Canadian Commentary

A National Child Care Stategy

June 2003

When the Liberal party came to power in Canada in 1993, one of their primary campaign promises was the implementation of a national child care strategy. Despite some discussion over the last ten years, however, no such strategy was ever proposed, let alone implemented, and the whole idea has largely dropped off the government's agenda. Instead, the government has implemented other child-oriented policies, such as the Child Tax Benefit, which are not specifically associated with child care.

One of the primary reasons a national child care strategy was never implemented is that the provision of child care is generally seen as a provincial responsibility. Thus, any role for the federal government would be seen as yet more interference in provincial jurisdiction. Furthermore, even in the unlikely event the provinces agreed to a federal role, the provinces have very different ideas about how child care should be provided, and are unlikely to ever agree on a "national" system.

There are also more fundamental issues. A national child care strategy is generally conceived in terms of subsidizing spaces in child care centres so that they are affordable to a broader range of parents, and to ensure that the quality of care is high. However, although a majority of parents work, there is still a significant minority of parents who choose to stay at home beyond their parental leave in order to take care of their children. Although these parents (mostly women) are making a financial sacrifice to care for their children by not working, they are left out of benefiting from subsidized child care. What is more, because their working partner continues to pay taxes, they are in effect subsidizing the child care spaces of other parent who choose to work. Given that stay-at-home parents already tend to be lower down on the economic ladder, subsidizing child care spaces on a national scale could end up being regressive in terms of income redistribution.

Yet this does not mean that a national child-care strategy is not necessary. On the contrary, Canada's current economic structure makes a national child-care strategy vital. Fewer and fewer young people entering the work force have access to the kind of well-paying, reasonably secure jobs that were available to previous post-war generations. As a result, combined with changes in our culture, young people are waiting longer and longer to get married, while even after marriage, they often have to wait a considerable amount of time before they have the income and job security to have children.

At the same time, more evidence has been emerging that women really do have a "biological clock", that a fair number of women will not be able to have children after their mid-30s. Yet economically, they often cannot afford to have children before then. We are therefore placing women in a terrible catch-22 situation.

As well, although we prefer not to admit it, there can still be a career penalty for women who choose to have children once their career has reached a point where they can afford it. If you talk to small business owners informally, many will admit they are reluctant to hire a woman for a key position in a small office who may take several months off and be difficult to replace effectively. For a woman who is well established on a professional career path, meanwhile, several months off can put her at a disadvantage compared her male or childless colleagues.

In many ways, it would make more sense for women who want to have children to have them earlier in their career, if they are fortunate enough to find the right partner. Yet at the moment, such a choice is often simply unaffordable.

A national child care strategy can address this problem. In order to do so, however, the federal government needs to shift its approach. Rather than working with the provinces on childcare spaces, the federal government must work directly with Canadian parents to enable them to make their own child care choices.

In other words, the Canadian government needs to give money, a child care credit, directly to the parents of every child. It would give a larger credit for children aged 0-6 who had to be cared for full-time, and a smaller credit for children in school from ages 6-12, ending when the children are old enough to take care of themselves. For working parents, the credit would go to subsidize child care; for stay-at-home parents, the credit would compensate them for lost income from not working.

This credit would be universal, paid in installments over the course of the year starting with a child's birth. It would be taxed as income, but there would be no other clawback. Even a middle-class family is making considerable sacrifices by raising a child, and that contribution to our society should be recognized.

This child care credit should be substantial. The goal should be $4000 a year per child 0-6, and $1000 a year per child 6-12, although the government would have to work up to these levels gradually. Even these levels do not match the full cost of child care or of raising a child, but they would make a significant difference to parents. The subsidy should be the same for every child, as well, since child care costs the same for every child.

Such a child care credit would address many problems:

Such a program would be very expensive, running over 10 billion dollars a year at full cost, but this cost would be pure income redistribution - a redistribution that was entirely justified, since it would be a payment to those Canadians who are bringing up the next generation, on the part of those who will benefit from that new generation's efforts.

With a national child care credit, Canada would be able to implement a national child care policy that allows provinces and parents to make their own choices about child care, yet also helps release couples from their economic straightjacket, enabling them to have children at a time of their choice. Such a national child care credit would demonstrate our appreciation of parents, and our investment in our children.

June 2003

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