Parents prefer affordable daycare over individual financial assistance: report

From left to right, Maria Novikova and Alina Kractsova are two young mothers from Ukraine who have been unable to find a daycare centre with space for their children (Judy Trinh, CTV News)

Canadian parents would have a strong preference for affordable, $10-a-day licensed child care over individual payments delivered to them from the government, according to a new report.

Released Thursday by the women’s economic empowerment charity The Prosperity Project, the report recognizes that there are still long waits for licensed daycares, but makes the case for expanding spaces in the program instead of scrapping it for a family-allowance model.

The report is authored by Gordon Cleveland, an economist and early childhood researcher at the University of Toronto. Cleveland conducted a series of focus groups with parents, analyzed available data from Statistics Canada and provincial figures. In reaching his conclusions, Cleveland also compared existing studies on child care in Canada and abroad and took a deeper dive into the Quebec experience which has had subsidized daycare since 1997.

It calls the Canada-wide Early Learning and Child Care program implemented by the Liberal Government “a victim of its own success,” noting that the possibility of affordable fees has pushed demand ahead of expansion.

“A national childcare system is really the way to go, and now is not the time to back up. We're seeing the benefits, not only for women to go back to their employment, but also for children,” said Prosperity Project executive director Julie Savard-Shaw said in an interview with CTV National News.

“The program has been successful at reducing the costs for parents."

Savard-Shaw says impetus for commissioning the study was rash of recent reports from think tanks advocating for a family allowance model. Savard-Shaw says she expects that costs associated with a national subsidized daycare program will be an issue in the next federal election.

The Canada Early Learning and Child Care Act, which received royal assent in March, enshrines into law the Liberals’ progress on its cornerstone commitments, including bilateral agreements between the federal and provincial governments for $10-a-day care.

Researchers do not know exactly how many children are benefitting from day care that costs $10 per day, but the latest Statistics Canada data reveals that about 938,000 children who are between zero and five years of age are using accredited child care services where fees have been reduced by at least half due to of the Canada-wide program. Citing figures from 2023, the study reveals that there are 65,000 more children enrolled in licensed daycare centres than in 2021.

According to Thursday’s report, if the existing $10-a-day system — which eight provinces have already implemented through a bilateral agreement with the federal government — were scrapped in favour of direct financial payments to parents, most families would be worse off.

The report states that a family allowance program would result in “dramatic inequalities of access” and turn child care again into a market service with high fees and low staff wages.

Such allowances would also require payments of at least $12,500 per child per household, according to the report, which also estimates the change would cost the government more than triple what it currently pays to ensure affordable daycare.

The national daycare program is expected to cost the federal government more than $9 billion dollars in transfer payments to the provinces and territories in 2025-26. But replacing it with a family allowance program would cost Ottawa over $28.5 billion, annually.

The report also notes that fewer than half the needed child care spaces have been created thus far.

“Action plans signed by the provinces and territories promise that there will be anexpansion of 250,000 licensed spaces by the end of the five-year period, but somewhat fewer than 100,000 of these spaces are committed or built to date,” writes Cleveland in the report.

Maria Novikova, a young mother who moved to Ottawa last year from Ukraine, is among the thousands of Canadians on day-care wait lists for their child. Novikova says she wants to focus on improving her English and to find work to help support her family, but is unable to do so because she cannot find a licensed day care that has space for her two-year-old daughter, Mira.

“It’s a hard impact … If I can find a job, maybe we’ll be more happy, because it’s hard to be with kids all the time. And for kids, it’s the same. They need activities and they need friends,” said Novikova, who has been searching for a day care for eight months.

The Prosperity Project report states that all levels of government should shift strategies to meet the needs of mothers like Novikova.

“Initially, the focus was on reducing fees. And now, the focus needs to be on creating more spaces and hiring more educators,” said Savard-Shaw.

Among the recommendations in the report to create thousands of more daycare spaces across Canada are calls to extend parental leave for fathers and drop the age of eligibility for kindergarten from five years old to four. Only kids in Ontario and Quebec start kindergarten at age four.

Quebec, which has had the most affordable child care program in the country for the longest period of time, also has a workforce participation rate for women that is 13 per cent higher than the rest of Canada.

"We have the data. Investing in child care yields a high economic return,” said Savard-Shaw.

“When women succeed, we all do.”