The Ontario government has announced that it will implement a new funding structure for the national $10-a-day child-care program starting in 2025. This change comes after child-care centres, including the YMCA, expressed concerns about the current funding formula not covering the actual cost of providing care. The government aims to provide certainty to operators and keep child-care centres in the system to offer affordable care to families. Operators had previously frozen fees as part of the national plan, which has impacted their revenue replacement model.
Traditionally, child-care centres have raised parent fees to cover rising expenses such as staffing costs, rent, and supplies. However, under the national $10-a-day program, operators have had to freeze fees, leading to a revenue replacement model that does not reflect the current cost of care. The government has allocated over $98 million towards addressing emerging issues faced by operators, such as rent increases. The YMCA of Greater Toronto’s Chief Operating Officer hopes that the new funding formula will cover all costs to ensure the sustainability of the program in the future.
The province has been working towards a cost-based funding formula since 2022, initially aiming for implementation in 2023. After a delay, the government has now informed operators that the new approach will start in January 2025. The details of the new formula will be announced soon, with the hope of covering all legitimate costs of running a child-care centre. It is important for the funding formula to provide incentives for higher quality childcare services and be stable and reliable year after year so that operators can plan their programs and budgets accordingly.
Child-care operators have emphasized the importance of certainty and predictability in funding to keep their centres open and plan for the future. The Ontario Coalition for Better Child Care believes that a solid funding scheme for child-care programs will bring stability to the sector. The long-awaited funding reform is expected to provide operators with the support they need to continue offering high-quality child care services. The government’s commitment to implementing a new funding formula is seen as a step towards ensuring the sustainability of the $10-a-day program and creating more child-care spaces in the province.
