Childcare providers in Edmonton and Calgary are unlikely to meet federal reimbursement targets by 2022, according to projections in a new think tank report.
The federal government’s $3.8 billion deal on childcare, first announced last year, aims to halve average reimbursements by the end of 2022, before reaching the $10 per day mark by 2026.
According to a report from the Canadian Center of Policy Alternatives (CCPA) released Tuesday, the monthly median allowance for preschool-age childcare in Edmonton is projected to be $575 this year, down just $137 more than it should have been. to get to 50. percent benchmark. In Calgary, it is estimated at $700 per month, or $163 above target.
David Macdonald, co-author and senior economist at the Canadian Center for Policy Alternatives, said it’s because of Alberta’s funding structure and a lower subsidy for parents.
In November, the government announced changes to childcare subsidies based on household income, ranging from $266 per month for lowest-income families to $106 for families earning less than $180,000.
Operator grants are designed to offset reimbursement costs ranging from $450 to $635 per child in licensed facility daycare centers, depending on age.
Macdonald said that in several provinces, including Alberta, government rebates in a market-based system may not guarantee full price cuts.
“Providers can essentially find loopholes to increase their fees and lock in some of these transfers rather than going entirely to the parents,” he said, noting that it remains to be seen how effective restrictions on that will be. to be.
He said the rates will not go down because Alberta, along with other provinces such as Manitoba and Prince Edward Island, count changes in subsidies toward their 50 percent discount on rates.
“We only count changes in reimbursements if there are any,” he said.
When surveying providers and collecting reimbursement data for licensed spaces as of late 2021, researchers used provincial action plans to predict that for preschool-age childcare, only seven out of 26 Canadian cities will meet or exceed the federal target, while 15 are expected to meet the federal target. cities will come close, within $20 to $100 of the target.
The CCPA has collected comparable data every year since 2014. In larger cities such as Calgary and Edmonton, a random sample of center spaces and all family care agencies were called, including 56 centers in Edmonton and 60 centers in Calgary. Macdonald estimated a margin of error of plus or minus 10 percent, nine times out of ten. In Edmonton, 82 percent of homes and home offices were also included, along with 79 percent in Calgary.
Macdonald said that using the median, or measure of the average rate between different costs, matches the methodology the center has used each year and is relatively similar to the average give or take $5 per day.
“This will likely be the only analysis of its kind to be published in the country,” said Macdonald, noting that it’s an effort to adopt a consistent methodology across the country that is as closely aligned as possible with federal regulations. targets.
Alberta was the ninth jurisdiction to sign a childcare agreement with Ottawa as part of its $30 billion federally funded plan, which also promises to create at least 42,500 new nonprofit childcare and early learning spaces in the province.
At the end of last year, parents paid an average of about $1,000 per month for childcare in Alberta.