Canada’s Child Care Plan Faces Equity Challenges After Five Years

The implementation of Canada’s $10-a-day child care plan has significantly improved affordability for many families, but systemic inequities persist. Reports from the Auditor General of Canada and the Auditor General of Ontario indicate that while fees have decreased, the program’s commitments to inclusion, quality, and equitable access are not being met. As a result, vulnerable families continue to struggle to find affordable child care.

Initially launched as a transformative initiative, the CWELCC program aimed to provide every child in Canada with an equal opportunity for early education, regardless of their socioeconomic background. Yet, the current situation suggests that affordability is overshadowing equity, risking the entrenchment of existing disparities and perpetuating the cycle of poverty.

One major concern is the decline in government subsidies aimed at low-income families. Although these families have traditionally relied on subsidies to cover the costs of care, the number of children receiving such support has decreased sharply since the program’s inception. According to the Auditor General of Ontario, there has been a 31 percent decline in subsidy use, with Toronto reporting that fewer than 80 percent of eligible families are accessing available funds. This reduction occurs even as demand for low-cost care rises, creating fierce competition among families for limited spaces.

The CWELCC program has faced criticism for not mandating that funded programs accept subsidized children. By mid-2025, approximately 30 percent of Toronto’s CWELCC programs had no contractual obligation to serve subsidized families. Currently, more than 16,500 children in Toronto are waitlisted for care, while nearly one in three public programs deny access to subsidized children.

The financial structure of the CWELCC program further exacerbates these inequities. Fee subsidies are funded through provincial budgets, while affordability funding originates from the federal government. Consequently, when families stop using subsidies due to unavailability or restrictive eligibility rules, provinces save money while still benefiting from federal investments. This has led some regions, including Saskatchewan, Alberta, and the Northwest Territories, to eliminate subsidy programs entirely.

In a recent development, Ontario announced a one-year extension of its federal child-care agreement, maintaining current funding levels while negotiations for a longer-term deal continue. This extension keeps the daily fee at approximately $22 but fails to address the systemic inequities present in the current structure.

The CWELCC framework includes five key pillars: affordability, access, quality, inclusion, and data accountability. However, progress has largely been limited to affordability. Even with new funding, merely increasing financial resources may not resolve the underlying issues. Regional policymakers in Ontario have the authority to allocate subsidies and prioritize local needs, yet they have not effectively addressed these challenges.

There are calls for stronger regulations to ensure that all CWELCC-funded programs accept subsidized children as a condition for continued funding. Additionally, these programs should be required to meet quality standards and set targets for equitable access based on local demographics. In areas identified as child-care deserts, priority could be given to families in those neighborhoods until new facilities are established.

The rapid expansion of for-profit child care centers poses another significant challenge. Many of these centers have emerged in affluent areas, leading to a concentration of resources where they are least needed. Ontario’s Auditor General reported that nearly half of all new licensed spaces were in for-profit centers, contrary to commitments to prioritize non-profit and public expansion. This trend undermines public accountability and further deepens the inequities that the federal child-care program aims to eliminate.

The recent extension of the CWELCC program offers an opportunity for Ontario to reassess its approach. Holding the line at a $22 daily fee, rather than reducing it to the initially promised $12, could free up approximately $100 million in Toronto alone. These funds could be reinvested to enhance care quality in low-income neighborhoods, stabilize the workforce, and mitigate for-profit expansion.

Expanding subsidies alone will not resolve the structural inequalities that exist. Current eligibility requirements, which stipulate that parents must be employed or in school to qualify for subsidies, exclude many children who could benefit from early education. These barriers should be removed to ensure that all children, regardless of their parents’ work status, have access to quality care.

Moving forward, Canada should aim for a universal, income-based model, similar to the Canada Child Benefit, where all children qualify for early learning, and fees are adjusted based on family income. Such a system would simplify the existing, complex patchwork of subsidies and flat fees into a more equitable framework.

As Canada’s early learning and child-care plan evolves, equity should be the guiding principle, not an afterthought. While the nation has made strides in making child care affordable, ensuring fairness in access and quality remains a critical challenge.