Monday, December 8, 2025

Mr. Matthew DesRosiers

I can take that one. Maybe just to help differentiate a couple of terms here, the operating capacity and utilization are slightly different things. A centre might have a licensed capacity, which is, under regulation, how many spaces they are actually allowed to operate as long as they stay in the terms of the regulation. Let’s say they have a room licensed for 15 toddlers—that 15 toddlers is the licensed capacity. For various reasons, as you alluded to, it may be at a very local level there isn’t sufficient demand. It may also be, though, that the operator, due to the local labour market, isn’t able to go and find sufficient staff or sufficient qualified staff. So if they’re only able to find two staff for that room, then they would only be able to operate with about 10 of those toddler kids. On top of that, not all the kids may be there all the time, so they might have vacancies due to, again, very local demand issues or maybe because kids are moving in between rooms, so they might only have eight children actually in the seats. So we can see a very big difference between operating and utilization, as well as with their licence. Through the pandemic, we saw a very significant drop in the utilization rates. Enrolment went significantly down. We have been recovering since the pandemic. The difference between the operating capacity and that utilization rate has been maintained. What’s happening is that the operators are starting to operate more rooms and they’re starting to get more staff. Part of that can be due to the workforce strategy that has been spoken about, but there are, yes, a lot of potential reasons why. We also see a really big difference in that between the age groups. The spaces for the very young kids have recovered; it’s in that kindergarten space where we see a bigger difference. That could be due to split shifts, where it’s harder to go and actually hire staff who want to work those shifts. Yes, it’s lots of reasons. We don’t have enough data to know for sure, but it is recovering, which is, I think, promising.

Official source

Ms. Holly Moran

I think one of the other things that we need to think about is that, as the price goes down, it also becomes less of a loss for a parent not to bring that kindergarten-aged child. If one parent is able to pick them up early from school, they may do that because they are not losing their space. It’s only $10; it’s not like it was, $100, pre-CWELCC. We would have to enter in and correct for some of those types of behaviours. No child care room, either, is ever fully occupied all of the time. It’s not like a school-based cohort where all of the children age up at the same time. Children, as they age and developmentally mature, often are moving between rooms, so a child care operator will necessarily keep some spaces vacant so that those children can transition in a comfortable way: two days in this room, three days in this room and switch the next week, that kind of thing, to help those children move through the programs properly. As well, those little ones are ill quite frequently. There’s a lot of communicable diseases going on. A little bit of pink eye can wipe out a room on you. There you go.

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Ms. Jess Dixon

Thank you.

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The Chair (Mr. Tom Rakocevic)

Okay. We have one minute and 30 seconds remaining. MPP Firin.

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MPP Mohamed Firin

The new financial reporting template is expected to give a clearer picture of how costs actually work on the ground. What benefits do you expect it will bring in terms of supporting consistent oversight and helping identify what drives costs across the regions?

Official source

Mr. Matthew DesRosiers

Yes, I’ll take that one. I think, again, as we were saying, standardizing things is going be very helpful, especially in this regard. Again, as part of that accountability framework that we’ve set up, we do have this new standardized financial report. It is going to give us a lot of information. Cost-based funding, which is the new funding approach, is still in its first year, and I think as good public servants we want to make sure that we’re continuing to monitor, through that collection of good data, both the financial and the operating data. We want to make sure that we can continue to look at the parameters of that program and make sure that they are still appropriate. So, in the cost-based funding program, we have benchmark allocations, and they’re largely built up of relatively broad categories of costs. We have program staffing, supervisors, operations and accommodation all totalled into a global budget—

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The Chair (Mr. Tom Rakocevic)

Oh, sorry. We’re out of time. We now move on to the third party. MPP Fairclough, you have the floor: 20 minutes.

Official source

Ms. Lee Fairclough

Thank you all for being here. Deputy Cole, it’s good to see you, and I can sense the care for this program that all of you have, actually, in your responses. I’ve got a few different topics that I hope to cover, but I am going to start with the cost and the program funding overall. In the most recent announcement about the extension of the federal funding, the government indicated that additional funding was provided to the province in order to maintain the fees at $19 per day, and this is just for one year. You’ve talked about the urgency around this. I guess my first question is, has the province abandoned the goal of $10-a-day daycare, or is that what we’re still working towards?

Official source

Ms. Denise Allyson Cole

I think it’s fair to say that it’s an aspirational goal, but we’ve been very clear to the federal government that if we are going to meet that goal, they need to come to the table with more money.

