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The program, which aims to make child care more affordable, has faced hurdles. The pullback from some daycare centres leaves families with few options.
The Canada-Wide Early Learning and Child Care plan (CWELCC)—the Canadian government’s mission to create 250,000 new and affordable child care spaces across Canada, at an average cost to families of $10 per day by 2026—has been the subject of heated debate on social media, in infant play groups and at daycare centres across the country.
While imperfect, the $10-a-day system has been widely applauded for making child care more affordable and equitable for more Canadians. And it looks like it’s here to stay, as legislation that commits the federal government to funding the system long term is poised to become law. However, the national daycare plan is facing some big challenges, including a still-limited number of spaces and the widely reported closures of child care centres that can’t cover their costs.
“Supply is still insufficient to meet the urgent demand for affordable child care spaces,” says Morna Ballantyne, executive director of Child Care Now, a group that advocates for publicly funded child care. “The early learning and child care sector is undergoing major change.”
Families who were fortunate enough to secure a subsidized spot for their child and receive rebates for their fees are estimated to save thousands per year: as much as $6,780 annually per child in Nova Scotia and $9,390 annually per child in British Columbia, for example. If a daycare centre were to pull out of the program, or even shut down, these families would be left scrambling to find affordable child care.
The goal of the national child care plan is to provide affordable and inclusive care for all families. To make this happen, provincial and territorial governments made funding deals that have rolled out in stages, starting with daycares that elected to join the program and freeze their fees in March of 2022. This was followed by a series of refunds to parents via a child care fee subsidy (whose details vary by province and territory). Currently, CWELCC-participating daycares continue to reduce their frozen fees, with a plan to get the cost down to $10 per day by 2026.
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Operators in multiple provinces are threatening to pull out of the system—and some have already gone back to their old private fee structure or closed their doors. They say the federal-provincial agreements, which limit the fees they can charge, are not providing enough funding to cover their costs. Daycares that opted in to the program at the outset are still receiving funding coverage to match their revenue at that time, but as inflation neared an annual average of 4% over 2023, the governments’ top-up of less than 3% has been insufficient. As a result, many daycares have faced a shortfall, and some say they have been saddled with unsustainable levels of debt.
A group of operators in Alberta, led by the Association of Alberta Childcare Entrepreneurs, held a series of rolling closures in early February to bring attention to the issue. The Alberta government has since promised changes to the funding model, including affordability grants and a streamlined payment process for daycare operators.
In Ontario, under the province’s current funding model, the YMCA, the largest licensed daycare provider in the province, says it’s running at a loss of $10,000 to $13,000 per year for each infant in its care. The YMCA has said it hoped to see a new funding formula in the fall of 2023, but that hasn’t materialized. A spokesperson for Ontario Education Minister Stephen Lecce has said the province is pushing for more federal money.
In other parts of the country, particularly in big cities where the cost of living is high, the story is much the same. An analysis by Cardus, a public policy group, said the rollout of child care expansion programs in British Columbia, Saskatchewan and New Brunswick have all been slow to start and have had underwhelming results. In its first year, New Brunswick only created 300 new child care spaces, which is barely a dent in its five-year target of 3,400 additional spots. While the funding to cover operating costs—which have been on the rise due to inflation—is a major piece of the puzzle in many areas, it’s just part of the problem. Staffing daycares is the other issue.
In Toronto, many programs are working at reduced capacity, limiting their enrollment because they cannot employ enough early childhood education (ECE) workers. “Qualified educators are leaving the sector because of the very low compensation paid, and it is very difficult to find or recruit replacements,” says Ballantyne. “The staffing crisis is a major obstacle to expanding the child care sector and is the leading contributor to temporary or permanent program closures.”
In Ontario, the deadline for daycare centres to opt out of the subsidized program for 2024 has passed, but some may back out in 2025, and others might simply close in the meantime.
Families don’t always have a lot of time to respond. In Toronto, for example, child care centres must give the city only 60 days’ notice of their withdrawal from the program. (They are required to inform families immediately.) The options for impacted families include coughing up several hundred dollars more per month for the same care, having one parent leave the workforce, or finding an alternative to licensed daycare.
For families left without a coveted spot, short-term or long-term solutions could include a home daycare, hiring a nanny (or sharing a nanny with another family), or asking a relative to help with child care. In most major cities, nannies and babysitters charge an average of $18 per hour, which is a far cry from the $10-a-day plan.
The CWELCC plan was billed as a social commitment as much as an economic one. “Many studies have shown, and many parents have confirmed, that lack of access to affordable child care undermines the economic security of families, and lowers the earnings of mothers in particular,” says Ballantyne. “Without access to affordable child care, parents—and most often mothers—must drop out of the paid labour force, take extended leaves and/or reduce their work hours.” A $10-a-day program could do wonders for working parents, but it isn’t going to help much if daycares can’t afford to participate.
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