The Carney government has pledged to protect and expand the subsidized child-care program that was one of the signature achievements of the Trudeau government.
“We’ll protect the programs that save families thousands of dollars a year, including … $10-a-day daycare,” Prime Minister Mark Carney said on May 2, days after the Liberals won a fourth election mandate.
But some provinces may have other plans.
Alberta, Saskatchewan and Ontario have not yet renewed their child-care funding agreements with Ottawa — all of which are set to expire in March 2026.
Meanwhile, Alberta has raised parental fees and made other funding changes in an effort to make its program more sustainable.
“The current Canada-Alberta child care agreements are underfunded, unfair to the majority of child care providers in Alberta and fail to provide adequate support to the parents who need it most,” Matt Jones, Alberta’s former minister of jobs, economy and trade told Canadian Affairs in a May 17 statement.
‘Unsustainable and inflexible’
The Trudeau government first launched the Canada-Wide Early Learning Child-Care program in 2021. The program is administered by the provinces and territories, which have each signed separate funding agreements with Ottawa. It is projected to cost Ottawa $30 billion in its first five years.
Shortly before the federal election, Ottawa renewed its funding agreements with seven provinces and three territories, promising to collectively send them $36.8 billion over the next five years.
Ontario has not yet renewed its agreement with Ottawa. Saskatchewan has been consulting with child-care operators. And Alberta has so far refused to sign a renewal agreement, citing inadequate funding.
The province estimates Ottawa’s proposed funding terms would leave it facing a $5-billion shortfall over the 2026 to 2031 funding period.
“[This leaves] Alberta to prop up an unsustainable and inflexible system that cannot meet the demands of our growing population,” Jones said in his emailed statement.
If Ottawa does not increase its funding, Alberta plans to stop participating in the subsidized child-care program after its agreement expires in March 2026.
‘Struggling again’
To make its program more sustainable for the current funding period, Alberta also abruptly introduced program changes this spring.
In April, it required subsidized child-care operators to charge parents a flat fee of $15 a day per child — a hike from the $10 a day some parents were paying before.
Many low-income families cannot afford a sudden hike in their child-care costs, says Jim Yake, who co-owns five child-care centres and is also founder of Bright Futures Developments, a child-care development company.
“For the less affluent crowd, you can tell instantly, because a lot of them were struggling again,” said Yake.
“They’re like, ‘Oh my god, I’m going from $200 a month to $326 a month per child.’ And say you had maybe two or three children in daycare, you’re … up to $1,100 out of pocket a month.”
Krystal Churcher, chair of the advocacy group Association of Alberta Childcare Entrepreneurs, says she knows of low-income families who are weighing whether to quit their jobs. If they keep working, they will have to put most of their salary towards child care.
“I know some of our members who are in rural areas … have seen a lot of families leave daycare,” said Churcher. “They can’t afford the $15-a-day. … They weren’t prepared for it.”
The change has also been challenging for some child-care operators, who have had to explain the program changes to families, says Churcher.
“Operators … have … barely any information … and yet we have to represent [Alberta’s position] to all of the families that we serve,” she said.
‘Bombshell’
Some child-care operators have also been burned by Alberta’s sudden program changes.
On May 15, Alberta announced that new or waitlisted for-profit child-care operators would not be eligible to receive subsidies.
The news came as a “bombshell” for operators, says Yake.
Tiny Hoppers is one such operator. The Calgary-based child-care franchise is set to open a new facility in August. The owners learned in May they would not qualify for any child-care subsidies to cover any of the children at their centre.
Sam Sandhu, who partnered with five colleagues to open the centre, says parents will now need to pay the full cost of child care, which ranges between $1,400 and $1,700 a month across the industry. Without subsidies, they are unsure whether they will be able to fill the centre’s 159 spaces.
“Some people just said, ‘This fee is ridiculous … Please remove me off your [wait]list’,” said Sandhu.
“We’ve invested over a million dollars in this — we can’t just write that off,” said Sandhu. “We’ve all got day jobs because it’s very hard to support a loss of this magnitude.”
‘Income-tested approach’
When it first announced the subsidized child-care program in 2021, Ottawa pledged to bring parents’ fees down to $10 a day.
But many industry experts have long said it is not feasible to offer high-quality and accessible child care at $10 a day given promised funding levels.
Alberta has the same message for Ottawa. It has called on Ottawa to increase federal funding, remove funding eligibility and space creation targets, and apply “a fully income-tested approach to parent fees,” Jones said in the statement.
For Yake, a key concern is that the current subsidized program seems to predominantly benefit affluent families — while children of low-income families are in the minority.
“You have … [people] making $300,000, $400,000 a year take home, getting the same subsidies as people who are making $40,000, $50,000 a year take home, which is completely insane and ludicrous,” said Yake.
“Tonnes of rich people taking advantage — huge advantage of this program — and leaving a lot of less affluent … people in the lurch.”
This piece is missing some vital information, along with the jump from $10 to $15 per day, Alberta also dropped all grants available to lower income families. Many families, those who need the most help, went from under $100/month per child at certain facilities to $326/month per child. How much money is the Alberta government saving by doing this? What are the y yearly costs for Alberta to offer $10/day? And how much of that cost would be paid by the federal government and how much would be covered by the provincial government? What about the numerous studies showing that offering subsidized childcare brings in a net positive to the economy and more than offsets the costs a government puts into it?
Good article, but it needs some rounding out.
As a taxpayer, I fail to see why I should be subsidizing child care “entrepreneurs” and private child care “development companies” to run their businesses and line their pockets.
Don’t forget what happened in Australia a generation ago when an entrepreneur used generous government subsidies to buy up that country’s small private child care centres to become a billionaire. Eddy Groves and his ABC Learning company successfully lobbied the Australian government to lower standards (so he could make more money). He even lobbied against more generous maternity leave so parents would be forced to return to work (and use his services) as soon as possible. I don’t think this is what parents want in Canada.
ABC eventually went bankrupt and left taxpayers on the hook to spend even more money to keep child care services open for families.
Child care should be a public, not-for-profit service available for all children, just like public education. Ideally it should be free to families with children. Asking parents to pay $10 a day is a way to help build the system. Subsidies should be available to low-income families who can’t afford that low fee.
Entrepreneurs and child care development companies can build private child care centres with their own money for wealthy parents who want a “private school” experience for their children.
Part of the big announcement by the Feds in March that the funding had been renewed until March 2031 by 11 of the prov and territories https://www.canada.ca/en/employment-social-development/news/2025/03/toward-10-a-day-an-early-learning-and-child-care-backgrounder0.html . It included Ontario. There were press conferences here with the provincial goverment. Please clarify. It seems like a major error in the article.