federal budget

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Tuesday April 20, 2021

Liberals promise $30B over 5 years to create national child-care system

After decades of broken promises and half measures on child care, Finance Minister Chrystia Freeland announced today the federal government will invest roughly $30 billion over five years to help offset the cost of early learning and child care services.

This federal investment — the single largest line item in the massive 739-page budget document tabled today — is designed to significantly reduce what parents pay for care in the coming years. The government’s stated goal is to make life more affordable and to drive economic growth by drawing more women into the workforce.

The federal government estimates the COVID-19 pandemic has driven at least 16,000 women out of the job market altogether, while the male labour force has grown by 91,000 over the same period.

Another recent analysis by RBC found that almost half a million Canadian women who lost their jobs during the pandemic still hadn’t returned to work as of January. Employment among women in Canada who earned less than $800 a week has fallen almost 30 per cent, the bank reported.

Freeland said this child care investment will help counter some of the gender disparities fuelled by the pandemic crisis.

Freeland said that, as result of the new spending, the next 18 months could see a reduction of up to 50 per cent in the average child care fees paid by parents. With child care expenses running nearly as high as rent or mortgage payments in some cities, the household savings could be significant.

But to get average fees down to that lower level, the provinces and territories would have to kick in more funding as well. The promise of additional federal money could be used as a bargaining chip to convince provinces and territories to boost their own spending in this area.

Freeland said such an affordable child care system could increase the overall size of the economy — as measured by the gross domestic product (GDP) — by some 1.2 per cent.

“It’s expensive, but it’s an investment worth making,” she said.

Of the $30 billion promised today, $27.2 billion will be used to “bring the federal government to a 50/50 share of child care costs with provincial and territorial governments,” says the budget document. 

The government’s stated goal is to drive down child-minding costs within five years to just $10 a day per child, nationwide — significantly less than what most working parents pay now in all jurisdictions outside Quebec.

The budget earmarks another $2.5 billion for the Indigenous early learning and child care system — to create new spaces, to build or renovate existing centres and to support after-school care programs on-reserve.

The budget also sets aside money to make over 400 existing child care centres nationwide more accessible for children with disabilities.(CBC)