Groundbreaking ideas and research for engaged leaders
Rotman Insights Hub | University of Toronto - Rotman School of Management Groundbreaking ideas and research for engaged leaders
Rotman Insights Hub | University of Toronto - Rotman School of Management

3 years after Canada’s landmark investment in child care, 3 priorities all levels of government should heed

Read time:

Elizabeth Dhuey, Heather Read

Three years ago, the federal government announced the multi-billion-dollar Canada-wide Early Learning and Child Care plan, with its cornerstone focus on reducing child-care costs to an average of $10 per day for all Canadians by 2025.

Each province and territory signed an agreement pertaining to federal funds for quality, accessible and affordable care systems. In Quebec’s case, that province established universal child care in 1997. While supporting the general principles of the federal plan, and receiving its share of funds, Quebec retains sole responsibility for early learning and child care.

Provinces and territories risk repeating the mistakes made in Quebec if the focus remains on a quick increase of availability of low-cost spaces without attention to quality and a carefully planned roll-out.

Funding and how it’s allocated

Three years after the launch of the federal early learning and child-care plan, things do not appear to be going as planned. It has been widely reported that space targets across the country will not be met by 2026.

Some Ontario daycares have been forced or are threatening to close due to financial pressures of the agreement. This includes large organizations like the YMCA.

Other daycares or organizations are pulling out completely, causing abrupt increases in fees for families.

In British Columbia, waiting lists have ballooned. New Brunswick has asked to reopen negotiations with Ottawa to increase for-profit centre participation to try to meet space targets.

Prime Minister Justin Trudeau recently pledged additional funding via grants and loans to public and not-for-profit child-care providers prior to the release of the 2024 federal budget. But the issue is not only funding, but how it’s allocated.

Quebec: Important lessons

After Quebec’s universal child care program rolled out, a focus on low fees and a push to rapidly increase spaces resulted in a tiered system. This has meant parents choose between higher-quality, not-for-profit centres with long waiting lists — or more accessible but lower-quality for-profit providers. Such for-profit providers emerged in 2003 to meet space demands, following an initial for-profit moratorium.

Additionally, in Quebec, lower-income families face significant challenges in accessing care. Children from low-income families are under-represented in high-quality centres.

While Quebec’s program helped increase women’s participation in the workforce, its overall effects on children and their families has been quite mixed, with some studies finding negative effects on both.

These findings raise significant questions about the quality of programs found in Quebec, since researchers have documented that high-quality child care programs consistently generate positive child outcomes. Such were the findings of an analysis of 30 studies using similar research designs as were used in Quebec.

Although the Québec program remains popular as a policy talking point and with parents, researchers acknowledge that its implementation and current state leave room for improvement.

What to prioritize

Federal and provincial governments must work together and prioritize the following areas:

1. Quality assurance: In child care, quality matters, and it matters a lot. Creating a system that ensures high-quality care without draining excessive resources is of the highest importance. Fortunately, positive examples exist worldwide.

In Luxembourg, child-care centres must fulfill certain criteria, such as adopting the national curriculum and multilingual education program, adherence to ongoing professional development standards and periodic assessments to receive government support.

In Singapore, centres can qualify for extra subsidies beyond the usual public funding by participating in the Preschool Accreditation Framework, which involves increased scrutiny and assistance to enhance quality.

Domestically, Toronto centres seeking to serve children on subsidy must agree to be part of the city’s quality assurance and improvement system. Programs like these incentivize quality care that prepares children for future education, and they can and should be standardized across Canada.

2. Not-for-profit centres with well-paid staff: Building on the importance of quality, not-for-profit providers are key. Research shows for-profit child care centers tend to offer lower-quality services and are more likely to close.

Australia provides a cautionary tale here: they relied on a private corporation for its child-care strategy, which ultimately collapsed and required a bailout in 2008.

Should Canada follow this path, we would risk the same outcome. However, even a year ago there was significant growth in for-profit centres, and private sector-friendly provincial governments, such as Alberta and Ontario, are pressuring Ottawa to allow more of this.

In addition, the workforce is already grappling with well-documented staffing shortages. As child care becomes more widespread, there will be a growing demand for well-trained and experienced professionals. This highlights retention as another key concern, with low pay as a key issue. Wages need to be high enough to attract and retain workers. Trudeau’s plan to earmark $48 million to extend student loan forgiveness and $10 million to train more educators is a step in the right direction.

3. Priority to low-income families: The federal early learning and child-care program has hugely increased demand for care. However, when services are limited, vulnerable families experience access challenges. Without careful policies, lower-income families may be squeezed out of the market, exacerbating pre-existing inequities.

Time and again, studies have shown that children from these families are most likely to benefit from quality care. By prioritizing their access, child care can break the cycle of poverty.

Incentives should be created for providers to set up centres in low-income neighbourhoods to make child care accessible to disadvantaged communities.

4. Better child care for all: As all levels of government continue the important work of reforming and expanding child care in Canada, and face significant time pressures to do so, quality must remain the cornerstone of such a strategy, with particular attention given to low-income families.

All levels of government must create incentives and structures for providers to develop and maintain quality care environments and to attract well-trained educators. The focus cannot solely be on the comparatively easy path of increasing spaces as rapidly as possible. The goal is not just more child care all over Canada, but better child care for all.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Elizabeth Dhuey, is an associate professor of economics at the University of Toronto with a cross appointment to the Rotman School of Management. 
Heather Read is a research co-ordinator for the Education and Training for the 21st Century research cluster at University of Toronto Scarborough.