Prior to the Auditor-General’s report, released Wednesday, Premier Doug Ford defended the program but said Ottawa needs to provide more funding to the province.DARRYL DYCK/The Canadian Press
Ontario is facing a shortfall of nearly $2-billion to maintain the $10-a-day child-care program next year, and fees may have to go up without additional funding from the province or the federal government, according to a new report on the program from the provincial Auditor-General.
The province’s agreement with Ottawa expires March 31, 2026. With six months to go, Ontario has not yet signed an extension, although it has agreed to one in principle.
First announced in 2021, the Canada-wide Early Learning and Child Care agreement aims to reduce fees across the country to an average of $10 a day by 2026. Cost-sharing arrangements necessitate financial deals between the federal government and the territories and provinces.
Every province and territory has signed extensions with the federal government, with the exception of Ontario, Saskatchewan and British Columbia.
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Alberta has said it wants an income-tested system and more public funding allotted to for-profit providers.
Saskatchewan has said it wants more input from child-care operators before making a final decision, and it wants to see the federal plan address before- and after- school programs.
Prior to the Auditor-General’s report, released Wednesday, Premier Doug Ford defended the program but said Ottawa needs to provide more funding to the province.
“We need the federal government to step up,” Mr. Ford told reporters at Queen’s Park.
“We look forward to renewing our agreement with the federal government. We look forward for them to be putting more money in. But child-care compared to a few years back, it’s night and day. It’s less than half the cost.”
Ontario has received more than $10-billion in federal transfers to date to help reduce costs for families, said Jennifer Kozelj, press secretary for Patty Hadju, Minister of Jobs and Families, in a statement to The Globe and Mail.
“The federal government remains focused on working with provinces and territories to lower child costs and ensure that Canadians are empowered to fully participate in the economy,” she said.
Ontario has reached its goal of reducing fees under the child-care agreement but has fallen short on other targets, including creating child-care spaces and increasing the number of qualified child-care employees.
The province had created 75 per cent of the child-care spaces it had targeted to create by the end of 2024, the report said.
For the work force, Ontario would need to add 10,000 registered early childhood educators by December, 2026, according to the report. Before Ontario signed its agreement with Ottawa in 2022, parents paid an average of $48 per day for a child-care space in Ontario.
As of this year, fees have been capped at $22 per day for children under 6. To achieve the program’s stated goal of an average of $10 a day by 2026, current funding is insufficient, the report found, with the province facing a shortfall of $1.95-billion.
“The long-term sustainability of the program is uncertain,” the report states. “Families need to know what will happen in April 2026, which is only six months away, and the years beyond so they can plan for their child-care costs.”
Ontario Education Minister Paul Calandra said he will review the auditor’s recommendations.
But without an infusion of funding from the federal government, the province won’t be able to meet its child-care commitment, he said.
He said Ontario has yet to meet with the federal government on the issue but has spoken to other provinces, such as B.C., Alberta, Saskatchewan and Manitoba.
Mr. Calandra added that the rigidity of the program is also part of the problem.
“There are spaces that are not being used because the federal government insists that it is used through the not-for-profit sector,” he said.
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Currently, only 30 per cent of CWELCC spaces can be operated by for-profit providers.
Allowing more for-profit providers to participate in the program would help to create many more spaces, said Andrea Hannen, executive director of the Association of Day Care Operators of Ontario, which represents both not-for-profit and for-profit child-care operators.
“You’ve got centres that are run as small businesses sitting there with spaces vacant,” she said.
Demand for child care in Ontario has ballooned since the CWELCC program was announced in 2021.
In 2019, there were 22,000 families in the province not using child care because of a shortage of spaces. That number grew to 69,000 by 2023, according to the report.
Increased demand has made it harder for low-income families to find child care. Enrolment has decreased 31 per cent among families receiving a separate child-care subsidy compared with 2019, according to the report.
In general, the provinces are not putting policies in place that ensure low-income families are able to get child care in the $10-a-day program, says Martha Friendly, executive director of the Child Care Resource and Research Unit, a Toronto-based think tank.
“That would have to do with things like getting on wait lists, how childcare is located,” she says.
The province should collect and analyze waiting list data to understand where demand is highest, then develop strategies to allocate spaces to address inequities, the report says.
The child-care deal has been “transformative” for families across Ontario, said Carolyn Ferns, policy co-ordinator of the Ontario Coalition for Better Child Care.
“It’s making real change. It’s important that we support it,” she said.
If Ontario does not reach an agreement to extend the program with the federal government, the progress that has been made so far may be lost, she said.
“The clock’s ticking for Ontario.”