Official source

Ms. Lee Fairclough

Okay. I guess, if that’s the case—you know, I look at the provincial contribution in figure 10: The federal government is contributing 58% of the $4.99 billion. If I’m doing my math correctly, the province is contributing to 2.6%, and then there’s the shortfall, which presumably is going to land with parents. Has there been, at any time in this, where the province has considered contributing a little bit more to make this more manageable for families? Maybe I’ll start with that question, and then I have a follow-up.

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Ms. Holly Moran

Sure. I’m happy to take that. On the broader funding arrangement and where the shortfall comes from, maybe I can back up just a little bit. I think all of the members are aware that we didn’t sign this first agreement until almost the very end of the first year. So, what that did for the province was take that full year of revenue and push it into the next four years. Effectively, the government was able to make the agreement work, because we were taking five years’ worth of revenue and spending it in four, which increases the annual spending power that you have. The second thing that the government did was amortize our space creation. I’m imagining that you’re going to have some questions later about 41,000 out of 86,000 spaces coming on board. The sooner those spaces come on board, the longer have to pay for them. So that funding shortfall was such that we had to amortize those spaces, so the majority of the spaces come on in the last year of the agreement, because that gives you the shortest period of time to spend on them. Those are the two ways that we made the current funding work. When you renew that agreement, it’s a fiscal cliff for both agreements. We both knew, walking in, that there was going to be a $2-billion-per-year gap to achieve the goals of the agreement—just sustain, no more growth, no more wage increases for our ECEs, nothing else new, just to sustain. So, when we get there, the other thing I want to talk about in terms of the spending in the space: As Whitney mentioned at the front end, there are currently three federal agreements in this space. There’s the ELCC agreement, there’s the CWELCC and there’s an infrastructure agreement. In addition, there’s a significant amount of provincial spending that operates outside of those three programs. So, when you think about early learning and child care at the global or even pan-Canadian level, it’s about that zero-to-six space before publicly funded school becomes mandatory for families, and that early learning and what everything does. Our province is one of only three that spends for full, two-year, publicly funded kindergarten for every family who needs it. When you think about that, if those children also required full-day care under CWELCC, as they do in some other provinces, the gap would be significantly larger. So there’s a massive provincial contribution there in that space. The other thing that Ontario does is we prioritize schools first as a setting for child care programs. We continue to build purpose-built child care into every new school in the province, which is a big investment for us. We’ve also harmonized our licensing regulations so that those classrooms that the children are in from 9 a.m. until 3 p.m. can be used for the before- and after-school programs as well. All of those physical site requirements are the same.

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Ms. Lee Fairclough

I understand the argument, which is that you’re saying there is a certain amount of this that is funded for junior and senior kindergarten and, currently, you’re not using any other federal transfer money for early learning to offset any of those costs. Is that right?

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Ms. Holly Moran

Exactly, yes.

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Ms. Lee Fairclough

Okay. And then, in other provinces where they have been able to make the $10 a day work, can you just talk to me about what you know about why they’ve been able to achieve that and why we have not been able to? Have you exchanged ideas with them on that?

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Ms. Holly Moran

I think that was one of the points in the Auditor General’s report, to continue to work with the federal government to understand what leads Ontario to be one of the highest-cost provinces and what other provinces have done to be able to make that work. That’s an area where we have continued to participate at the federal-provincial-territorial tables to try to understand what is behind it. It’s not an area where the federal government has shared a lot of information, and PTs tend to be a little bit hesitant about that as well. Whitney, I don’t know if you have anything to add in that area.

Official source

Ms. Lee Fairclough

I think it’s okay, if that’s okay. I guess my next question, then, is in those other jurisdictions, if they don’t have junior and senior kindergarten, are they using this program to cover the year that those kids would be in junior kindergarten?

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Ms. Holly Moran

Yes. If they don’t have full-day kindergarten, this is the program that they would have access to.

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Ms. Lee Fairclough

Okay. That’s interesting, actually. That kind of leads to some other questions.

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Mr. Matthew DesRosiers

I might just add something as well. While we don’t necessarily know the cost details of the private businesses outside of our own jurisdiction in the other provinces and territories, we can see from, say, Statistics Canada data that, prior to CWELCC, fees in Ontario were by far the highest. They were about 30% to 40% above the national average, so we had a lot more distance to go in terms of getting down to the federal targets. That’s going to be true for some of the other provinces and territories that haven’t reached $10 a day. They were already higher. So the ones that were closer to $10 to begin with can use that money for other things that we just don’t have the capacity to do here.

