Question Period Note: Canadian Centre for Policy Alternatives (CCPA) report on ELCC in Canada

The CCPA released a report on October 26 regarding the current progress of the Canada-wide ELCC Agreements and the impacts federal investments are having in communities across Canada

In Budget 2021, the federal government announced more than $27 billion over five years to build a Canada-wide early learning and child care system with the provinces and territories.

Thousands of families are already benefiting from the system and fees have been reduced, with almost half of our provincial and territorial partners delivering ELCC for an average of $10-a-day or less.

We welcome this report from the Canadian Centre for Policy Alternatives and will continue to work to ensure all families in Canada have access to affordable child care, no matter where they live.

If pressed on provincial goal status/achievements

Our goal is that all families in Canada have access to an average fee of $10-a-day for regulated child care by March 2026.

Nearly half of Canada’s provinces and territories are already delivering regulated child care for an average of $10-a-day or less, and the others have reduced parent fees by at least 50%.

If pressed on widening gap between for-profit and public spaces

Canada-wide ELCC Agreements predominantly support licensed not-for-profit, public, and family based child care, but, given the unique ELCC landscape across the country, Canada recognizes that for-profit child care also plays a role.

The Canadian Centre for Policy Alternatives (CCPA) report “Measuring Matters: Assessing Canada’s progress toward $10-a-day child care for all” provides an update on the CCPA’s survey of child care fees that is has carried out since 2014. This addition of the survey is the first since many jurisdictions achieved their target of 50% fee reductions – see the table below for the current status of fee reductions.

The CCPA’s report looks at the status of fee reductions in 37 municipalities across Canada, and information is gathered directly from child care providers using a telephone survey. Only fee data for full-day, full-time child care is included in their analysis, and fee reduction measures such as subsidies, tax credits or other deductions that offset or replace fees are not included in their calculations.

The report found that overall, results show that Canada is making “solid progress” in offering affordable child care. However, child care remains expensive in big cities (Richmond, B.C., Calgary, and Toronto). Full-time child care fees are lowest in cities where provinces have moved to set fees across all age groups (cities in Quebec, St. John’s, Winnipeg, Saskatoon, Regina, and Iqaluit). In some cities — Toronto or Richmond, B.C.— many parents pay much more than the median fee reported. The gap between for-profit and not-for-profit fees has widened, especially in high-fee cities with many for-profit centres. Half of the cities analyzed have no extra capacity to accept new children in the next week.

The report includes four recommendations including a swift transition to a set-fee model with a maximum daily fee of $10 by 2025-26 across all provinces and territories to enhance transparency, efficiency, administrative simplicity, and equity, while also recommending that provinces and territories include income-based adjustments to replace existing subsidy systems. Additionally, the report recommends that each province and territory establish expansion strategies to meet the targeted affordable public and non-profit child care space goals. To address the growing disparity between not-for-profit and for-profit fees, the report recommends that expansion should focus exclusively on public and non-profit providers, with a call for robust public accountability measures. Furthermore, the report highlights the need for public funding to become the primary revenue source for child care programs, emphasizing the importance of operational funding models and improved compensation for the workforce within these systems.

Additionally, a number of providers who are not participating in the Canada-wide early earning and child are (CWELCC) system are included in the CCPA’s calculation of median fees. Rural providers and providers in smaller municipalities are not included in the analysis. Median fees calculated at the city level are also weighted by the size of the provider – larger providers count for more against the calculation of the median fee. More information on the calculation of fee reductions and estimated savings can be found in the footnotes of the table below.

It should be noted that the commitment by provinces and territories to reduce their fees by 50% and to $10-a-day are provincial, not municipal, level commitments and the calculation of these fee reductions may vary according to the way in which these reductions are delivered (e.g., some provinces include the use of subsidies in the calculation of their average daily fee). It should also be noted that because provinces and territories have committed to $10-a-day on average, some have put $10 flat fees in place, while other families may pay more or than $10-a-day due to the target being an average across a jurisdiction.

