Dear Provider,
As you will be aware, applications for the Core Funding Scheme 2026/27 opened on 8 June and many providers have already contracted for the scheme for the coming programme year, with applications rates for this year on par with previous years.
In contracting for the scheme, some providers have sought clarification on the additional €45 million in ringfenced funding allocated to Core Funding in year 5 of the scheme, i.e. the Staff Funding Annual Contribution 2 (SFAC 2) – both the value of the SFAC2 for individual providers and the timeline for release.
The Department and the Minister have always made clear that the €45 million in available funding through the SFAC 2 is specifically ringfenced for supporting Partner Service with the cost of increasing pay that may arise from an updated Employment Regulation Order.
Please be aware, the SFAC2 allocation is currently not included in the Core Funding allocation generated as part of the current application process.
It can, however, be calculated using the following formula, with an hourly rate of up to €1:
Minimum Annual Staffing Hours multiplied by the SFAC2 hourly rate.
As communicated previously, the SFAC2 funding will be released once new Employment Regulation Orders are established, or on 1 September 2026, whichever is later. However, the Department is aware that no updated Joint Labour Committee (JLC) proposals have been negotiated currently.
Therefore, regrettably, at this point in time, no SFAC 2 funding can be dispersed as part of Core Funding allocations. In line with public expenditure rules and regulations, unused funding will be returned to the Department of Public Expenditure, Infrastructure, Public Service Reform and Digitalisation therefore the SFAC 2 will not be eligible for backdating.
However, if an agreement can be reached through the independent JLC process, SFAC 2 funding can and will be dispersed as soon as the relevant Employment Regulation Orders are established as the functionality is available within HIVE. Please also be aware that SFAC 1 funding will still issue as normal.
As the JLC process is independent of the Department, for information on the process, please contact your appropriate representative organisation. The current member organisations of the JLC are Childcare Services Ireland and The Federation of Early Childhood Providers as the representative bodies for employers and SIPTU as the representative body for employees.
For information on other updates please review our What’s new for Partner Services in Core Funding Year 5 document at the link here core-funding-2026-2027-overview-of-changes-for-providers-year-5-final.pdf