How Canadian provinces are taking on affordable child care — and how it compares to the world

Maham Abedi / March 26, 2019

Alberta’s New Democrats have unveiled an election pledge that would expand its $25-a-day child care plan.

The province’s NDP Leader Rachel Notley said the price cap would apply no matter what a parent has been currently paying for child care, and expands a pilot program that capped daycare costs at $25 daily at 7,300 spaces in 122 locations.

“Anything that holds Alberta women back, holds Alberta back.” Notley said.

Prices across Canada

While the province has Canada’s largest gap between men and women in labour force participation, it’s not the only place in Canada where daycare costs have been a source of controversy.

Families across Canada have been pushing for governments to help lower the costs. And it’s something think-tank Canadian Centre for Policy Alternatives keeps close tabs on.

In February, the organizations reported that daycare prices across Canada have dropped — or barely inched up — in some Canadian cities in what might be early signs of the influence of federal child-care money.

However, it also noted that fees for full-time, regulated child-care spaces have risen faster than inflation in 61 per cent of cities reviewed.

The fees were highest in Toronto and the surrounding area, where fees for children under 18 months average $1,685, and $1,150 a month for older preschoolers.

Cities in Quebec had the lowest fees for full-time, regulated spaces across the country, followed by Winnipeg and Charlottetown — in the three provinces that have fixed fees for years.

David MacDonald, a senior economist with the Canadian Centre for Policy Alternatives, explained to Global News that three provinces have intervened in child care and set fees at lower costs than the market rate.

Quebec, Manitoba and P.E.I. have lowered the costs for residents by setting a maximum price, MacDonald said.

“They’re making up the difference as a transfer to providers,” he noted. “In the Canadian context, that appears to be the most effective way of reducing child-care fees for parents.”

He cited Montreal as an example, where the average daycare cost is around $200 per month.

MacDonald added that three other provinces are mulling similar moves — Alberta, Newfoundland and Labrador and British Columbia. He also noted the federal government has signed bilateral agreements to support provinces who take on lowering child care costs.

University of Manitoba professor Susan Prentice, who specializes in child care policies, explained to Global News Quebec will have cheaper child care than Alberta even if Notley’s pledge materializes.

“The leader in Canada for child care has been for over two decades, Quebec,” Prentice said. “Their child care is much more developed and much more affordable.”

How other countries compare

But Prentice said Nordic countries are “miles ahead” the rest of the world when it comes to nationally subsidized child care programs, specifically highlighting Sweden.

In Sweden, Prentice said municipalities must have a child care spot ready within three months of a request.

“The average family pays between three and five per cent of their family income, and often less,” she added.

According to a survey by Organisation for Economic Co-operation and Development based on 2016 statistics, parents in Sweden spend around four per cent of their family income on child care — among the lowest in the world.

Other countries that rank the lowest — all under five per cent — on spending include Austria, Greece and Hungary.

The average cost of child care in the international group is 15 per cent of net family income.

Canada is above the average, with residents spending an average of 22.2 per cent of their family income on child care.

The United Kingdom ranks the most expensive in the group at 33.8 per cent of family income going toward child care. The United States was at 25.6 per cent.

A recent blog on the World Economic Forum‘s website also noted that Nordic nations are the best place to have kids, financially speaking.

Beyond Sweden, it noted that child care costs in Denmark are capped 30 per cent of the actual cost, with the government covering the rest.

Finland has a universal free daycare program for children eight months and older, until they begin schooling at seven years of age.