Canada’s child care sector struggling under weight of COVID-19
MARCH 18, 2021
VANCOUVER — Like in many Canadian cities, full-time licensed child care in BC is struggling under the financial burden of COVID-19—registering a dramatic drop in enrolment while revenue-generating parent fees remain unaffordably high, a new study by the Canadian Centre for Policy Alternatives (CCPA) shows.
Of 37 Canadian cities surveyed, some of the highest fee increases for three to five-year-olds are in BC with Surrey and Richmond both seeing eight-per-cent increases and a seven-per-cent increase in Kelowna. Five of the surveyed cities are in BC and fees increased two per cent in Burnaby while slightly decreasing in Vancouver by two per cent, the report Sounding the Alarm: COVID-19’s impact on Canada’s precarious child care sector finds.
Fees for infant and toddler child care also increased significantly in four of the five BC cities over the last year—Kelowna, 12 per cent, Richmond, eight per cent, and five per cent in both Surrey and Vancouver. There was no change in fees for infants and toddlers in Burnaby.
“The differences in how much parents pay for child care fees across Canada are staggering,” says senior economist Iglika Ivanova. “Provinces where child care is left largely to market forces have considerably higher fees than those that have taken measures to promote affordability. BC is in the middle with the government providing more funding than provinces like Ontario, but still maintains a reliance on the market.”
The study shows that fees are higher in the for-profit sector than in the not-for-profit. And other research has shown for-profit spaces are often of lower quality.
In BC’s five surveyed cities, for-profit fees for three to five-year-olds were higher than in the non-profit sector. They ranged from 60 per cent higher in Surrey to 24 to 28 per cent higher in Kelowna, Burnaby, Vancouver and Richmond. These findings are particularly concerning because 96 per cent of the new licensed spaces created in BC child care centres between 2016 and 2019 were in the for-profit sector.
There are only enough licensed spaces in BC for 20 per cent of young children and more of these spaces are in the for-profit sector (47 per cent) than in either the non-profit (42 per cent) or family child care (11 per cent) sectors.
As concerning as increasing fees are significant drops in enrolment across the country, with the notable exception of centres with set fees in Quebec. In BC, enrolment declined by 32 per cent in Richmond, 23 per cent in Surrey and 20 per cent in Burnaby.
The report found a strong correlation between declining enrolment and cities with high parent fees as well as those with high unemployment, further reinforcing the importance of public funding in child care.
“It’s clear that relying on exorbitant parent fees to fund services that should be part of the social infrastructure is what got us into this mess in the first place. Canada’s economic recovery is at risk without more and different, support,” says report co-author David Macdonald.
BC’s child care fee reduction program, introduced in 2018, does not set maximum fees but limits how much participating providers can increase fees. BC parents, however, still pay thousands of dollars more per year than parents in Quebec and a number of other provinces, including all that set fees. Fees in BC are in the middle third nationally with one exception—Richmond’s child care fees for toddlers (18 months to 3 years) are the third highest in the country ranking with cities in Greater Toronto, Ivanova explains.
Most provinces/territories do not support child care services with substantial operational funding, forcing them to rely heavily on parent fees. If fee revenues fall because of the economic impacts of COVID-19 on families, child care services are put in jeopardy.
Among the report’s findings:
- Enrolment is dropping more dramatically in cities with high parent fees. In every city outside Quebec there were at least 10 per cent fewer children in child care in fall 2020 compared to February 2020; 27 of 37 cities showed enrolment drops of 20 per cent or higher, including Burnaby 20 per cent, Surrey 23 per cent, Richmond 32 per cent.
- Child care fees are lower in cities located in provinces that provide operational funding and set parent fees. Set fees are lowest in Quebec (at $181 a month), which provides the most substantial operational funding. Quebec City, Longueuil, Montreal, Laval and Gatineau remain the most affordable cities for child care in Canada.
- Despite BC’s fee reduction program, infant/toddler fees are still five to seven times higher than what Quebec parents pay. BC fees are five to six times higher for three to five year olds.
- Toronto continues to be the least affordable city for child care in Canada, with median preschool-age fees of $1,250 a month ($1,866 a month for infants). Fees rose 15 per cent to 21 per cent between 2019 and 2020 in Brampton, Windsor and Mississauga.
- Fees are higher in the for-profit sector than in the not-for-profit sector in almost every city. In nine of 25 cities for which data were available, for-profit fees were at least 25 per cent higher, some substantially higher.
The full report is based on data from a survey involving 11,000 phone calls, representing a sample of 53 per cent of regulated full-time centre-based and regulated family child care in 37 large Canadian cities, including five in BC (Vancouver, Burnaby, Surrey, Richmond and Kelowna).
The Canadian Centre for Policy Alternatives is an independent, non-partisan think tank that researches social, economic and environmental justice issues.