Canada’s $10-a-day daycare program: A guide for families

How much does daycare cost in Canada?

The high cost of child care is a significant concern for many Canadian families—except perhaps in Quebec, which already has an affordable child care system in place.  

The average Canadian family spends nearly $10,000 per year on daycare—for a single child—and those who live in urban areas often spend much more. This makes child care one of the biggest expenses for young families.

The high cost of child care is likely one of the reasons many couples choose not to have children. More worrisome is that families sometimes spend years on wait-lists, unsure whether they’ll get into a daycare facility at all. The introduction of $10-a-day child care could alleviate some of parents’ concerns regarding affordability and accessibility. 

How does $10-a-day daycare work?

The goal of the national child care program is to provide affordable and inclusive child care for families at an average cost of $10 per day.

To achieve this, provincial and territorial governments—supported through an initial $30 billion in federal funding over five years—are working to create 250,000 new child care spaces across Canada by 2026. Through the program, parents of children enrolled in a qualifying daycare facility are eligible for a partial and graduated reduction in child care fees. Daycare facilities can choose not to participate. In Ontario, around 92% of licensed child care sites had opted into the system as of November 2022.

Parents whose children attended a participating facility between April 1 and Dec. 31, 2022, should receive a credit or rebate of up to 25% on their daycare fees. In 2023, the rebate increased to 50% of child care fees, and the government plans to continue reducing fees until an average of $10 per day is achieved in 2026. 

Once it’s fully implemented, the national child care program is expected to grow Canada’s economy, improve employment numbers among women and help young children participate in early-childhood education programs.

Eligibility

Parents and guardians don’t need to apply for the fee reduction. You may qualify for reduced child care fees if you meet the following criteria: 

• You currently pay more than $12 per day for child care. 
• Your child is under the age of six. 
• Your child is enrolled in a licensed child care facility that is participating in the national child care program.

Potential savings

The amount you will save depends on the fees charged by your child care provider. Below are the government’s estimates for the average annual savings per child with $10-a-day daycare in place compared to the fees in 2019.  

What impact will the program have on families?

The $10-a-day child care program will have a significant financial impact on young families in Canada by making child care more affordable. Families in Ontario and British Columbia, for example, can expect to save more than $9,000 per year compared to 2019. That means more money for other big expenses, such as housing, transportation and food. 

Affordable daycare could have other ripple effects, too. Couples who are unsure if they can afford to have kids might feel more confident about starting a family. This is especially true for those thinking about having more than one kidFewer mothers may feel the need to leave the workforce to care for their children, as so many did during the pandemic. And this would positively impact the finances of families overall.

What should you do with the rebates you receive?

Depending on the amount you currently pay for daycare, CWELCC could translate to thousands of dollars back in your pocket. Here are a few ways you can put that money to good use:

• Contribute to your child’s registered education savings plan (RESP).
• Pay down debt (e.g., mortgage, car loan or credit card).
• Build your emergency savings fund.
• Put it toward other savings goals (e.g., an annual family vacation).

My experience with $10-a-day daycare

When I found out I was pregnant in the fall of 2020, my husband and I researched several child care providers in our neighbourhood and put our names on numerous wait-lists. We did online research and went on tours to meet the staff and see the facilities first-hand. From there, we anticipated spending an eye-watering $23,400 on daycare in the first year alone. 

We live in a major city and needed infant care (as opposed to toddler care)—two things that come at a premium. So, we came up with a plan. We opened a new savings account and stashed money away every month. Having a head start helped lessen the financial burden we knew we would face.

We also put together a chart comparing the fees of daycare facilities that either opted into or opted out of CWELCC. The difference added up to tens of thousands of dollars over several years. Not knowing whether our preferred facility would ultimately enroll, as a backup plan we put our names on several wait-lists for toddler care rooms. Fortunately, our child care provider did opt into the program last fall.

Currently, we are patiently waiting for our 2022 reimbursement—we anticipate getting roughly $3,500 back. And the new 50% reduction for 2023 will amount to around $11,500 in savings. With the rising cost of living, it’s a financial relief to get this money back. We’ll be putting it to good use by redirecting it toward our child’s future education.  

Looking ahead

Overall, I believe $10-a-day daycare will be beneficial for current and future families, who stand to save a small fortune on child care. The program comes with the added benefit of helping parents stay in the workforce, earn income and build financial security. It’s a blessing for parents and will hopefully provide a great educational start for young children. 

Read more Making It columns:

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• Take control of your finances with these budgeting tips for young adults
• How to improve your credit score

• How to manage money as a student

About Sandy Yong

Sandy Yong is a personal finance writer, TEDx and Keynote speaker, and the award-winning author of The Money Master. She’s been featured in hundreds of media outlets including CTV News, Global News, Forbes, The Globe and Mail and The Toronto Star.

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