Child Care in Canada: An Introduction

Jay Makarenko — Mon, 17 Sep 2007 12:29:58 -0600

Child care is a significant issue in the context of Canadian public policy and the relationship between federal, provincial, and territorial governments. This article provides an introduction to the complex nature of child care policy, including the operation of child care vis-à-vis Canadian federalism, an overview of provincial/territorial child care policies, a historical review of federal and intergovernmental child care initiatives, and a brief discussion of key issues in the politics of child care.

Canadian Federalism and Child Care

Federal and provincial roles in child care

Provincial/Territorial Child Care Polices

Approaches to child care across provincial jurisdictions

Federal Government: Child Care Policies

Overview of child care policies at federal level

Intergovernmental Agreements on Child Care

Federal-provincial/territorial relations in child care

Issues in Canadian Child Care Policy

Basic debates in the politics of child care

Sources and Links to More Information

Lists of article sources and links to more on this topic

Canadian Federalism and Child Care

Operation of child care in Canada’s federal system

In examining child care policy in Canada, one issue that must be addressed is the role of different levels of government in this policy field. This provides important context in understanding the current operation of child care programs in Canada, as well as examining why the child care debate is often framed in the manner that it is.

Provincial Jurisdiction in Child Care

Under Canada’s Constitution, the authority to legislate in the area of child care falls under provincial jurisdiction. This includes the power to implement public child care programs, to permit or prohibit private child care providers, to regulate what sorts of services child care facilities are to provide, and to dictate what sort of education and certification child care professionals must have to provide their services.

Provincial governments also have the constitutional power to provide financial benefits in the area of child care. This may include provincial tax credits (which parents may apply towards child care costs), as well as direct subsidies to child care providers to reduce the cost of child care for parents. The decision whether to subsidize child care or not, and to what extent, is completely up to the individual provincial government.

Federal Jurisdiction in Child Care

The federal government, by contrast, does not have the general constitutional authority to legislate in the area of child care. This means that it cannot pass laws or legislation pertaining to how child care programs operate or who is eligible to provide child care services. There are, however, some qualifications.

The federal government does have constitutional authority to legislate social services for particular groups in Canadian society, such as Aboriginal Peoples and members of the Armed Forces. In these cases, the federal government can unilaterally implement particular sorts of child care programs. In an Aboriginal context, for example, the federal government has implemented the Aboriginal Head Start program. It provides half-day preschool for young Aboriginal children, and focuses on elements such as school readiness, Aboriginal culture and language, and health promotion.

The federal government can also play an indirect role in child care policy through the use of its constitutional spending powers. While the Constitution disallows the federal government from directly regulating the operation of child care programs, it nevertheless permits the Government of Canada to spend federal monies in this area. The federal government can use this spending power to institute limited forms of child care initiatives. The federal government may, for example, provide financial subsidies to parents in support of child care – either in the form of direct payments or tax credits. It can also use its spending powers to influence provincial policies in child care. The federal government may, for example, commit federal funds to a province if that province institutes certain child care policies.

Fragmentation of Child Care Policy in Canada

An important characteristic of child care in Canada is the tendency towards fragmentation. Programs and initiatives differ, not only between groups, such as Aboriginal and non-Aboriginal Canadians, but also between regions, with individual provinces and territories pursuing alternative child care objectives and programs. At the national level, while there are federal and intergovernmental programs and strategies, such national initiatives tend to maintain provincial independence (and, in turn fragmentation) in child care policy rather than reducing it.

This situation can be viewed as either positive or negative, depending on one’s political orientation. For example, for those whom believe that provinces and territories should be free to pursue their own independent social policy, the fragmentation of child care policy would seem to be natural. For those whom believe that there should be a national and universal child care policies in Canada, this fragmentation could be viewed in a negative light.

Provincial/Territorial Approaches to Child Care

Approaches to child care across the provinces and territories

In Canada, child care is deemed to be an area of provincial responsibility. Accordingly, provincial governments hold different views as to what the state’s role in child care should be. There is, consequently, a great deal of variation in how child care is delivered from province to province across the country. The following section examines the similarities and differences in child care policies across the country.

