to note that the €8,150 is a full programme year amount, Partner Service that are in Core Funding for less than a full programme year will be allocated the appropriate number of weekly payments.

There will be a new maximum base rate allocation of €600,000. Partner Services will not receive base rate funding beyond this maximum value. This measure will affect only a very small number of services, if any: no Partner Service is currently receiving above this maximum base rate and only six services are receiving more than €400,000. This maximum does not apply to the Graduate Premiums, which may still increase a Partner Service’s total allocation beyond this maximum base rate allocation.

Age of child                                                  Value of Core Funding per place per hour
Full-time (5+ hours per day) and Part-time (3.5 hours – 5 hours per day)
0-1 year of age                                                                                         €1.66
1-2 years of age                                                                                       €1.07
2-3 years of age                                                                                       €0.92
3-6 years of age                                                                                       €0.68
Sessional (up to 3.5 hours per day)
0-1 year of age                                                                                         €1.66
1-2.5 years of age                                                                                    €1.07
2.5-6 years of age                                                                                    €0.65
School-age
4-15 years of age                                                                                     €0.55

Graduate premium rates per hour
Graduate Lead Educators in ELC                                                           €4.44
Graduate Managers in ELC or combined ELC and SAC                     €4.44

The majority of Core Funding (i.e. € 212 million of the €259 million in Programme Year 1 (September 2022 – August 2023) is distributed based on a service’s capacity – the opening hours, opening weeks and the age group of children for whom services are provided as well as number of places available.

Core Funding allocations to providers are based on their capacity i.e. available places and not on child registrations or attendance.

Places do not have to be filled in order for Core Funding to be allocated. However, for capacity to be funded, the necessary levels of staff must be in place. The staffing required depends on the age group and session types of the places available. The capacity of a service is also limited by the regulatory space requirements.

Structuring Core Funding primarily based on capacity means that services have an allocation each year that do not fluctuate in line with children’s attendance. Providers have a stable income source based on the service they deliver.

Allocating Core Funding based on capacity in this way also closely links the level of funding available to the delivery costs for different types provision.

The exact formula is as follows:

1. Main Base Rate
Number of child places in an age group multiplied by value based on ratio that applies to age group in table multiplied by hours of operation per week multiplied by weeks open per year

2. Graduate Lead Educator Premium
Number of rooms led by a graduate multiplied by hours per week multiplied by weeks open per year multiplied by Graduate Lead Educator premium rate of €4.44, with a maximum of one Graduate Lead Educator premium per ELC room.

3. Graduate Manager Premium
Hours of operation per week multiplied by weeks per year the service operates multiplied by Graduate Manager premium rate of €4.44, with a maximum of one Graduate Manager premium per service.

The Core Funding application process consists of three stages:
•       Stage 1: completion of Sector Profile
•       Stage 2: completion of Service Profile and Core Funding Application Module
•       Stage 3: completion of Core Funding Partner Service Funding Agreement

The completion of the Sector Profile is a pre-requisite for application to Core Funding. The initial data collection window for the AEYSP closed at the start of May, however for a services which could not complete the survey over this period, this will not prevent them from entering into Core Funding. The AEYSP reopened on the 13th June 2022 and it will remain open so that services can complete the survey and apply for Core Funding throughout the whole programme year.

The application process for Core Funding opened on the 28^th of July. Partner Services’ Core Funding value based on the actual application data will be displayed immediately upon submission of the application, subject to final verifications.

Applicants should take all the time and care needed to ensure that the data they provide for the Service Profile and Core Funding Application Module is accurate, as they will be unable to edit this application after it is submitted.

The Funding Agreement, published on 29th June, was available to sign through the Early Years Hive in mid-August.

Payments will be made monthly in advance with the first payment in respect of September to be paid at the end of August.

As specified in the Funding Agreement, Core Funding will only come into effect and is contingent upon Employment Regulation Orders being in effect to cover all roles across the sector as defined in the Early Years’ Service Joint Labour Committee Establishment Order.

Core Funding FAQ is available here:

Click to access Core-Funding-FAQ.pdf

Core Funding Applicant Guidelines is available here: Core Funding Applicant Guidelines is available here:

Click to access Applicant-Guidelines-Final-27.07.2022.pdf

Core Funding Technical Guidelines is available here:

Click to access Core-Funding-Technical-Guidelines.pdf

Step 1: Pre Application Survey
Completion of the Annual Early Years Sector Profile (AEYSP) survey is a pre-requisite for application to Core Funding. The initial data collection window for the AEYSP opened in May and will close mid-June, however for services that could not complete the survey over this period, this will not prevent them from entering into Core Funding. The AEYSP reopens so that services can complete the AEYSP and apply for Core Funding throughout the whole programme year.

