August 2020
Backgrounder
Municipal Implications

Municipalities have been crucial partners in Ontario’s COVID-19 response, including in child care.  In Ontario, the costs of child care programs are shared by the provincial and municipal governments. Municipal governments and District Social Service Administration Boards (DSSABs) play a significant role in funding, planning, managing, and in some cases, directly delivering child care programs.
 
Mandatory closures due to the COVID-19 pandemic have had a big impact on child care and early learning services. In response, the provincial government announced its Sustainability Plan on May 9, 2020 to protect much needed child care spots across the province. The plan is for municipal service system managers to provide funding to help licensed child care services and EarlyON Child and Family Centres avoid bankruptcies and permanent closures. During the emergency situation, the Province also funded emergency child care to support essential frontline workers in communities.
 
Emergency child care ended on June 26, 2020 as child care centres in the province were allowed to reopen at a reduced capacity, with fewer children and stricter health and safety protocols. The reopening funding model is intended to cover costs when operating expenses are higher and revenue from parent fees is lower.  Beginning July 27, 2020, the provincial government permitted child care centres to operate with cohorts of 15 children, an increase from the previous cap of ten. This change was made to allow more parents to return to work.  In September, the government is supporting a full return to the pre-COVID-19 capacity.  The federal government is also contributing funding that will help with the additional costs incurred during the pandemic.  A combined provincial-federal investment of $234.6 million through the Safe Restart Agreement will help child cares open and operate safely for children and their families.
 
It remains to be seen whether the operating funding will be enough to keep child care centres sustainable over the course of the reopening phases, and whether municipal costs will increase. AMO is monitoring so that it does not cause undue hardship to municipal budgets, which are already under a massive strain due to increased costs and revenue loss brought on by COVID.
 
Background

If funded adequately, child care can play a key role in Ontario’s economic recovery from COVID-19. Maintaining existing child care spots has been essential to allowing parents to return to the workplace.  Maintaining employment in the child care sector is also key to recovery, especially in northern and rural communities where child care systems can help attract and retain the skilled workforce needed to grow local economies.  Further, child care can help reduce poverty and is essential for early childhood development, leading to improved educational outcomes and a stronger labour force in the long term.  The government is also reviewing the effectiveness of the Child Care and Early Years Act, 2014. AMO will continue to provide input to ensure child care and early years programming in Ontario is prioritized during the COVID-19 recovery phase and into the future.