Overview of Child Care Providers

In many cases, parents or extended family members provide child care. Outside of family members, the majority of child care in Canada is provided by private individuals or agencies, which offer child care services as a private business. In some cases, these are for-profit agencies, while in other cases they are not-for-profit child care providers. In each situation, however, parents are charged a fee in exchange for child care services received.

Only a small percentage of child care facilities in Canada are publicly operated, either by provincial or municipal governments. Most, instead, are owned and managed by private individuals, agencies, or businesses. Provincial/territorial governments do, however, provide a form of child care through their basic education systems – as is the case with kindergarten, which is available to children around the age of five or six. It is important to note, however, that provincial and territorial kindergarten programs are meant to prepare children for primary and secondary schooling, as opposed to being a “child care” service.

Provincial/Territorial Subsidies for Child Care

Most provinces and territories provide some form of financial subsidy in support of child care costs. The nature and extent of these subsidies, however, varies from jurisdiction to jurisdiction. Quebec offers the closest example of a publicly-funded child care system in Canada. There, the Government of Quebec initiated a network of community-based, not-for-profit child care centres; they are independently operated, but funded primarily by public monies (parents are charged a nominal daily fee to enroll their children in these child care centres). Other provinces and territories also subsidize child care facilities and services, although not to the same extent as in Quebec. In those provinces, parents are required to cover the majority of costs associated with child care.

Another form of provincial/territorial support for child care is direct subsidies to parents. These may come in the form of either direct payments to parents for child-based costs (including child care), or through provincial/territorial tax credits. In the case of the latter, parents claim the tax credits to reduce their annual tax liability, and then can use the savings to cover their child-based costs. These subsidies are usually completely discretionary, meaning that parents may use the funds in any way they wish, be it for child care or otherwise. Moreover, in some cases, these subsidies specifically target lower-income families, while in other cases they are provided universally to all parents.

For more on provincial/territorial subsidies to parents:

Canada Revenue Agency: Provincial and Territorial Programs

Provincial/Territorial Regulation of Child Care Services

Finally, all provinces have instituted some form of regulation of child care services, in particular those provided by child care professionals. This would include regulation of who is eligible to provide child care, as well as standards of child care services. Again, the precise nature and extent of these regulations differs from jurisdiction to jurisdiction.

Quebec has the most comprehensive system of child care regulation, due in large part to the highly public nature of the services it provides. The Quebec government regulates the governing structures of public child care facilities (requiring them to be community operated with the participation of parents), access to those child care facilities, the qualifications and pay of child care workers, as well as the standards of child care services. To the latter point, the Government of Quebec has adopted a broad early childhood development program which it institutes through public child care facilities.

For more information on the regulation of child care services in Quebec:

In the remainder of the country, regulation of child care services varies considerably. All provinces and territories require particular qualifications for child care workers, and certain standards of health and safety in the operation of child care facilities. Most jurisdictions also have some sort of early childhood development program, which they institute through their child care policies. However, the precise nature and extent of these programs varies significantly.

For more information on provincial/territorial regulation of child care services:

Federal Government Child Care Policies

Overview of federal child care-related programs

The federal government has instituted its own programs in the area of child-rearing and care. The following section provides an overview of these programs.

Maternity and Parental Benefits

One form of federal support for child care is maternity and parental benefits offered through the federal Employment Insurance Program (EI). These benefits are provided to birth or surrogate mothers, biological fathers, and adoptive parents, who have made payments into the EI Program for a certain period of time. Under federal EI, maternity or parental leave is considered to be a legitimate cause of absence from work, such as unemployment or sickness, and is thus eligible for payment of employment insurance benefits. Accordingly, a parent may take an absence from work in order to care for a child for certain period of time, during which they will receive monthly payments from the federal government. These payments are usually based upon the number of insured hours worked prior to the leave, and salary earned.

It is important to note that these benefits must be claimed shortly before or after the child’s birth, and are only paid for a fixed length of time (usually around one year in total). As such, EI maternity and parental benefits are only viable as a means of child care support in the very early stages of a child’s life.

