Childcare providers set to leave government funding schemes and increase fees, Government warned

Earlier this month, three major providers of childcare, including one in Cork which caters for 450 children, also signalled their intention to leave the government funding scheme.

More childcare providers are set to leave government funding schemes in a matter of weeks and increase fees, the Government has been warned.

According to Tusla figures, around 3,700 are engaged in the government's core funding model, which is a grant to Early Learning and Care and School Age Childcare providers to support them in meeting operating costs. In recent years, providers in that system have agreed to freeze fees in exchange for increases in the subsidies available, though latest figures show that 900 childcare providers within the Government's funding system have increased their fees this year.

Over 20% of childcare providers who, as part of the Government’s core funding model, have been prevented from increasing their prices in recent years, can apply for a fee increase assessment if their fees were “frozen at a level that may not be sufficient to sustain their business, even with the increased funding available through core funding”.

According to the minister for children Norma Foley, there were 11 services around the country who withdrew from the Core Funding scheme in 2024, but recent reports suggest the 2025 figure is higher. One provider of multiple creches, Once Upon A Time, last month told parents it would leave the scheme citing rising costs. This will result in fees increasing to €1,472 per month in Dundrum, €1,390 per month in Shankill and €1,300 in Ballymount, parents were told. 

Earlier this month, three major providers of childcare, including one in Cork which caters for 450 children, also signalled their intention to leave the scheme.

However, with providers due to renew their involvement in the core funding model by the end of this month, a representative body has warned that more will leave the scheme.

Elaine Dunne, of the Federation of Early Childcare Providers, said that more providers "will withdraw before the end of August".

"A lot more will withdraw. Multiple site providers are pulling out, but what about the small ones? They're the ones that are closing entirely.

"What they are giving us in core funding is not covering the cost of doing business. Our members are tired and they're angry. They're tired of receiving press releases that they're not being consulted on."

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Ms Dunne said recent suggestions that the Department of Children is examining expanding the ECCE are evidence that the sector is not being listened to.

"The numbers do not add up and some of us are stuck at 2016 fees," Ms Dunne said.

In a recent parliamentary response, Ms Foley said her department "continues to support services through Core Funding".

She said that from September, the funding is set to be worth over €390 million "contingent on the establishment of new minimum rates of pay in the sector through updated Employment Regulation Orders".

"It is a matter for individual providers to decide whether they wish to participate in the Core Funding scheme, the significant financial supports it offers to providers and the certainty it gives to parents through the associated fee management. However, I am confident that there is a sufficient level of investment ad associated supports to make participation attractive.

"Indeed, 99% of community services participate," Ms Foley said.