Sligo-Leitrim childcare providers sound warnings over potential closures

Childcare providers across Sligo and Leitrim have penned a letter to the Children’s Minster over concerns relating to a new requirement for “Detailed Financial Reporting”, a condition for availing of Core Funding.

They’re warning that increased interference in their practice, amplified by these requirements, may lead to widespread closures of services in Sligo and Leitrim.

A new committee has also been formed locally to challenge the issue.

Core Funding was introduced in the School year 2022-2023, in order to help cover the costs associated with operating childcare services on behalf of the state, and has been paid to participating services since September 2022.

Providers were asked to enter into contract with the Department initially in August 2022 and to reaccept in August 2023 to facilitate the introduction of a pay rise.

However they say it came as a shock to eventually fine out the extent of detail the Department wanted. Providers say it’s still unclear exactly what information the Department wants, nor how we are to submit them.

They say they will not be in a position to meet the Minister’s demands by the March 22nd deadline nor have they been informed of the consequences of not complying.

The group of providers have written to Minister Roderic O’Gorman informing him of their concerns, and outlining practical solutions to the issue.

They are also calling on all local elected representatives to stand with them to save these vital local services.

The providers group is asking that the Minister postpone the requirement of the chart of accounts in their current form until all issues have been resolved.

The letter to Children’s Minister Roderic O’Gorman:

We, the undersigned, are a group of small, independent providers of Early Childhood and School Aged Care, both Community and Private, based in counties Sligo and Leitrim.

We are increasingly concerned about the demands placed upon us by your Department, specifically regarding requirements surrounding the so-called Chart of Accounts.

We understand, and appreciate, the requirement to account for tax payers’ money and acknowledge that the Core Funding contract called for Detailed Financial Reporting. What the contract did not make clear was that a specific format would be required and what that format would be.

Below we will detail our alternative proposals to meet the requirement for Detailed Financial Reporting. However, before we outline our solutions, we must first address our concerns, some of which you may already be familiar with.

Currently our accounts are prepared along the basis of a calendar year and submitted to Revenue, either through our accountants or individually. Revenue accepts these figures on the basis of trust and, should that trust be found to be misplaced, consequences ensue. Why does your Department require our accounts to be submitted by a Chartered Accountant? Do you not trust us with money? You trust us with the nation’s most precious asset, its children.

No training has been provided by County Childcare Committees in relation to the changes announced via the County Childcare Committee on 24th November 2023.

There is a disparity in the reporting procedures for self employed persons and limited companies. Services registered as limited companies, both private and community, can submit the wages of all staff, owners, and managers whereas self employed and partnerships cannot. The “profits” of the self employed and partnerships are their wages. They pay tax on this with revenue, yet they cannot submit this as data in the current format. This discrepancy will produce false data results implying that these businesses may appear to be making a profit whereas, in fact, they are doing no more than drawing a wage.

Requiring us to prepare these accounts during the academic year takes our leaders, frequently the graduate workforce you have asked for, from our important work with children and forced us into our, often non-existent, offices.

A number of us, especially those with smaller services, do not and never have had accountants. Even those of us with accountants have found it difficult to get accountants prepared to quote for the work. Why? Because the details of what exactly is required and how exactly it is to be submitted are still not clear. The deadline for submission is currently 22nd March. Today’s date is 6th March.

The contract which we signed with your Department is unfair in at least 2 respects, the power imbalance between your Department and our services plus the lack of detail given about your requirements at the time of signing – a new detail was not explained properly and the potential costs of this change were not highlighted within the contract.

Had we realised, at the time of signing, what the consequences were, none of us would have entered Core Funding. This funding, which is negligible to smaller services, has turned out to be a poisoned chalice.

There is no clear information available from either Pobal, nor the County Childcare Committee regarding the consequences of not meeting your Department’s interpretation of the requirements.

We will now outline our solutions.

There exists, upon the Hive, a system through which Community Services make Finance and Impact Returns on a quarterly basis. Our Detailed Financial Reports could be submitted through a similar form, completed by ourselves.

Our accounts, as submitted to Revenue, could be accepted along the lines of the calendar year, rather than the academic year.

If your Department persists in insisting that submissions are made by Chartered Accountants, then these Accountants should be provided by your Department. The cost of this exercise should also be covered by the department. A list of available accountants could be sent to providers, with these accountants billing your department directly, thereby providing further financial transparency.

Any future significant changes introduced in a contract should be clearly outlined and explained at the time of signing.

Adequate and in-person training, by qualified trainers who understand the new system should be provided.

We declare that neither the requirements as set out by your Department, nor the submission date are acceptable nor feasible and we, the undersigned will not be in a position to meet either.

We strongly suggest that you listen to your “partners”.

Yours Sincerely

Louise Hayden, Little Flower Montessori.

Emer Logan, Lifestart Childcare.

Yvonne Stewart and Louise McLoughlinn, Cosycats Childcare.

Mary Clyne, Miss Mary’s Montessori School.

Claire Devine and Louise Stewart, St. Molaise Preschool and Afterschool.

Jackie Mahon, Little People’s Playworld Creche.

Ciara O’Rourke, Toadstool Cottage.

Catlin Egan, Busy Bees Daycare.

Mary Clinton, The School House.

Aishling Munnelly, Stepping Stones.

Grace O’Boyle, Magic Moments Montessori School.

Brid Ferry-Mulligan, Kilmacowen Community Preschool and Playgroup.

Gerardine Reynolds, Miniworld.

Stephanie McGarry Poirier, La Petite Ecole Montessori.

Kelley Sweeney, Acorn Montessori School.

Sandra Loftus, Happy Days.

Sharon Warnock, Little Meadows Nursery.

Veronica Muldowney, Collooney Montessori School.

Aolish Gormley, Réalta Beaga Pre School.

Grainne Shanley, Pebble Lane Preschool.

Geraldine Mousa, Kevinsfort Kids Academy.

Lucy Davey, Farmyard Miniworld, Ballintogher.

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