Canada?s childcare choices

July 31, 2012

Free Market Foundation

Canada’s politicians disagree on one of the nation’s major issues: how best to support families with children, says the Fraser Institute. The liberals favour a universal day care programme, while the conservatives favour a programme that supports parents.

The liberals’ programme would cost $5 billion for a national system of early learning and childcare, and an additional $6 billion for new child care spaces. However, this approach would not satisfy the needs of Canadian families. For example:

When asked to rank their preferred child care arrangement on a scale of one to five, on average, Canadians picked formal day care centres last, and said they would rather have their children cared for by a partner, a parent or other relative.

A similar child care programme introduced by Quebec crowded out private and informal childcare alternatives, because the programme only cost five dollars per day.

The neediest children make up less than 20 per cent of total enrolment, and furthermore, they tend to go to lower quality day cares than children from upper income families.

By contrast, the conservatives’ $10 billion programme would give an annual $1,200 cash allowance to parents, regardless of which means they choose to care for their children.

However, taxpayers must ultimately finance this multi-billion dollar entitlement programme. A more sensible and less bureaucratic solution would be to simply cut marginal tax rates, leaving working Canadians better off.

Source: Sylvia LeRoy, Child Care Choices, Fraser Institute, February 2006.

For text: http://www.fraserinstitute.ca/admin/books/chapterfiles/Feb06ffLeroy.pdf#

For more on International: http://www.ncpa.org/pi/internat/intdex1.html

FMF Policy Bulletin/ 18 April 2006