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Ms. Holly Moran

I think the last piece that I would just add is, the federal approach to funding doesn’t take into account cost of living in the province. Ontario receives the same dollar per child as Newfoundland, Prince Edward Island and other provinces get, and it disregards that differential in the costs, differential in leases, differential in wages, differential in cost of food—all of those things.

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Ms. Lee Fairclough

Do they do that because of scale? Recognizing you’ve got smaller populations in lots of areas in Newfoundland, that’s going to cost more as well per kid. So does it kind of balance out when you’ve got the super-high density that exists in Toronto that gives you some level of efficiency to open those daycares?

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Ms. Holly Moran

I don’t know that it actually creates any efficiency. I think it’s a long-standing federal policy across social programs that they demographically allocate the funding. They do a base allocation which would advantage those where costs are more efficient, and then it’s a per capita allocation on top of that.

Official source

Mr. Matthew DesRosiers

I might just say on top of that too that that makes sense if you’re not also setting a target at the end of the day. So if the goal is just to make things cheaper, then there could be an argument that it’s fair to do it this way, but if you’re trying to say, “But here’s the target that everyone has to hit,” then you start to have to take into account where we are starting from, and the feds didn’t do that for this agreement.

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Ms. Lee Fairclough

Okay. But you couldn’t comment on—proportionately, relative to other provinces, do you think we as a province are contributing our fair share in a similar way to this program? As we said, the total program is $4.99 billion. In other provinces, my sense is that they are taking on more of a share, recognizing the kindergarten part. But just overall, do you feel Ontario is contributing a similar amount to the goals that we’re trying to achieve in this program than other jurisdictions would be?

Official source

Ms. Holly Moran

My comment would be that Ontario is contributing more when you’re looking at the zero to six space. Over the same time period as the current CWELCC agreement—so 2021-22 to 2025-26—Ontario is investing about $28.5 billion in high-quality early learning and child care. This includes $18.4 billion in full-day kindergarten for four-year-olds and five-year-olds and $10.1 billion in provincial early years and child care investments. That includes the Ontario Child Care Tax Credit, which puts more money in the pockets of families, allowing them to claim up to 75% of their eligible child care expenses, including services provided by child care centres, homes and camps. So that total investment of $28.5 billion over that same period of time significantly exceeds the federal investment in this case.

Official source

Ms. Lee Fairclough

The majority of that is junior/senior kindergarten, and presumably every province has kindergarten—one year of kindergarten. I think that’s what you just said. Anyway, I won’t get into the details of the numbers, but I feel like we’re putting a lot of weight on the kindergarten investment versus these early year investments and what the provincial government is actually contributing to the earlier years.

Official source

Ms. Holly Moran

So full-day kindergarten is an early years investment.

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Ms. Lee Fairclough

Full day, yes.

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The Chair (Mr. Tom Rakocevic)

Under 10 minutes.

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Ms. Lee Fairclough

Okay. Thank you. I’ll move on. My next question will go to the—actually, I’d like to maybe talk a little bit about the new spaces, how we’re allocating where those new spaces go and the steps that we’re actually taking to make sure that the access rate in higher-need areas is still met. It’s my understanding there was a change in policy to make sure that we tried to hit the targets, but we didn’t necessarily consider some of the equity needs as well. Could you just maybe clarify that for us?

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Ms. Holly Moran

Sure, absolutely. When the agreement was signed in 2022, we did take a look at what the access rates looked like, and I mentioned in response to an earlier question that we were dealing with quite variant access rates, from as low as 16% in Oxford county to a high of 51%, 52% in York region. What we did was, we looked at the historic patterns of growth: What does it look like in that area of the province, that region? How quickly have they been able to grow in the past? We looked at socio-economic factors—like how many single-parent families there are, what the francophone population was, what the Indigenous population was, how many low-income caseloads were in that particular region—and we made adjustments to boost for those vulnerabilities within that area. So access was a primary; the secondary was a boost around the vulnerabilities. We left those targets—

Official source

Ms. Lee Fairclough

But that’s been sustained; that hasn’t changed.

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Ms. Holly Moran

The vulnerabilities have been sustained—

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Ms. Lee Fairclough

If we go back to the francophone access etc., none of that has changed?

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Ms. Holly Moran

Absolutely. It’s all still in place.

