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HALLELUJAH!  ONTARIO FINALLY HAS A NEW FUNDING FORMULA

Hallelujah!  As of August 14th, 2024, there finally is a funding formula to provide some revenue-certainty for child care providers in Ontario. Not a moment too soon, in fact, a year or two too late. As of January 2025, this formula for the provision of operational funding to providers will be implemented to replace the inequitable revenue-replacement model that has existed since April 2022. As the new funding guidelines admit “[w]hile a revenue replacement approach is transparent and simple to implement, it is not responsive to the true cost of providing child care in Ontario.” (p. 7).  Revenue replacement was …

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Affordable Child Care Services vs Money for Parents

Those who oppose the $10 a day program often argue that there is a simple and better program to replace it – give money directly to parents instead.  The logic is, at first glance, persuasive.  If you give parents money, it seems like they should be able to purchase exactly the child care they need.  And competition among different providers should, you might think, keep fees down.  Programs that directly fund child care services, like the $10 a day program, are said to be bureaucratic and inflexible and to create huge shortages and long waiting lists.  There is some truth …

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Ontario Is Violating the Early Learning and Child Care Agreement

Most child care in Ontario is provided by non-profit or public operators.  This has been true for years.  A full 70% of the licensed/regulated child care spaces for children 0-5 were non-profit or public back in 2022, when Ontario signed the Canada-Wide Agreement with Ottawa.  So, two things are not in doubt.  First, it is obviously possible for non-profit and public child care services in Ontario to grow and expand, given the right conditions.  They have done it successfully in the past, more successfully than the for-profit child care operators.  Second, the Ontario government, with the support of municipal governments …

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Who’s To Blame For Child Care Shortages In Ontario?

Todd Smith is Ontario’s new Minister of Education and he has already decided who he wants to blame for Ontario’s child care shortages – it’s the federal government.  So, Todd Smith wants federal minister Jenna Sudds to release Ontario from the agreement it signed back in 2022 that limits expansion by for-profit enterprises to a maximum of 30% of the total expansion.  Ontario never wanted to limit for-profit expansion;  apparently they only signed the agreement under duress. The problem of child care shortages is a real one.  We need a lot more child care expansion in Ontario and we need …

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New Support for the Economic Benefits of Universal Child Care

I met Sebastien Montpetit at the Canadian Economics Association meetings in Winnipeg last year.  He is a Canadian and Quebecer who has been studying for his PhD in economics at the University of Toulouse.  And he, with co-authors, has come up with a really fascinating analysis of the impacts of Quebec’s universal child care program ushered in the late 1990s and the early 2000s.  The paper is complex, has multiple parts, and the latest version of it is available here.  It has been selected as one of three finalists for the Canadian Labour Economics Forum prize at the upcoming Canadian …

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Supply-Side or Demand-Side – A Contribution to the Australian Discussion

John Cherry, from Goodstart Early Learning, has written an evaluation of child care in Quebec and New South Wales.  Apparently his purpose is to determine whether supply-side funded systems (like Quebec’s) are better or worse than demand-side funded systems (like in Australia).  To summarize briefly, John finds that Quebec does better on workforce participation and affordability, NSW does better on child care accessibility and quality.  So, John concludes that Australia’s system is pretty good.  His conclusion appears to be that Australia shouldn’t flirt with Quebec’s fixed-fee, supply-side-funded system.  It’s a problematic paper for several reasons.  First, some of the details …

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The Fraser Institute’s Evaluation of the $10 a Day Child Care Reforms

This is not his best work.  Phillip Cross has had a notable career at Statistics Canada.  He’s an expert in macroeconomic trends.  But, one thing that he knows very little about is child care.    Unfortunately, he has written a short paper for the Fraser Institute evaluating the success or failure of the Canada-Wide Early Learning and Child Care reforms so far.  It’s bad. Almost everything in the paper is either wrong or misleading. So what does Phillip Cross say? (1) providing more jobs in the child care industry, (2) enabling mothers to join the labour force, and (3) providing better …

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Some Thoughts About Australian Child Care Policy

The Labor federal (i.e., Commonwealth) government of Australia has declared its intention to move towards universal child care. There is a lot of interest in the Quebec model. The Commonwealth government asked the Productivity Commission to investigate and to provide a roadmap towards universal early childhood education and care throughout Australia. The post below is my submission in response to the draft report of the Productivity Commission which you can find here. As you can see, my advice and comments are strongly informed by Canada and Quebec’s experiences. Response to the Productivity Commission Draft Report Main Messages There are some …

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The story coming from the CSELCC survey – I don’t think we’re going to make it…not even close!

We know that child care affordability is improving dramatically because of the $10-a-day program (otherwise known as CWELCC or the Canada-Wide Early Learning and Child Care Program).  But what about access and availability?  It’s difficult to know.  There is some activity, and lots of announcements, but are there actually more children using licensed child care?  A really important question, because most of the social and economic benefits of the $10-a-day program come from improving access to children and families that haven’t used child care before. Finally we have some solid answers.  Statistics Canada just completed a massive survey of parents …

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Turnover and Labour Supply in the Early Care and Education Sector

If we raise wages in the licensed child care sector in Canada, will it make much difference?  How much difference would it make?  There’s not much research around that can help us answer these questions.  And yet, they are really important to policy makers, to advocates and to parents who are trying to find scarce child care spots. Now, some really capable economists in the U.S. have published a paper (Cunha and Lee, 2023) in the National Bureau of Economic Research Working Paper series that can help us.  There’s a lot in this paper, but our focus is more narrow.  …

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