Ontario reaches child care deal with Trudeau government following months of negotiations

Ontario child-care fees will be reduced by up to 25 per cent as of April 2022 with a further 25 per cent reduction scheduled for December.

The imminent fee reductions are part of a $13.2 billion, six-year deal with the federal government to subsidize the cost of child care.

Ontario is the final province or territory to sign on to the national accord, which aims to further reduce fees to an average of $10 a day by Sept. 2025.

The deals with other provinces and territories stipulated that the money be spent over five years.

However, because Ontario’s deal was reached just days prior to the end of the fiscal year, an allowance was made for the province to defer the first year of funding into the second year of the agreement.

That means that parents with children in daycare will essentially have to wait at least three months longer for fee relief than their counterparts in other provinces, most of which reduced fees by at least 25 per cent retroactive to Jan. 1.

In Ontario the fee reduction will be retroactive to April 1, with rebates to parents expected to begin in May.

“From day one, I said our government wouldn’t sign a deal that didn’t work for Ontario parents and I am so proud of the work we have done with our federal partners to land an agreement that will lower cost for families across the province,” Premier Doug Ford said in a press release announcing the agreement. “Given how complex Ontario’s child care system is we wanted to get this right. Today, we are delivering a deal that will keep money in the pockets of hard-working families.”

Ontario ultimately ended up getting the same $10.2 billion in funding over five years that it was offered at the outset of negotiations with the federal government, a sum that Education Minister Stephen Lecce previously argued wouldn’t be sufficient to reduce fees to an average of $10 a day.

But the feds did clarify that the province will receive an additional $2.9 billion in the sixth year of the agreement.

The Trudeau government had always said that it would provide $9.2 billion in ongoing funding to keep childcare costs low after 2025 but it didn’t make specific commitments in the individual deals with other provinces and territories, as it did with Ontario.

The other unique aspect of the deal with Ontario is what the province is billing as a “mandated financial review process” after the third year, which could see funding levels adjusted if costs prove to be higher than anticipated.

In the news release, Lecce argued that “by standing firm” Ontario was able to secure “a better deal” that “includes billions in additional funding and a longer agreement.”

But it does come at the expense of a delayed rebate for parents who already have children in childcare.

As an example, Saskatchewan reduced fees by 50 per cent as of November and also plans to issue parents rebate checks retroactive to last July.

The Ontario government says that it will be working with municipalities to enroll the more than 5,000 licensed child care centers and home child care agencies in the province in the new program between now and September. It says that the rebates, retroactive to April 1, will “follow the enrollment” of the centers and agencies into the new system.

In addition to the two 25 per cent fee reductions planned for 2022, the province says that there will also be further unspecified fee reductions in September, 2024 en route to achieving the $10 a day target in 2025.

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