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Ms. Lee Fairclough

Okay.

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Ms. Holly Moran

At the point in time last—when did we do recalibration? In May?

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Mr. Matthew DesRosiers

It got updated at the end of 2024, and then we did recalibration in March.

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Ms. Holly Moran

We recast the targets in March with about a year left to go in the agreement because, at that point in time, we didn’t have an interest in leaving any federal money for new spaces on the table. We wanted to make sure that we were capitalizing on capacity to grow. So if you were in a lower-access community and you failed to hit your stretch target, then those spaces were reallocated. We did ask every municipality, every service system manager, “What have you committed? What is available? What is actually real?” at that point, and we gave them those spaces. Where there hadn’t been commitments related to space creation against those targets, those were redistributed. It was a fairly small redistribution in the province, with most receiving what they had asked for. I would say there’s still an access problem in the province. We don’t have sufficient demand. If you look at the Quebec system, which has been in place for 30 years, demand has levelled out at about 59% for the access rate. Provincially, we’re much lower than that. Even in York region, where they have the best access, 50%, it’s below 60%. There is still an access problem that is being met through these spaces. I think it was our own Financial Accountability Officer who identified we would have had to have 200,000 more spaces in order to reach the demands of the province.

Official source

Ms. Whitney Wilson

Maybe I can add on top of that: Before and after recalibration, all of those spaces were still subject to the directed growth plans. So even though the spaces maybe had some additional census data on the front end to make sure that they were targeted to low-access-rate areas, both before and after, they still had to be aligned with those directed growth plans that were targeting those vulnerable populations.

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Ms. Lee Fairclough

Okay. And just to really confirm: It’s still a principle of the ministry that you’re ensuring new spaces are added in the areas of highest need? Need is a major factor?

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Ms. Holly Moran

Yes.

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Ms. Lee Fairclough

Yes? Okay. Thank you. So, then, the next thing is really about the vacant spaces. There were some numbers that were included in the report around the 43% that remain vacant, if I’ve got that right. Let me just bring it up—yes. So 43% of all centres are operating below their licensed capacity of 80%, and 80,500 spaces weren’t utilized. My big question on that is really—I mean, you commented earlier that we used the funds. We only had four years to use the funding we got, and then we used it up a year faster, and then we still had a number—like, 27% of spaces—that weren’t utilized in that time. So I’m still trying to understand how we used up the money so quickly, and how we used it up early when we still had so much not being utilized.

Official source

Mr. Matthew DesRosiers

So again, I think, on the utilization: Part of it is vacancies; part of it is just that the kids aren’t there.

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Ms. Lee Fairclough

We still pay? There is still money given even if those spaces aren’t filled?

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Mr. Matthew DesRosiers

Yes. If you think about the fact—under a cost-based approach, which is how we now fund, if I have to go back to my toddler room and I have 15 licensed spaces, if two kids don’t show up, I still have to pay for the staff person to cover the other three kids out of their five. I still have to pay for the rent. I still have to pay for the heat to be on, and the food and all of those things. To stop that, I have to then say to that staff person, “Go home,” and now three other kids have to go home and they can’t receive the care. So we’re still covering the costs that are associated with providing care, but if the space is vacant, the operator is still incurring those costs.

Official source

Ms. Lee Fairclough

But if we then go back to this whole question of—we know demand is way more than what we have access for. I mean, I hear this in my constituency office all the time, actually. It’s a very, very common issue in Etobicoke–Lakeshore. I’m still puzzled how we can’t fill those spaces. Maybe somebody can just talk to that.

Official source

Mr. Matthew DesRosiers

Go ahead, if you want to jump in.

Official source

Ms. Denise Allyson Cole

Actually, I’ll come to you in a minute. Part of it is the workforce challenge. That is really driving some of the vacancies that we’re seeing across the province. The workers just are not there in the numbers that we need. Ontario is the only jurisdiction that has the college, so registered early childhood educators. So that’s one of the biggest drivers we’re seeing.

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Ms. Holly Moran

I think you might also remember an article a year or two ago around the YMCA in the GTA who had closed an infant room. This really underlines for me what the issue was with the workforce at the time. An infant room has a staffing ratio of three to one, so one adult for every three infants in the room. If you have a staffing shortage and you can serve 15 toddlers with two staff or—I can’t remember the ratio for preschool, but 26 kindergarten with two staff. They closed that infant room to free up the staff that they had available to serve more children in other rooms. So that can also be part of what was happening as we see those workforce numbers increasing.