Step 2: June Review and Confirm (2nd – 12th of June)
Partner Services that complete the June Review and Confirm for Programme Year 2022/2023 will ensure that their Core Funding application data is as up to date as possible. Those Partner Services whose June 2023 Review and Confirm is approved, or subsequent approved application change, can avail of the option to auto-populate their Application Module for Programme Year 2023/2024, significantly reducing administrative burden. The option to complete a new application still remains to all Partner Services. Those who fail to complete this Review and Confirm will have to start their application for the next programme year anew.

Step 3: Service Profile, Application Module and Contracting
This stage will open in late June. Applicants will define and update their services profile if necessary and input their application data. Immediately on completion of the application, applicants will be shown key information on their grant value such as their funding allocation as per the Core Funding formula, broken down by week, month and year. This grant value displayed will be provisional and dependent on your application passing all relevant validations. This displayed grant value will not include the new targeted measures for 2023/2024, which your service may be eligible for. The Core Funding summary page will outline the targeted measures that may apply3, see questions 1.5, 1.7 and 1.11.

Once the application has been completed the service will be able to electronically sign the Core Funding Partner Service Funding Agreement for Programme Year 2023/2024, by doing so agreeing to operate their Partner Service in accordance with the terms and conditions outlined in the Funding Agreement in return for receiving Core Funding.

Step 4: Parent Statement
Partner Services will also be required to complete their Parent Statements online through the Early Years Platform. This functionality will become available in August, at the same time as the Review and Confirm window, but it is important to note that this is a distinct step.

Step 5: August Review and Confirm
Unlike last year, a new Review and Confirm window will take place in August 2023. For this programme year, Core Funding applications must be validated and approved prior to payments being made to Partner Services. Partner Services will also be required to complete their Parent Statements online through the Early Years Platform.
Core Funding payments to your service will begin once your application has passed all relevant validations, your August Review and Confirm process is complete and approved, and your parents statement is received.

There are a number of scenarios where services may be applying for Core Funding for the first time in Programme Year 2023/2024. Requirements will differ slightly depending on the timing of a services application.

In general, new applicants for Core Funding in Programme Year 2 will be required to undertake steps 1, 3, 4 and 5 outlined in “How does a Core Funding Partner Service reapply for Core Funding for Programme Year 2023/2024?” to complete their application. Applicants who join after August will not need to complete step 5 but will need to complete subsequent Review and Confirms as they arise.

Services are encouraged to contact Pobal/CCCs for support in completing their Core Funding applications.

Yes, completion of the Sector Profile is a necessary requirement in order to access Core Funding. The Sector Profile will capture essential information at a service and sector level to provide a baseline to assess the impact of Core Funding. As in previous years, the data collected in the Sector Profile provides vital insight to track and monitor trends and identify key issues in the sector.

The Sector Profile is available on the HIVE. City and County Childcare Committees are available from to assist and support with completing the Sector Profile if necessary.

There are two types of Graduate Premiums available under Core Funding: the Graduate Lead Educator Premium and the Graduate Manager Premium.

The Graduate Lead Educator Premium in Core Funding is paid as a top up on the number of hours of provision that is led by a graduate with a relevant qualification and three years’ experience.

The Graduate Manager Premium is paid as a top up on the number of hours of operation of a service whose manager is a graduate with a relevant qualification and three years’ experience.

The Minister has allocated additional funding to support the removal of this 3-year experience rule for graduates in Programme Year 2 (September 2023 – August 2024) however this will only be implemented if an equivalent change is made to the relevant ERO.

A Lead Educator is defined as an Early Years Educator who leads practice with a group of children. The term ‘Lead Educator’ is used to reflect the important pedagogical leadership role played by these individuals with a group of children and with other Early Years Educators who are also working with that group of children. Previously this role was often termed ‘room leader’. The term ‘Lead Educator’ will be relevant to groups of children of all ages in centre-based ELC settings. For the purposes of Core Funding, each ELC room can only have one Lead Educator at any one time; even if the children are organised into groups within the room.