Current Status of Fee Reductions

Province / Territory

Status of Fee Reduction

Estimated Annual Savings per Child (Gross, Annual)1

BC

50 per cent on average reduction achieved as of December 2022

Savings of up to $6,600 per child

AB

50 per cent on average reduction achieved as of January 2022

Savings of up to $10,3302 per child

SK

$10-a-day effective April 1, 2023

Savings of up to $6,9003 per child

MB

$10-a-day effective April 2, 2023

Savings of up to $2,610 per child

ON

50 per cent on average reduction achieved as of December 2022

Savings of up to $8,5004 per child

NB

50 per cent on average reduction achieved as of June 2022

Savings of up to $3,900 per child

PEI

50 per cent on average reduction achieved as of October 2022

Savings of up to $2,000 per child

NS

50 per cent on average reduction achieved as of December 2022

Savings of up to $6,0005 per child

NL

$10-a-day achieved as of January 1, 2023

Savings of up to $6,300 per child

YK

Yukon committed to a $10-a-day average fee prior to Budget 2021

Savings of up to $7,300 per child

NWT

50 per cent on average reduction achieved as of January 2022

Savings of up to $4,950 per child

NU

$10-a-day achieved as of December 2022

Savings of up to $14,300 per child

QC6

Under its asymmetrical agreement, Quebec has committed to creating 30,000 new child care spaces by March 2026.

1 Estimated savings for BC, AB, SK, ON, NB, PEI, NS, NL, and NWT are provincial and territorial estimates. Remaining savings calculations (MB, YK, and NU) are Employment and Social Development Canada estimates and are illustrative only. All estimates are relative to 2019 levels unless updated data is provided by provinces and territories. All estimates are based on out-of-pocket parent fees excluding amounts that would be recovered through provincial/territorial tax credits or the federal child care expense deduction at tax time, or changes to provincial/territorial or federal benefits as a result of lower child care expenses. Actual savings for families will vary based on factors such as actual fees paid prior to reductions. Provincial and territorial methodologies and data for calculating estimated savings may vary.

2 Based on Alberta’s savings scenario of a family earning $130,000/year previously paying $1,200/month for infant care and now paying $339/month.

3 Based on Saskatchewan’s average savings estimate of $573/month for full-time infant care as of April 2023.

4 Based on Ontario’s savings scenario of a family paying $62-a-day per child at the beginning of 2022 and $29.30-a-day effective December 31, 2022.

5 Based on Nova Scotia’s savings scenario for an infant in full-time licensed child-care.

6 The Government of Canada has entered into an asymmetrical agreement with the province of Quebec that will allow for further improvements to its early learning and child care system, where parents with a subsidized, reduced contribution space already pay a single fee of less than $10-a-day.

The Government of Canada made a transformative investment of over $27 billion over five years, as part of Budget 2021, to build a Canada-wide early learning and child care system with provinces and territories. Combined with other investments including in Indigenous Early Learning and Child Care, up to $30 billion over five years will be provided in support of early learning and child care. Adding previous investments announced since 2015, this means that as of 2025-2026, a minimum of $9.2 billion will be provided every year – permanently – for Early Learning and Child Care and Indigenous Early Learning and Child Care.

The goal is to bring fees for regulated child care down to $10-a-day on average by March 2026. By the end of 2022, the Government is aiming to reduce average fees for regulated early learning and child care by 50 per cent to make child care more affordable for families. These targets apply everywhere outside of Quebec which already has an affordable, well-established system, and Yukon which has already achieved a $10-a-day system.

The Government of Canada has signed agreements with every province and territory to deliver a Canada-wide ELCC system. All of Canada’s provinces and territories have announced child care fee reductions to support the affordability goal of the Canada-wide ELCC system.

Canada has signed an asymmetrical agreement with Quebec, where prices are already affordable through its well-established system.

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