Budget 2026 will not relieve pressures on settings

Early Childhood Ireland has voiced deep concern over Budget 2026, stating that it fails to adequately address the persistent challenges in Early Years and School Age Care. Without the introduction of targeted measures to relieve staff recruitment and retention difficulties, progress will remain stalled, and thousands of children will continue to sit on waiting lists for an Early Years place. Parental fees that far exceed the levels promised in the Programme for Government are set to persist.

What we asked for

Early Childhood Ireland’s 2026 Budget Submission had one significant proposal. We called on the government to name a date to bring Early Years and School Age Care graduates’ pay in line with primary school teachers, who are trained to the same level.

Giving our graduates pay parity with primary school teachers would give recognition to the vital role that the Early Years and School Age Care workforce plays in children’s lives. It would provide security and stability to educators and settings, thus reducing turnover, which is currently at 25%, nationally. Above all, it would benefit children by improving their accessibility to quality and inclusive Early Years and School Age Care services.

Budget 2026 measures announced

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Early Childhood Ireland has raised the following concerns:

Overall Budget allocation

With just €125 million added in Budget 2026, bringing the overall allocation for Early Years and School Age Care to €1.48 billion, this figure falls far short of what’s needed to ensure that every child is guaranteed access to high-quality Early Years and School Age Care in their community.

Ireland spends less than 0.2% of its Gross Domestic Product (GDP) on Early Years, compared to 0.9 % of GDP, on average, across OECD countries[1]. If the government were to bring our Early Years and School Age Care investment level up to the OECD average, it would need to spend approximately €4.8bn (2024 figures) per year.

Capital funding

€36m (2% of the overall funding allocation) in capital funding will be provided in 2026. This funding is intended for the following:

• A new programme of acquisition and fit-out of state-led Early Years and School Age Care settings to meet demand for affordable and accessible places. With a particular focus on full-day provision for younger children, 700 additional places are expected in 2026 under this new programme.
• A new Building Blocks Extension Scheme will open in 2026 for extensions and modifications to existing premises. This will deliver approximately 1,500 places.

While capital funding is always welcome, the 2,200 additional places that are projected to be delivered is nowhere near the estimated 14,000 shortfall of places needed for children under the age of five by 2030. We are also concerned that the Building Blocks Scheme is restricted to existing services only, creating a barrier for new services, particularly in areas of unmet demand or need.

Staff recruitment and retention

Staffing is the single biggest challenge facing Early Years and School Age Care settings, with some areas having a staff turnover rate of 52%. In her Budget 2026 press conference, the Minister for Children, Disability and Equality, Norma Foley TD, stated that the ring-fenced Core Funding for the current and future Employment Regulation Order (ERO) for Early Years and School Age Care educators “will help unlock around 17,000 unused places which can’t be filled due to lack of staff.” Despite the recent increase in the ERO rates, the workforce will continue to be on relatively low pay and poor working conditions, making it stubbornly difficult to free up those places and to attract staff into Early Years and School Age Care. Our system will continue to lose highly qualified staff to other sectors with better pay and conditions.

Fees

Parents will be particularly disappointed that there was no increase in the National Childcare Scheme (NCS) subsidy, which means that fees will remain at current levels. Furthermore, it will be months before details on the new maximum fee cap for parents paying the highest fees across the country will be published.

The Early Years and School Age Care system needs a considerable amount of state intervention to improve daily challenges, such as staff recruitment and retention, capacity, and fees for parents. These challenges are impacting on children, restricting many from accessing Early Years and School Age Care. Bringing our Early Years and School Age Care graduates under public sector pay and conditions would have significantly alleviated these pressures, allowing the focus to return to the children who benefit from this vital provision.

If you would like to get in touch, or have any queries about our work, please contact policy@earlychildhoodireland.ie

[1] OECD, 2024. Education at a Glance 2024: OECD Indicators, Paris: OECD Publishing