For more information on federal EI maternity and parental benefits:

Government of Canada: Employment Insurance (EI)

Child-Based Tax Credits to Parents

In addition to maternity and parental benefits, the federal government also provides support for child care through child-based tax credits to parents.

The first federal child-based tax credit was the Child Tax Exemption, introduced in 1918. Under the Exemption, families with children were provided with tax credits that could be used to reduce annual federal tax obligations. These tax benefits were completely discretionary, meaning that parents could use the funds in any manner they saw fit, be it in support of child care or otherwise. This tax benefit remained in place until it was replaced in 1978 by the Child Tax Credit (see below).

In 1972, the federal government introduced the Child Care Expenses Deduction, which provided a tax deduction to families with child care expenses related to work. The Deduction was in addition to the Child Tax Exemption, and was only applied to families that were required to secure child care in order to earn a living. The Deduction was not available to families in which one parent stayed home to provide child care. Moreover, the Deduction only applied to families with older children, as opposed to those with an infant or toddler.

In 1978, the federal government replaced the Child Tax Exemption with the Child Tax Credit, a system of refundable and non-refundable tax credits. As with the previous Child Tax Exemption, the new child tax credit system was completely discretionary, meaning that parents could use the funds gained in any manner they chose, be it for child care or otherwise. The system was also structured in a manner to give preferential treatment to families with lower incomes. Those with lower household incomes received a larger tax credit than those with higher incomes. In some cases, parents whom earned a household income over a certain threshold were excluded from claiming the tax credit altogether. In 1992, the Child Tax Credit was rolled into the Child Tax Benefit, which was a payment-based system of federal child support (see below).

In 2007, the federal government re-introduced a tax credit for families with children. This tax credit is for children under the age of 18 and is based on the number of children in the family. The funds received from the tax credit are completely discretionary, meaning families may spend the funds in any way they like – be it on child care or not.

Child-based Payments to Parents

Another form of federal support in the area of child care is direct child-based payments to parents. The first of these programs was the Family Allowance Program (commonly referred to as the “Baby Bonus”), introduced in 1945. This program involved a monthly federal payment directly to families with children, with the purpose of increasing household spending power and ensuring the basic needs of children were met. Again, the Program was completely discretionary, meaning that parents could use the monthly payments however they saw fit – be it for child care or otherwise. Initially, the Program was applied universally to families with children under the age of 16, meaning that all eligible families received the same benefit regardless of their income level. Over time, the Program was extended to include families with children up to the age of 18 (where the child was attending school, or the child was disabled), and was evolved to target only those families with lower levels of income.

For more information on the Family Allowance Program:

In 1992, the federal government consolidated the Family Allowance Program and Child Tax Credit (see above) with a new Child Tax Benefit. Under the Benefit, parents received monthly federal payments based on the number of children in the family, as well as the level of household income. Those families with lower incomes received a larger benefit than those with higher incomes. Again, the Child Tax Benefit was a discretionary benefit, meaning that parents could use the funds in any manner they saw fit, be it in support of child care or otherwise. In addition to the Child Tax Benefit, the Government of Canada introduced the Working Income Supplement, which was provided to working poor families. The Supplement was intended to provide working families at low-income levels with additional resources for child-rearing costs, including child care support.

The federal government again modified its system of child-based payments to parents in 1998, with the introduction of the Canada Child Tax Benefit (which replaced the Child Tax Benefit). This new benefit system is a joint federal-provincial/territorial program, administered by the federal government. It provides monthly payments to families with children. The Canada Child Benefit also included a new National Child Benefit Supplement, oriented towards lower-income families; it replaced the previous Working Income Supplement. As was the case under previous systems, the Canada Child Tax Benefit and National Child Benefit are discretionary payments, meaning that parents may spend the funds as they see fit, be it on child care or otherwise.

For more information on the Canada Child Tax Benefit and the National Child Benefit:

Revenue Canada: Canada Child Tax Benefit (CCTB)

Finally, in 2006, the federal government implemented the Universal Child Care Benefit. This new benefit is a monthly federal payment to help families, with children under the age of six, provide child care. The Benefit operates in addition to the federal-provincial/territorial Canada Child Tax Benefit and National Child Benefit, as well as the federal Child Care Expenses Deduction (see above). Like the Canada Child Tax Benefit, the Universal Child Care Benefit is a discretionary payment; parents may use the funds for whatever purpose they wish.

