With deadline looming, why hasn’t Ontario signed a child-care deal yet?

Posted on March 7, 2022 in Child & Family Delivery System

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TheStar.com – News/Canada
March 7, 2022.   By Brendan Kennedy, Social Justice Reporter

With the end of the fiscal year looming — which could mean losing this year’s funds — and parents in other provinces already seeing reduced fees, the clock is ticking for Ford’s government.

It has been more than a month since Premier Doug Ford said Ontario was “very, very close” to reaching a deal with the federal government on a new child-care agreement that promises to cut parent fees in half by the end of this year and bring $10-a-day daycare to the province by 2026.
But earlier this week, Karina Gould, the federal minister in charge of the file, said she was still waiting for Ontario to submit an action plan for how it will spend its share of the federal funding — $10.2 billion over five years — and that meaningful negotiations can’t truly begin until that happens.

Meanwhile, every other province and territory has signed on, and parents in five provinces are already reaping the benefits of dramatic fee reductions.

Ford told reporters this week that a deal will “get done as sure as we’re standing here,” but he’s “not going to do a deal just for making a deal.”

With the end of the fiscal year looming, time is running out for Ontario, which will lose the federal money allocated for 2021-22 — more than $1 billion — if a deal isn’t reached by March 31.

The Star spoke to several experts to better understand why Ontario’s negotiations are taking so long and what’s at the heart of the impasse.

What’s holding up negotiations?

Ontario wants more money than the federal government is offering and a greater, per-capita share than has already been agreed to by every other province and territory.

Ford’s government hasn’t specified how much more they want, but they have said Ontario should be credited for the $3.5 billion it spends on full-day kindergarten for children under five, something that is only currently offered in Nova Scotia and the Northwest Territories (although some other provinces are phasing it in).

The federal funding, which was passed in last year’s budget, requires separate agreements with each province and territory, accounting for regional differences. But the overall framework and the funding formula are the same. Each jurisdiction’s allotment is based on their under-12 population.

The federal plan allows operational subsidies to go to all types of licensed child-care providers to reduce parent fees and increase wages, but restricts funding for new spaces to non-profits. (For-profit businesses currently make up about 25 per cent of all child-care spaces in Ontario.)

Ontario’s education minister, Stephen Lecce, who is leading negotiations for the province, has also said he is seeking a more “flexible” deal that gives parents more choice in the type of child-care options available to them, including for-profit and unlicensed home daycares.

“Ontario is expressing a profoundly different vision of child care than the federal government and all the other provinces and territories,” said Susan Prentice, a sociology professor at the University of Manitoba and a member of the federal government’s expert panel on early learning and child care.

Lecce has also argued that the federal government’s plan will not actually get fees down to $10 a day, and he and Ford have said they want more freedom in how they spend the federal money, as well as some guarantee the funding will continue beyond the five-year agreement.

Lecce declined an interview for this story and his office did not respond to specific questions, including why it hasn’t yet submitted an action plan.

In a statement, Lecce said he’s working with the federal government “to get a better deal for Ontario families,” adding that the Ford government wants a deal that is “fiscally sustainable, actually gets prices down to $10 a day, ensures women can get back into the labour market, and helps support our economic recovery.”

Do Ontario’s arguments make sense?

Generally speaking, no, at least not according to most of the experts interviewed by the Star.

Not only is Ontario not the only province that provides full-day kindergarten to four-year-olds, they said, other provinces spend more on early learning and child care in different ways.

“There are all sorts of things that other provinces have done which cost them more money,” said Martha Friendly, executive director and founder of the Childcare Resource and Research Unit. “Ontario is not the only province that has spent more money on something that is special or unique.”

Morna Ballantyne, executive director of Child Care Now, said Ontario’s funding of full-day junior kindergarten is irrelevant.

“The idea is to use this federal money to build on what already exists,” she said. “If Ontario wants to argue that the federal government should pay a share of public education, then they should make that proposal.”

But Armine Yalnizyan, an economist, Atkinson Fellow and freelance columnist for the Star, wrote in January that Ford’s government is right to push for more money because Ontario’s high costs mean $10.2 billion won’t be enough to both reduce fees and expand access.

“Most of the federal money would simply go toward lowering the highest parent fees in the country, with little left to add new capacity,” she wrote.

The strength of their arguments aside, Ballantyne and others said Ontario doesn’t have much negotiating leverage at this point.

“Being the last jurisdiction to sign on, they’re in a very weak position to argue that the terms of the agreement that all other jurisdictions have accepted should be changed,” Ballantyne said.

It’s as if Ontario is asking for a bigger slice of pie when only one slice is left on the plate, said Friendly.

“Everybody agreed that the pie will be divided up in a certain way and then you’re the last person to get your piece of pie and you say, ‘No, I want a bigger share.’ ”

Andrea Hannen, the executive director of the Association of Daycare Operators of Ontario, which primarily represents for-profit providers but also includes non-profit members, said it’s important for the province to get a deal that “works for all Ontario families” and includes “all elements of the licensed child-care system,” including those who run commercial daycares.

They’re going to need “all hands on deck,” she said, to meet the expected demand. “We’re going to need every licensed space that we have, we’re going to need every licensed operator that we have, and we’re going to need to attract new owner-operators to the system.”

But Prentice said the federal government is correct to focus funding for new spaces on non-profits because the evidence points to better outcomes there. “At every level we see better and more efficient results in non-profit systems,” she said.

Carolyn Ferns, public policy co-ordinator for the Ontario Coalition for Better Child Care, said expanding the for-profit sector would not be a responsible use of public money.

“We really need every dollar of this to go toward reducing fees for families and improving wages for educators,” she said.

There is support for Lecce’s contention that the federal government has not set aside enough money to actually reduce fees to the extent promised.

Last month, Parliamentary Budget Officer Yves Giroux said the $27.2 billion the Liberals have budgeted for the Canada-wide program would not be enough to meet expected demand. Giroux estimated the shortfall to be about $1 billion.

What if a deal isn’t reached by March 31?

All the experts agreed it is unlikely Ford will allow the March 31 deadline to pass without a deal, especially in an election year.

A senior Ontario government official recently told the Star’s Robert Benzie that an agreement will be reached well before the June 2 election.

Gould, the federal minister, said this past week she remains optimistic a deal will be done.

“But we’re running against the clock,” she said, reiterating the need for Ontario to submit its action plan.

Bhutila Karpoche, the Parkdale-High Park MPP and NDP critic on child-care issues, said in an interview that the Ford government’s “stalling” has put more than a billion dollars at risk, and it should have negotiated a deal much earlier.

While parents in other provinces are already seeing fees drop, Karpoche said, the opposite is happening in Ontario. “We’re not providing the relief for families that they desperately need.”

Ballantyne and others also laid the blame for the impasse with Ford’s government.

“If there was a major flaw in the federal government’s approach then we wouldn’t have 12 of 13 jurisdictions having signed on, especially provincial governments of all political stripes,” she said.

Given the looming March 31 deadline, pressure is building on both sides, and Ballantyne suggested they could potentially focus on finding common ground on a one-year agreement to salvage this year’s money, kicking the most contentious issues down the road.

“They may run out of time to be able to work out every detail by March 31,” she said. “But they probably could get far enough along to have a good agreement that would produce really good outcomes for families and for those who work in the sector.”

Brendan Kennedy is a Toronto-based social justice reporter for the Star.



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