We’re paying for $7/day child care, so why is only one province getting it?

Many Canadians don’t know that Quebec has the least expensive childcare in the country at $7/day (well actually $7.30 now). Meanwhile in Toronto parents pay $49/day, and in Vancouver it’s $41 a day for toddlers/preschoolers.

It’s no surprise that $7/day childcare is wildly popular in Quebec. It’s far cheaper than the national average, and allows for more parents, and far more women to enter (or re-enter) the workforce. It also creates more spaces in regulated centres.

In Canada, there are a million families with working parents who have young children. However, there are only half a million regulated child care spaces, leaving parents with long wait times and an increased reliance on the unregulated sector.

CCPA-ChildCareGraphic-Facebook

As of the fall of 2014, the federal government is spending the equivalent cost of $7/day childcare through the Universal Child Care Benefit (UCCB) and income splitting—untargeted programs that won’t create a single child care space.

The federal Universal Child Care Benefit (UCCB) was “enhanced” by providing it to households with six to 17 year olds for their “child care”, and by giving a $60/month top-up to those with children under five. As the Parliamentary Budget Office points out, more than half of the new UCCB is paid to families who not only have no child care expenses, but whose teenage children are highly unlikely to require any type of child care at all.

As for income splitting, 89% of all families won’t benefit from it. The largest benefits from are going to high income families. Meanwhile, single parent and working class families gain very little or nothing at all.

And these programs are expensive. The UCCB, enhanced UCCB and income splitting will cost the federal government $7.1 billion in 2015 (net of income taxes: SPSDM 22.1). This scattershot approach of sending cheques to rich families, families not using child care, and families with teenagers in the hopes that some might land in the right hands will not deliver value for the money.

Here’s the kicker, Quebec spends $2 billion each year on $7/day childcare. The federal government in 2015 will spend $7 billion on UCCB, enhanced UCCB, and income splitting. That $7 billion would buy the rest of the country the same $7/day childcare program (to end up at the total $9 billion in Table 1).

Table 1: Estimated $7-a-day childcare costs

Year 2011 2011 2011 2015
Geography Quebec Rest of Canada Canada Canada
Children 0-4 440,840 1,436,255 1,877,095 1,930,725
Cost $mil for $7-a day-childcare (Over and above what is spent today via subsidy programs, includes tax write-offs) $1,911 $6,226 $8,137 $9,059
Cost per child aged 0-4 $4,335 $4,335 $4,335

$4,692

Assumes similar regulated space coverage and participation rates

Sending cheques to wealthy households (income splitting) or to families with teenagers (enhanced UCCB) is very costly but does not deliver affordable childcare. For that you need a concentrated program.

There is a real choice here: a UCCB cheque worth ~3 days of childcare and a chance at income splitting crumbs OR a cross-Canada $7/day childcare system. A more targeted approach would fulfill a genuine need for modern Canadian families and it would do so by simply focusing money we’re already spending.

David Macdonald is a Senior Economist with the CCPA. Follow David on Twitter @DavidMacCdn.

11 comments

  1. Great article and info graphic but misleading title- it suggests that the rest of Canada is funding the cost of Quebec ‘ s program.

  2. I completely agree with this that we need to do the 7 dollars a day for childcare and have more affordable childcare for families who require it. I am a Early Childhood Educator and now that I have a child I think it’s absolutely ridiculous parents pay anywhere from $800 to $1500 for infant care.
    I have to put my child in daycare and know when I decided to have another it won’t be worth going back to work.
    I also know many parents who would rather collect the minimal amount of welfare than go back to work because it saves them more money to stay home. This is also costing our government and province so much.
    They say the first 5 years of a child’s life is when the brain grows the most and takes in the most information. They are forming into the person they are meant to be. If we as adults know that they learn the most in the first 5 years of life why are we not investing in our children’s future at a young age.

  3. Vanessa,
    It’s more than a bit ironic that childhood educators actually don’t make enough/fees are too high for them to put their own 2 kids in daycare!

    1. After reading this, I have to take back my excitement that I had expressed few months ago. I also updated my facebook status to now, express my opinion of what I call, “injustice” on a bigger scale. Simply put, yes we do need extra money, to help us raise our children, but the $60, just won’t cut it, if we are paying too much for the Day Care. If we all follow Quebec’s investment on Day Care, thus, allowing working parents to work, but not completely broke (at the end of the day) by paying day care this much money — then I would be doing my happy dance. Thanks for this article, this is an eye-opener for me.

  4. Good article. Over the last couple years of hearing about the $7 child care system, I’m very curious to understand the child care provider side of this story. The reason child care is so expensive is because to run a properly licensed home daycare it costs a lot of money, and the provider ends up making significantly under minimum wage even with the high-cost to parents and families. Does this $7 a day child care system subsidies the child care provider and early child education industry to allow them to charge less to the parents, but still make a fair wage?

  5. The have prov ar paying for this throught the transfer payments… Also Que also has the highest personal taxes plus prov taxes.. so it really is not $7 day care….. The west is getting upset with the have not prov offering srvices Que really can’t offord… cheep colage and university cost is an other…

    1. Rob,
      I hope the above has illustrated that $7/day childcare is not free! You have to pay your taxes. But what I hope the above shows is that you’re already paying for it, its just badly targeted.

  6. I get that this strengthens women’s equality and opportunity in today’s society. That’s the best long term investment to come out of the daycare push. But isn’t the idea of wanting to send babies to daycare the opposite of what most really want? The Conservative party investment for staying home with kids is clumsy and more philosophical than effective but isn’t it still a laudable characteristic of a society? Move to flex time jobs, shorter working hours, earlier start to schooling, programs to keep cost of housing in check, society perks for stay at home parents like parking spots at front and vip wait lines. Many of them spend considerable time helping our schools so their kids should get priority program placement. Make it cool to be stay at home. Wouldn’t it be possible if 90% did it (and equal female/male) that society and economy would balance out?

    The numbers also don’t add up so runs risk of selling something ($7/day daycare) that’s not true. What costs $7 in Quebec is not going to cost that in Vancouver or Toronto. ~$5000 per kid is $20/working day. Price in Vancouver is $40/day. How does that give everyone $7/day? Start small and test a few different models in the big city then ask the government for millions of dollars.

  7. I think the income splitting was better, but I will take what I can get. Not all moms work outside the home, so programs like this, benefit those of us who struggle on one income. And I just read several posts from people who previously lived in Quebec. They said the quality of childcare there is really awful – so therefore there are other “costs”.

  8. In Saskatchewan, I am on 25 waitlists and have no hope of getting a space. Therefore, I am splitting my son’s time between an unregulated dayhome provider and a babysitter who comes to our home. It is costing $3500/month and I’ve had to cash in my RRSPs. And I worry all the time with my son in unlicensed care. However, I do not want to give up my career and go on welfare. I am keeping my fingers crossed that something will come up before I run out of money; otherwise I will have to send my child to live with family out of province until we win the daycare lottery (i.e. get a space).

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