For more information on the Universal Child Care Benefit:

Revenue Canada: Universal Child Care Benefit (UCCB)

Intergovernmental Agreements on Child Care

Federal-provincial/territorial relations in child care

While it is generally the case that federal, provincial, and territorial governments pursue their own programs in child care, there is some level of cooperation between levels of government. These involve federal-provincial/territorial funding arrangements for child-based benefits, as well as national agreements on child-based agendas.

CAP, CHST and Child Care

One of the key areas of federal-provincial/territorial relations in child care has been through federal funding arrangements for provincially-delivered child-based benefits and services. The first these initiatives came during World War II, with the increased need for women in the workforce. In 1942, the federal government established the Dominion-Provincial Wartime Agreement. Designed to encourage the provinces to provide care for the children of women working in essential wartime industries, this Agreement established that the federal government would pay 50 percent of the total cost associated with the provision of these services. Only two provinces, Quebec and Ontario, chose to participate in the short-lived program. The federal government subsequently withdrew its support at the end of World War II.

In 1966, the federal government again decided to wade into the field of child care, this time through the Canada Assistance Plan (CAP). Under the CAP, the federal government reimbursed the provinces for 50 percent of their eligible social service expenses, regardless of the total amount. The CAP included funds for child care, treating it as a welfare-type program.

Since its introduction, the CAP has undergone several key evolutions. In 1995, the federal government altered it by combining those fiscal transfers with federal funding for health care and education into a single ‘block’ transfer know as the Canada Health and Social Transfer (CHST). The federal government also significantly reduced its financial contributions under the CHST, requiring the provinces to cover a greater share of the cost of many social programs, including those related to child care. To compensate for these reductions in transfers under the CHST, the federal government granted the provinces greater flexibility in how they spent the funds. In the context of child care, the federal government removed the requirement for the provinces to spend money on child care programs in order to receive federal funds under the CHST.

Early Childhood Development Initiative

In 1999, Canada’s First Ministers (with the exception of Quebec Premier Lucien Bouchard) signed a framework agreement outlining a new relationship between the federal government and its provincial/territorial counterparts – a relationship which was formalized under the Social Union Framework Agreement. A cornerstone of the Social Union is the National Children’s Agenda (NCA). The NCA is a far-reaching policy document designed to establish a shared vision among the 14 governments (federal, provincial, and territorial) for enhancing the well-being of Canada’s children, as well as a common understanding of the changing circumstances and needs of children. The National Children’s Agenda also established that the provinces and territories are free to tailor agreed-upon policies and programs in a manner that best meets the needs of their respective jurisdictions.

The Early Childhood Development Initiative (ECDI) is one of the programs developed under the National Children’s Agenda. The ECDI targets four specific areas of early childhood development: promoting healthy pregnancy, birth, and infancy; improving parental care and family supports; strengthening early childhood development, learning, and care; and, strengthening community supports. In 2002, the federal government committed $2.2 billion in Early Childhood Development Initiative funding over a five-year period. This funding was delivered first through the Canada Health and Social Transfer, and then the Canada Social Transfer (after the federal government moved to split the CHST into two separate funds in 2004 – the Canada Health Transfer and the Canada Social Transfer).

A key component of the ECDI was the allocation of some funding to improve the quality of, and access to, child care across the country. The ECDI, however, did not clearly stipulate the amount of ECDI funds that the provinces and territories were to spend on child care, or the sort of child care programs that were to be pursued.

2003 Multilateral Framework on Early Learning and Child Care

In 2003, the federal, provincial, and territorial governments (with the exception of Quebec) agreed to the Multilateral Framework on Early Learning and Child Care. The primary objectives of this agreement is to promote early childhood development, and to support the participation of parents in employment or training by improving access to affordable, quality early learning and child care services.