A Manager refers to the person in charge of a setting, as defined in the Early Years Regulations 2016 and SAC Regulations 2018, i.e. ‘the person who has day-to-day charge of the service’. This person may or may not be the Registered Provider. While ELC and SAC services vary considerably in their legal and organisational structures, every service must – as a condition of its registration – have a designated person in charge (here termed the ‘Manager’) who is responsible for the daily running of the service and – unless deputised by a named person – must be on the premises at all times when the service is being carried on.

Changing the approach to funding ELC Graduates:
1. Extends support for the employment of Graduate Lead Educators outside of the ECCE programme to ensure that children in other parts of ELC have the opportunity to benefit from graduate-led provision.
2. Allows for a Graduate Premium to be paid in respect of Managers of ELC or combined ELC and SAC services. This is because of the strong evidence of the importance of graduate leadership in shaping quality for children.
3. Brings the financial support for Graduate Lead Educators more closely in alignment with the costs of delivery for that type of provision.

ECCE higher capitation had been paid on the basis of the number of children participating in the ECCE session, not the number of hours of ECCE being led by a graduate. For example, an ECCE room with 22 children currently receives 2.75 times more higher capitation funding than an ECCE room with 8 children. In both cases, the graduate Lead Educator is providing the same amount of hours of service.

Core Funding provides an opportunity to rectify that disparity as well as extend funding for graduates beyond the ECCE programme to other aspects of ELC provision.

For this reason, the Graduate Lead Educator Premium in Core Funding is paid as a top up on the number of hours of provision that is led by a graduate, rather than the number of children that are participating in that room.

Core Funding addresses some of the previous disparities in funding levels across ECCE and non-ECCE provision, providing funding proportionate to the age range of children being cared for and supporting the employment of Graduate Lead Educators and Graduate Managers across ELC services.

While Core Funding operates in addition to and alongside ECCE standard capitation, NCS, AIM, and CCSP, it replaces ECCE Higher Capitation and incorporates funding previously allocated to the discretionary Programme Support Payments (PSP) from September 2022.

Instead of ECCE Higher Capitation, a Graduate Premium is a feature of Core Funding. This makes a payment to ELC services in respect of Lead Educators across ELC and Managers with a graduate qualification and the requisite experience.

Extra funding to support administration costs is also contained within Core Funding. This means that the budget previously allocated to PSP, with an increased allocation, is now incorporated into Core Funding.

PSP was paid annually in arrears. This meant that, subject to eligibility and conditions, services got a PSP payment in July 2022 for the 2021/22 programme year. From the 2022/23 programme year PSP was no longer be available as the budget has been incorporated into Core Funding.

The Expert Group report recognises that SAC is a central element of the sector. The report emphasises the importance of a unified approach across the sector – both ELC and SAC – and this has been applied in the new funding model.

Core Funding is open to stand-alone SAC services as well as SAC provision that is delivered in combination with ELC.  The majority of Core Funding is distributed via the base rate, based on the capacity the service is offering.  The allocation for SAC services is €0.55 per child place per hour.

Currently, there is no minimum qualifications requirement and no list of approved qualifications for SAC and therefore SAC services cannot avail of a Graduate Premium. Combined ELC and SAC services with a qualifying Manager will receive a Graduate Manager Premium.

The role of Lead Educator also does not apply to the SAC sector. As set out in Nurturing Skills, “the working title for those working in centre-based SAC is ‘School-Age Childcare Practitioner’”. Therefore, only ELC sessions can have a Graduate Lead Educator Premium when led by an ELC Graduate.

Nurturing Skills commits to the provision of part-funded places on flexible education programmes at levels 6 to 8 for Early Years Educators working in the sector. This new funding will support upskilling and strengthen career development pathways for those working in the sector, reducing the cost to educators of undertaking further and higher education qualifications. The new funding will also develop and introduce mechanisms for providing financial support to services to help meet the costs of releasing staff to go on student practice placements and study leave. Plans for the new funding scheme are currently being developed.

This planned new funding for educators to upskill is in addition to supports that are already in place for workforce development.

DCEDIY has, and continues to provide, a number of funded training initiatives for early years educators. Funded CPD programmes under the National Síolta Aistear Initiative (including both introductory workshop and the Aistear and Play CPD programme), AIM training (such as EDI training, Hanen, Lámh, and the Sensory Processing E-Learning programme) and other training are fully funded and available to early years educators at no cost. In addition, DCEDIY funds the Leadership for Inclusion (LINC) Level 6 special purpose award, and participation in this is also available at no cost to early years educators.

Funding is also available for staff working in services who have achieved a qualification at level 7, 8 or 9, through the Learner Fund Graduate Bursary.