Breaking down the Ontario Budget

Ontario Budget Day on April 11th left more questions than answers when it came to child care. The OCBCC has been following up with the Ministry of Education and we’d like to share several updates.

Wage Enhancement

The Ontario budget documents contained no information about the Provincial Wage Enhancement Grant and government officials in the budget lock-up could not provide any information on the future of the grant, worth $2 per hour to over 39,000 ECEs and child care workers. As you know, the OCBCC’s members and allies had been campaigning to save the grant since December - with 13,000 signature petitions, dozens of MPP meetings, and hundreds of calls and emails.

On April 12th, OCBCC Policy Coordinator Carolyn Ferns wrote an urgent letter to the Ministry of Education asking for immediate confirmation of child care funding and the provincial wage enhancement grant. The Ministry confirmed to us by phone on the afternoon of April 12th that the wage enhancement funding would be continuing and promised that official confirmation and more details would be coming soon. We shared this news with our members immediately. It was later confirmed by the Toronto Star.

On Thursday April 18th the Ministry of Education posted a press release officially confirming $207 million in funding for the Provincial Wage Enhancement Grant for 2019-20.

Licensed child care funding

The 2019 Ontario budget documents contained no breakdown of the licensed child care budget. The total figure of $1.7 Billion is mentioned on page xii of the budget's preface, but it is unclear what is included in this figure. Since budget day, we have been following up to try to see a full breakdown of child care allocations.

What we know so far:

  • $1.7 Billion is allocated to licensed child care. This is roughly the same as last year’s allocation.
  • This figure includes $207 Million for Provincial Wage Enhancement. (Last year’s allocation to PWEG was $203 Million.)
  • The $1.7 Billion is in addition to $390 Million that has been budgeted for the CARE Tax Credit.
  • Page 99 mentions $1 Billion over the next 5 years to create 30,000 child care spaces in schools including approximately 10,000 spaces in new schools.

Remaining questions and concerns:

  • Allocations by municipality: We are waiting to see a full breakdown of child care allocations by municipality. We have been told that this will be available in the “coming weeks.”
  • Space expansion: We are waiting for full breakdowns to see how the budget's promised of 30,000 spaces in schools fits in with previous child care expansion plans and to see how much of this expansion is funded by federal ELCC dollars. The budget also signaled a troubling change that would allow child care in schools to be operated by for-profit businesses. We will be following up to express the community’s concern about this privatization.
  • Fee subsidies: Page 277 of the budget mentions “Prioritizing child care funding for fee subsidies to help support affordable and accessible child care for families”. We will be looking to see if this means that subsidy allocations will be broken out from general allocations, of if there is a specific target set for new subsidies.

CARE Tax Credit

Budget 2019 also introduced the new Childcare And Relief from Expenses (CARE) Tax Credit. While the government is billing this tax credit as money is parents’ pockets for child care, the OCBCC and many other experts are warning Ontarians to Read the Fine Print on the CARE credit:

  • The government estimates the cost of the credit at $390 Million but economic studies project that it could cost as much as $2 Billion annually. Funding to the tax credit is already coming at the expense of heavy cuts to education, social services, legal aid and more. If the cost of the credit balloons (as experts have warned) it will create even more pressure to cut funding from services.
  • Despite the cost, an analysis by the Canadian Centre for Policy Alternatives shows that only 41 Ontario children will receive the advertised $6000, with the average rebate only $600/year. So the credit doesn’t go far to address child care affordability.
  • An almost identical tax credit lowered Quebec's child care quality by encouraging the creation of low-cost, low-quality, for-profit child care. That's just one of the reasons that Dr. Gordon Cleveland says the CARE credit is a bad idea.

 

To stay up to date, as we learn more details of this year's child care budget, become a member of the OCBCC and receive our member emails.


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