Under the Framework, the federal government committed $1.05 billion in funding over five years. In exchange, the provinces and territories agreed to invest the federal funds in early learning and child care programs for children under the age of six. This included programs and services that provided direct care and early learning for children in settings such as child care centres, family child care homes, preschools, and nursery schools. Investments in programs and services that are part of the formal school system were not included. It is important to note that while the Government of Quebec did not agree to the Framework, it still received its federal funding share.

For more on the Multilateral Framework on Early Learning and Child Care:

Government of Canada: About the Federal/Provincial/Territorial Multilateral Framework on Early Learning and Child Care

Federal-Provincial/Territorial Bilateral Agreements on Child Care

In addition to the Early Childhood Development Initiative and the Multilateral Framework on Early Learning and Child Care, several bilateral agreements on child care were struck by the federal government and individual provinces and territories. The purposes of these bilateral agreements were to describe specific objectives and investments on early childhood learning and child care that were tailored to the particular needs and priorities of individual provinces and territories.

For more on the details of these bilateral agreements:

2006 Child Care Spaces Initiative

In 2006, the new Conservative federal government significantly altered federal-provincial/territorial relations in child care with the introduction of the Universal Child Care Plan. Under this Plan, the federal government unilaterally revoked all previous bilateral agreements (see above) between the federal government and individual provinces and territories. In their place, the federal government introduced the Child Care Spaces Initiative, which provides $250 million annually (for five years) to the provinces and territories to support the creation of child care spaces. This funding is in addition to other federal transfers to the provinces and territories under the Early Childhood Development Initiative and the Multilateral Framework on Early Learning and Child Care. In addition, the federal government introduced a tax incentive to businesses and organizations to create new child care spaces in the workplace.

Issues in Canadian Child Care Policy

Basic debates in the politics of child care

The issue of child care is a highly contested one in Canada. The following section provides an introduction to a few basic issues in the politics of child care.

Nature and Significance of Child Care

A fundamental issue in the context of child care is the basic nature and significance of child care services. All would agree that adequate care for children is an important social concern; however, there is often strong disagreement regarding the nature of child care services, as well as the relative significance of child care from a public policy perspective.

Some, for example, would argue that child care is about providing physical care for children. This would simply involve providing children with a healthy and safe environment while their parents are at work or in school. Others, however, take a much broader view of child care. This view considers not only physical care, but also early childhood education and development. Child care, in this sense, involves social skills development, as well as preparing children for entrance into the formal schooling system. This, in turn, can lead to very different visions concerning child care policy, especially in regards to the sorts of qualifications that child care workers require, and the types of services child care facilities should provide.

Moreover, there is also strong disagreement on the significance of child care as a public priority. Persons with children, for example, will tend to place greater importance on child care policy than those without children. At the same time, lower-income families, who depend on out-of-the-home child care in order to earn an adequate household income, may place greater importance on child care policy than affluent families who can provide child care themselves independent of public programs. This, in turn, can lead to differences concerning how much ‘political capital’ and money governments should devote to child care.

Public versus Private Child Care

From a political standpoint, a further issue in child care policy is the role of government and whether child care should be a public or private good. Most would agree that governments have some role to play in this area, particularly in regards to the regulation of child care worker qualifications, as well as health and safety standards in child care facilities. Beyond this, however, there is often strong disagreement on the extent of government involvement in child care. Some, for example, support a highly public child care system, which is managed and funded by governments. Others may support a more private system, in which parents contract out child care services to private individuals or agencies.

One could argue that a public system is vital to the creation of equitable child care in Canada, in which all families, regardless of income, have access to quality child care services. A largely private child care system, it could be argued, results in a situation in which only affluent families with the necessary income have access to quality services. Such a situation could be considered highly unfair, especially if one holds access to quality child care to be a highly valuable good. One could argue, for example, that such access is important to a child’s overall development, as quality child care can assist a child in his/her social development and prepare s/he for formal education. Moreover, that access to quality child care is important to a family’s general welfare, as it enables parents to secure care for their children while pursuing employment or training outside the home.

