Daycare for under $10: How Canada eases the burden on parents

As Susana Ibarra’s maternity leave came to an end and she prepared to return to her office outside of Toronto, she still faced a major challenge: finding care for her son and then figuring out how to pay for it.

Finally, after putting him on a dozen waiting lists, she got a spot. In fact, it came at a discounted rate of 600 Canadian dollars, or $450, per month.

The low cost was the result of an ambitious daycare plan expanding across Canada, designed to dramatically reduce fees that supporters say will address one of the most vexing issues facing many working parents.

“It was just the perfect timing,” said Ms. Ibarra, who returned to work in January as a paralegal at a tax office in Mississauga, a Toronto suburb. She had heard many stories of colleagues who stopped working when they had children because childcare costs were exorbitant.

The National Daycare Plan was introduced two years ago by Prime Minister Justin Trudeau’s government with the aim of steadily reducing childcare costs so that tens of thousands of childcare places would be available by 2026 at a daily rate of 10 Canadian dollars. about $200 a month, or less.

By comparison, in major metropolitan areas such as Toronto or Vancouver, childcare can cost $1,200 or more per month, or about $60 per day.

The federal child care program is “a transformative project at scale with the work of previous generations of Canadians, who have built a public school system and public health care system,” the federal government said in a statement when the program was unveiled.

Working with the country’s provinces, which are responsible for education and childcare, the federal government plans to spend up to 30 billion Canadian dollars to create a total of 250,000 new low-cost childcare spaces, mostly in non-profit organizations or public daycare centers centers and family providers.

Childcare providers use government funding to reduce their fees over time until they reach the $10 Canadian per day threshold.

Daycare centers in five of Canada’s 13 less populous provinces and territories have already cut rates to that level, while the remaining provinces, including Ontario, have slashed their rates in half on their way to $10 a day.

So far, around 52,000 low-cost childcare places have been created nationwide under the program.

“This is part of our plan to make life more affordable for the middle class and for people who work hard to get in,” Trudeau said in March when announcing the expansion of the program in Manitoba.

While the program was critically acclaimed, it encountered growing pains as demand for discounted childcare slots outpaced supply and providers struggled with labor shortages.

By making childcare more affordable, many working parents, especially women, don’t have to choose between their careers or raising their children, say childcare advocates and researchers. Studies have also shown that low-cost childcare is an economic boon as it increases women’s labor force participation.

“Not only is this very good for our economy, not only is it very good for gender equality and for women in the workforce, but it is also very good for setting our children up for success,” said Karina Gould, Canada’s Minister of Families . , children and social development.

Among the richest countries in the world, European countries dominate childcare policy rankings.

A UNICEF report Two years ago, a measurement of, among other things, the costs of maternity leave and day care showed that nine of the top 10 countries were in Europe, led by Luxembourg. (Canada ranks 22nd, while the United States, which spends far less on childcare than most other wealthy countries, ranks 40th.)

Rosanne D’Orazio and her husband moved from Montreal to Iqaluit, the capital of the sparsely populated northern Canadian province of Nunavut, more than a decade ago, where she said childcare was eating up much of her wages from working for an Inuit association .

But last December, childcare fees for her 3-year-old daughter fell to $10 a day after county daycare centers began cutting prices as part of the federal program.

Ms. D’Orazio, who also has a son, 7, and whose husband is a freelance photographer and videographer, decided to change careers.

With monthly childcare reduced from $1,500 to $200 Canadian, I had “the flexibility and financial freedom,” she said, “to leave my nine-to-five practice behind and become a consultant” to Indigenous organizations.

The Canadian program is based in part on a similar initiative in Quebec that started 25 years ago. Parents there pay about 9 Canadian dollars per day for government-subsidized childcare.

Proponents say the program has pushed more women into work. Nearly 90 percent of women in Quebec are part of the labor force, the highest female employment rate in any Canadian province.

The program has also strengthened the province’s economy: Quebec’s gross domestic product is 1.5 percent higher than it would have been without the program, according to research by Pierre Fortin, emeritus professor of economics at the Université du Québec à Montréal.

“We’re sure there are big benefits for families and there are benefits for the economy, so that’s what convinced the Canadian government to follow Quebec’s example,” said Gordon Cleveland, professor emeritus of economics at the University of Toronto, which has advised the federal government on its childcare program.

One of the biggest challenges for childcare providers that are part of the federal program is accommodating parents who want to enroll.

“I knew the parents I help would need this program,” said Susie Beghin, the owner of Alpha’s Discovery Kids, which operates three daycare centers in what she described as working-class communities outside of Toronto.

The centers serve 270 children and have a months-long waiting list of parents looking for a discounted slot.

The surge in demand has exacerbated existing problems in Canada’s child care sector, including labor shortages and concerns about low wages. Some critics worry that the Trudeau administration is investing a significant amount of money in a program that will serve a relatively small number of children.

Others say more parents would benefit if the government expanded existing childcare tax breaks instead.

“Despite the best intentions of the federal program, I fear it will anchor an expensive, poor-quality program that serves a minority of children” and underestimates the cost and complexity of providing childcare, said Peter Jon Mitchell, director of the family program at Cardus, a research group.

Some daycare providers say the program has made it harder to raise wages because once they receive government money, they can’t increase their fees and federal funding doesn’t cover all of their expenses.

“That has limited the capacity of existing programs and has also made expansion all but impossible,” said Morna Ballantyne, executive director of Child Care Now, an advocacy group. “You just can’t run programs without staff and you can’t run quality programs without qualified staff.”

But for many families, the low-cost daycare program has been a welcome relief.

Ms. Ibarra, whose partner works as a delivery driver, had been willing to shell out as much as $1,300, or $970, a month for her 18-month-old son, Ethan, the regular expenses of the nursery where he is enrolled.

By paying about $600 a month, she said, “it was a really easy choice to go back to work” and was able to build up her savings.

Roopal Khandelwal moved from Delhi to Toronto in February when her husband took a new position at his company. They have a 2-year-old son, Avik, and are expecting a second child in August.

Finding a discounted day care slot for Avik means Ms Khandelwal, 32, a specialist in digital marketing, can get back to work.

“I have a big two-year break on my resume,” Ms Khandelwal said. “I look forward to giving a fresh start to my career.”