Amid cost-of-living crisis, Nova Scotia’s government daycare failing families

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Appeared in the Halifax Chronicle Herald, April 22, 2023
Amid cost-of-living crisis, Nova Scotia’s government daycare failing families

When the Nova Scotia government inked a deal with the federal government two years ago to bring about “$10-a-day” daycare, it was described as a “game changer.” Two years in, daycare providers say waitlists are longer than ever. The government’s plan is failing. Canadians in every province should take heed.

And while the cost at some daycare centres has gone down for parents lucky enough to nab those spots, the government daycare program—which costs hundreds of millions of dollars—makes the overall cost of living higher for Nova Scotia families by expanding an already-large government paid for by higher taxes.

Fundamentally, the problem is in the design. Because Nova Scotia’s government daycare program aims to subsidize attendance in government-regulated daycares, it’s increased waitlists at these daycares while simultaneously strangling independent daycare operators who are now part of the $10-per-day program, forbidding them from opening new spaces because they are for-profit—a regulation under the new federal-provincial childcare agreement.

Again, the results speak for themselves. The government promised to add 1,500 spots by the end of 2022, but instead added just 400.

Now, some Nova Scotia parents are even losing their previously “guaranteed” daycare spots because of the rise in demand due to the government’s reduction in fees. Because of the cost reduction, some families are shifting from part-time to fulltime daycare, or leaving their kids in daycare longer, resulting in fewer overall spaces for new children. As Maritimers well know, in daycare just as in our “universal” health-care system, universal access to a waiting list does not mean universal access to care.

Sadly, these problems were entirely predictable (and indeed predicted). Quebec implemented a similar system of subsidized daycare in the late-1990s. The result? An expensive program, which didn’t shorten wait lists and didn’t deliver the promised results of increased cognitive benefits in children. The per-child taxpayer cost of government daycare in the province nearly doubled from $4,874 in 1997 to $9,823 in 2016 (inflation-adjusted). Quebec spends billions on the program every year, subsidizing many families who don’t financially need the help.

And while advocates often point to increased labour force participation among women in Quebec, since 1997 female labour-force participation rates in Atlantic Canada increased at a faster pace than in Quebec—without subsidized daycare.

There’s no reason to believe that Nova Scotia’s experience will be any different. Costs are already on the rise. The program was introduced at $645 million over five years. However, the provincial government added an additional $100 million last fall, and advocates claim this is still not enough.

Of course, childcare is a significant cost, especially for young families. But the evidence is clear that a top-down government-controlled system is not the answer. So what’s the answer? According to research, governments can reduce childcare costs by reforming regulations that make it more expensive. And a targeted approach can direct daycare toward those who need it most, at a lower cost.

Finally, compared to families in other provinces, the cost of childcare weighs heavier on Nova Scotia families because so many other costs are higher than in other parts of Canada. The prices of groceries and gas are inflated. Taxes are going up, even though middle-income earners in Nova Scotia already face higher taxes than other Canadians.

The question is: will government spending on large, new programs—that may increase wait times and reduce program quality—help lower costs for families overall? Provincial government spending is higher than ever. Does the cost of living feel lower?

Childcare comes in all shapes in sizes—a neighbour, a grandparent, or a variety of different homes or centres. The government should replace its failed daycare scheme with targeted relief for those who need it. And focus on the affordability problem it’s helped create for all Nova Scotia families.

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