The chief executive of one of the country’s largest childcare providers has warned that they might need to let some staff go because of a delay in core funding which was agreed last December.
The funding agreement of €221 million was to ensure no increase to fees this year above September 2021 rates.
However, the Department of Children recently told childcare providers that it was not certain the EROs (Employment Regulation Orders) would be in place at the start of September.
Karen Clince, founder of Tigers Childcare and chair of the Fingal Childcare Committee told national radio that the delay to core funding could push the sector further into crisis. Childcare providers could not continue "to haemorrhage money" and her company had a duty to protect the 2,000 children for whom they provided childcare.
Ms Clince said the Interim Funding scheme being proposed in the event that the Core Funding is not in place on September 1st goes nowhere near plugging the gap needed to pay for increased staff costs as well as hikes in utilities, maintenance and administration costs.
Ms Clince explained that childcare providers were already hiring staff at the improved rates of pay of €13 per hour, (an increase from the previous rate of €11.70) based on the core funding kicking in from September 1st.
The interim funding now being promised by the Department would amount to approximately half of what was expected under the core funding scheme, she said. This would put a lot of providers under pressure with many, potentially, being forced to let staff go or to close rooms in order to protect their business.
“Some may even have to cease business altogether,” she said.
The planned supports by the Government were not coming fast enough, she added. People were expecting to enter the sector at the €13 wage level, but employers had not yet received that money. In the meantime inflation rates and other costs such as utilities were going up.
The proposed interim funding was not enough to cover wages which have “spiralled out of control”. There was no guarantee that childcare providers would not increase their rates, she said.
“It’s a very difficult situation to be in.
“We already face serious challenges attracting and retaining staff and this further exacerbates an already critical situation. Even if only delayed until the end of September, a month is a very long time in the childcare business.
“We also have had to tell our staff that they won’t receive the expected wage increase from September, which has left many disheartened.
“And with new recruits demanding rates according to the newly recommended pay scales, we have to pause recruitment until we can have the required funding to pay these new rates.
A stipulation of core funding is that providers are unable to increase prices to cover rising costs. Ms Clince called for an increase in the amount allocated through interim funding and certainty on how long it will take for the EROs to be approved.