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The national daycare program promised by the Liberals underestimates its costs by billions, according to a Cardus analysis. Register file photo

Feds’ daycare plan falls short, says Cardus

  • May 15, 2021

OTTAWA - The federal government’s much-hyped national daycare plan will cost up to four times the price tag the Liberals promised in its recent budget, according to the religious think tank Cardus.

While the Liberals peg the cost of a national system at $9.2 billion annually, that figure is only about one-quarter of the actual cost, said the religious think tank in its analysis of financing estimates, and would burden the provinces with most of the costs.

“The system would realistically cost an estimated $36.3 billion per year,” according to the Cardus position paper “Look Before You Leap” authored by Cardus’ Andrea Mrozek, Peter Jon Mitchell and Brian Dijkema. “This factors in the desires of public advocates for a Quebec-style system.”

Cardus has been critical of Quebec’s government-run provincial daycare system since it was established in the late 1990s, costing parents $10 a day for a child-care space.

The federal plan announced in the budget on April 19 sets a goal of $10 a day per child across the country within five years. Finance minister Chrystia Freeland said the federal investment of $30 billion over five years will help drop the average child care fees by up to 50 per cent in the next 18 months.

“The federal government assumes a 50/50 cost share with the provinces, but these deals have not yet been signed. Since the federal funding is set for the next five years and the real costs of a national daycare plan are significantly higher than what the federal government is proposing, the provinces would end up covering the lion’s share of the cost, forking out as much as $23.3 billion annually. In Ontario alone, the real cost of implementing such a system would be $9.5 billion annually,” claims Cardus.

“It’s not just about the high and growing costs of a system, it’s about a high level of complexity in a country as diverse as Canada,” said Mrozek, adding “frankly, provincial governments will dodge a bullet if they reject the federal proposal and demand flexible funding that responds to all parents’ needs instead of the federal plan.”

Cardus has repeatedly called for tax credits or direct funding to parents so they can ultimately decide how child-care funding for their children should be spent.

“Supporting parents directly is the equitable way to help all families, regardless of the type of care arrangement they use, including caring for their own children.”

Mrozek, a senior fellow at Cardus, said a national system based on the Quebec model will funnel billions in funding to a system that will not allow parents to decide for themselves what kind of child care they want for their children.

“Federal policy should maximize the flexibility of families to make varied choices across the country, emphasizing respect for these choices and decisions in the arena of caring for children,” she said. “Families know how to make the choices that work best for them.”

The “Look Before You Leap” analysis expresses concern “with how national daycare will meet the needs of Canadian families, whether it can provide quality care for children efficiently and equitably, and whether it can address the diversity of care needs across a country as large as ours.”

“The national plan as currently conceived provides no assistance, and may indeed harm, other forms of care that children are now receiving due to arrangements made with family members, neighbours and community, as well as home-based and centre-based providers — forms of care that parents are choosing because it is what works best for them and for their child,” Cardus argues.

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