February 26th, 2024

Daycares sound the alarm on provincial funding model, say closures could be imminent

By COLLIN GALLANT on January 31, 2024.

Children at Kids Play Preschool enjoy circle time with their teacher in this February 2022 file photo. Child-care centre across Alberta, including those in Medicine Hat, say the new funding model set up by the provincial government to administer Ottawa's $10-day program is leaving them short operating costs for up to six weeks at a time.--NEWS FILE PHOTO


Child care centres in Medicine Hat have been raising the alarm over financial stress caused by a new funding model for at least two weeks, the News has learned.

Daycare operators across Alberta face a deadline of today to sign on to new agreement to offer the Federal-Provincial Subsidy, but say the deal leaves them carrying costs for too long and doesn’t take high inflation into account.

Letters sent to local parents and the areas MLAs, including Premier Danielle Smith, ask for support in adjusting to new payment schedule and more flexibility to recover the cost of general inflation.

“We are met with a very difficult decision,” reads a letter sent on Jan. 15. “We want nothing more than a continuation of funding for our clients and staff as well as affordable quality programming for our children … several child care programs in Alberta are considering opting out of the agreement entirely.”

The News is unaware of any local daycare closures during a co-ordinated day of protest across Alberta on Tuesday, but 14 member centres of association did close and staged a rally in front of Lethbridge city hall.

Chief among complaints are the program payment schedule doesn’t mesh with how they collect from parents, and the agreement limits increases they say are needed due to inflationary pressure, and further reductions are due in February.

The new formula adds $200 per month for 2024 in new government funding in an agreement between Ottawa and Alberta.

That reduces payments by parents, however clients would have paid that money to operators starting on Jan. 1, whereas the provincial government, which administers the program, won’t begin the additional payment until mid-February.

“With the new model, the Government of Alberta programs reduce fees in advance, by 28 per cent, and wait for repayment for five weeks,” the letter reads. “This drastically affects our budget and ability to afford wages.”

That leaves six weeks of carrying expenses for operators, and whereas new funding allows increases of up to 3 per cent for inflation, they say the actual cost increase is closer to 10 per cent.

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