There are, however, also arguments against a highly public child care system. One could argue that child care is best provided by family members, as opposed to outside-of-the-home child care facilities. As such, public monies should be used to assist families in providing their own child care, rather than promoting child care outside of the home. Moreover, one could argue that a private child care system is preferable in that it provides parents with choice in child care services. Parents can select which sort of child care services best fit their own needs and preferences from the range of private providers. Finally, one may argue that equality of access to child care services can be achieved through indirect public support, such as government payments or tax benefits for parents, as opposed to a public system in which child care facilities are operated and funded by governments.

Child Care and Intergovernmental Relations

Another issue in the area of child care is the precise role of different levels of government. For some, child care policy should be a strictly provincial issue, with little federal involvement other than funding. The idea here is that residents of individual provinces and territories should be free to adopt child care priorities and strategies that best fit their own preferences, as opposed to being forced into policies decided by the federal government in Ottawa. For others, child care policy should be a national issue – one in which the federal government plays a central role in its development and implementation. The argument here often centres on creating equitable access to quality child care across the country, and the need for the federal government, in cooperation with the provinces and territories, to take the lead in creating uniform child care programs, standards, and funding for all Canadian children – regardless of where they reside.

Sources and Links to More Information

List of article sources and links for more on this topic

Sources Used for this Article

Tougas, J. (2002). “Reforming Quebec’s Early Childhood Care and Education: The First Five Years.” Childcare Resources and Research Unit. 25 July 2007. <http://www.childcarecanada.org/pubs/op17/op17ENG.pd0f>
Lauzière, M. (2000). “The Early Childhood Development Initiative: Challenges for the Voluntary Sector.” Canadian Council on Social Development. 25 July 2007. <http://www.ccsd.ca/perception/243/ecd.htm>
“Child and Family Benefits.” Revenue Canada. 20 July 2007. 25 July 2007. <http://www.cra-arc.gc.ca/benefits/>
“The Universal Child Care Plan Provides Spaces…” Government of Canada. 05 May 2007. 25 July 2007. <http://www.universalchildcare.ca/en/spaces/intro.shtml>
“About the Federal/Provincial/Territorial Multilateral Framework on Early Learning and Child Care.” Government of Canada. 11 March 2004. 25 July 2007. <http://www.ecd-elcc.ca/en/elcc/about.shtml>
“Family Allowance.” The Canadian Encyclopedia. 25 July 2007. <http://thecanadianencyclopedia.com/index.cfm?PgNm=TCE&Params=A1ARTA0002718>
“Key Economic Events: 1944 – Family Allowance Program: Supporting Canadian Children.” Government of Canada. 25 July 2007. <http://www.canadianeconomy.gc.ca/english/economy/1944family.html>

Child Care

Child Care in Canada: An Introduction

Canadian Federalism and Child Care

Federal and provincial roles in child care

Provincial/Territorial Child Care Polices

Approaches to child care across provincial jurisdictions

Federal Government: Child Care Policies

Overview of child care policies at federal level

Intergovernmental Agreements on Child Care

Federal-provincial/territorial relations in child care

Issues in Canadian Child Care Policy

Basic debates in the politics of child care

Sources and Links to More Information

Lists of article sources and links to more on this topic

Canadian Federalism and Child Care

Provincial Jurisdiction in Child Care

Federal Jurisdiction in Child Care

Fragmentation of Child Care Policy in Canada

Provincial/Territorial Approaches to Child Care

Overview of Child Care Providers

Provincial/Territorial Subsidies for Child Care

Provincial/Territorial Regulation of Child Care Services

Federal Government Child Care Policies

Maternity and Parental Benefits

Child-Based Tax Credits to Parents

Child-based Payments to Parents

Intergovernmental Agreements on Child Care

CAP, CHST and Child Care

Early Childhood Development Initiative

2003 Multilateral Framework on Early Learning and Child Care

Federal-Provincial/Territorial Bilateral Agreements on Child Care

2006 Child Care Spaces Initiative

Issues in Canadian Child Care Policy

Nature and Significance of Child Care

Public versus Private Child Care

Child Care and Intergovernmental Relations

Sources and Links to More Information

Sources Used for this Article

Links for More Information