Children play at the Blessed Chiara Badano Child Care Centre in Stouffville, Ont., in May, 2025.Nathan Denette/The Canadian Press
In news that should shock no one paying the slightest bit of attention, the province of Ontario will not meet its joint target with Ottawa for expanding subsidized child care in the province.
Ottawa gave the provinces, territories and Indigenous groups $35-billion over five years to reduce the average out-of-pocket cost for parents to $10 a day a child by March, 2026, and to create 250,000 daycare spaces in the country. The program’s purpose is laudable: to enable more women to join the work force, boost the economy and improve the lives of children in the critical early years.
Unsurprisingly, the plan has not worked as intended, in Ontario or anywhere else. Unsurprising because Ottawa seems determined to replicate the public policy woes of Quebec, which discovered three decades ago that heavily subsidizing a service rapidly increases demand. And unsurprising because the federal Liberals chose to spend heavily on the vote-grabbing strategy of dramatically reducing fees for a lucky minority of families rather than focusing on the unglamorous work of increasing supply.
Ontario says the one-year funding extension it secured will allow it to keep average subsidized fees at $19 a day, nearly double the target, at least until the end of next year.
A report last month from the federal Auditor-General made clear the shortcomings of the program.
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In the first three years of the program, just 112,165 new regulated child-care spaces were created across Canada. The audit notes that about 69,000 more a year will be needed over the next two years to meet the 250,000 target. At the current pace, that’s unlikely to happen.
Flexibility will be needed. But there is some success to build on. Out-of-pocket costs for parents within the subsidized system fell to an average of $16.50 across Canada as of March, 2024. The report notes that five provinces and three territories met the $10-a-day target and other provinces were on track to do so. Families fortunate enough to secure a subsidized spot save hundreds of dollars a month.
But those who have not got a place for their kids are out of luck and languish on waiting lists that stretch to several years in some parts of the country. The federal audit notes that 156,500 parents and guardians said they had difficulties finding care in 2023, a 23-per-cent increase from 2020, the year before the launch of the federal subsidy program.
To help accelerate the pace, the private sector’s role should be reconsidered, as a number of provinces have urged. The program places a 30-per-cent limit on for-profit spaces. Seventy per cent must be non-profit in order to qualify for federal funding. Ontario has asked the federal government to remove the cap, complaining that municipalities have had to turn down thousands of child-care spaces in the program. Peel Region, for example, has rejected more than 2,000 potential new spaces because the operators were private.
Ottawa, some unions and child-care advocates say non-profit operators provide higher quality of care. But some of the objections are ideological – that the expansion of for-profit child care diverts public money to corporate profits.
A reality check is needed. According to a 2021 Statistics Canada study, women owned 85.9 per cent of child-care firms as of 2016. And the overwhelming majority of child-care operations are small and unincorporated. Less rigidity around the role of the private sector would alleviate the pressure on waiting lists and support women entrepreneurs.
Another lack of flexibility is the type of care generally on offer. The vast majority of kids are placed in centre-based care, which operates during daytime hours, an arrangement that favours the laptop class.
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The audit notes that families face difficulties in finding care that accommodates their work schedules or children’s special needs. Shift work, weekends or late hours are common in many sectors. But options are limited for part-time, overnight, evening and weekend care. More child-care spaces with more flexible hours would address an equity issue that often places working class families at a disadvantage.
The Netherlands is an example worth emulating. Dutch parents enjoy care that is subsidized but flexible. Even grandparents who babysit regularly are considered providers. Parents are eligible for a government allowance.
Canada needs that kind of flexibility, rather than the current rigid approach whose shortcomings become more obvious by the day.