Childhood Services Ireland welcomes ERO outcome but warns of ongoing cost challenges for childcare sector

June 04, 2024

Childhood Services Ireland, the trade association representing early childhood providers, welcomes the Employment Regulation Order (ERO) for early years educators. The ERO gives early years educators certainty over their wages.

“We worked with the Joint Labour Committee to develop a wage rate that worked for the sector. We are pleased that our staff have a level of certainty over their wages” said Regina Bushell, Chair of Childhood Services Ireland Council.

While providers welcome the ERO, they also expressed a need for caution. Parent fees have been frozen since 2021 for those availing of core Government funding. The fee freeze coupled with the increase in operating costs since entering core funding has created a crisis in the sector with many providers needing to close rooms just to stay open.

“Our fees have been frozen in many cases at 2017 levels while operating costs have increased at least 35% over that period. Providers are facing enormous cost pressures from inflation, increased energy costs and interest rates and government legislation adding additional costs. We have no mechanism to raise revenue, which has led many providers to make difficult decisions to close childcare rooms. Other providers have pulled out of core funding in order to create the breathing space needed to keep their businesses sustainable. For the providers that have no option but to pull out of core funding it will mean an increase of fees to parents of at 25-30% as there is now a legal requirement to meet a minimum level of pay” added Bushell.

The sector is at a crisis point with many providers indicating that they will have to close rooms or pull out of core funding while others have said they may be forced to close their doors.

“We cannot plan for our businesses when we have no idea what core funding will look like for the upcoming year. It is June now and government has yet to give any indication as to how core funding will be allocated for the 2024-2025 year. We are delivering early learning and care, yet we are the last to know how the government will allocate our resources to operate.”