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The Chair (Mr. Tom Rakocevic)

Two minutes remaining.

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Mr. Matthew DesRosiers

The other thing I just want to say, and that I think we sometimes forget: System-wide demand far outpaces supply, but it’s not a monolith system delivered by one; it’s thousands of businesses in 6,000 sites. In very hyper-local places, these markets, you might not have the demand. A very rural, remote area might not get the same demand, especially for a specific age group. So yes, it is true that, overall, the demand is very high; it is possible that specific centres just don’t have the demand for the spaces that they’re licensed for.

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Ms. Lee Fairclough

But you did say you’re allocating based on need, right?

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Ms. Holly Moran

Yes.

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Ms. Lee Fairclough

Which presumably would match what you know about that, right?

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Mr. Matthew DesRosiers

Right.

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Ms. Holly Moran

There are two things in terms of—if you back the clock up, when we first signed the agreement, what we did was, we wanted stability. So, of those centres that were there based on market trends in the past, all of them were invited to enrol in the system—

Official source

Ms. Lee Fairclough

Right.

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Ms. Holly Moran

—and 92% of them said yes. So wherever they were and whoever they were serving, they were enrolled in the system. The growth spaces have been allocated based on that more government-driven need for program vulnerability and access rates in the area. So these municipalities will target those needs—

Official source

Ms. Lee Fairclough

Those areas.

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Ms. Holly Moran

—that have been underserved.

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Ms. Lee Fairclough

What do you think is the best incentive in this whole program to make sure those spots are filled?

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Mr. Matthew DesRosiers

Yes. There’s probably a couple of things—

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Ms. Lee Fairclough

Because they get paid either way, right, from what I’m hearing?

Official source

Mr. Matthew DesRosiers

Yes.

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Ms. Lee Fairclough

That’s what I thought—

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Mr. Matthew DesRosiers

We may have to come back to this and spend a lot more time on it—

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Ms. Lee Fairclough

Yes.

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Mr. Matthew DesRosiers

There are a couple. There is the additional workforce strategy to try and get these spaces operating in the first place. There’s also a number of things on the growth side. Under the cost-based funding approach, there are growth top-ups that understand that the costs are different in each of the different SSMs and are there to act as a multiplier to create a better incentive for—

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The Chair (Mr. Tom Rakocevic)

Okay, thank you. We’re out of time.

Official source

Mr. Matthew DesRosiers

—places to expand.

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Ms. Lee Fairclough

We can come back in the next round. Thank you for that.

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The Chair (Mr. Tom Rakocevic)

Okay. We now move to the official opposition. MPP Armstrong, you have 20 minutes.

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Ms. Teresa J. Armstrong

Thank you very much. Earlier today, a very wise woman said that what gets measured gets managed, and that was the Auditor General who said that. The reason I think that I’m having a lot of questions about this program is because a lot of things weren’t measured, to your own admission, right? My first question is—and I want to thank you, by the way, for the work that you do because I’m sure it’s not an easy file to navigate. So, thank you for what you do and what you have done so far. The report reveals that child care enrolment for lower-income families receiving the subsidies has decreased by 31% compared to 2019, and I just want to ask what the government is doing to address the reasons for this decline and to ensure subsidized families are not being left behind. Can you share what families are reporting with regard to the challenges to accessing the subsidized spaces due to the increased demand for child care?

Official source

Mr. Matthew DesRosiers

I’ll jump in on this one a bit. I think this is one of those areas where gathering additional data is one of the things that we really do need to do. I think there’s been a little bit of confusion on this topic, in the press at least. There are many reasons why the pure enrolment number of fee subsidy recipients might have increased, some of which are good. It is an income-tested program where the thresholds haven’t changed and so it’s possible just that people’s incomes are going up and they no longer qualify for the program or qualify for less. Another part of it is that, as prices have come down, thanks to CWELCC, that income-tested parental contribution that determines eligibility will have become tighter as well. That means less families by the parameters of the program now need a fee subsidy. That’s true even though the parental contribution was cut by 50% as well through CWELCC to try and make it easier, so that people on fee subsidy also received the benefit of the CWELCC agreement. Given prices have come down—I think as the deputy said earlier—it could also be that the incentive to apply isn’t as strong anymore, right? Because the fees themselves, without going through all the paperwork—in some ways, invasive, and you have to go and show what your income is—you can just go and pay the lower fee. That’s also a good reason. Also, as prices have come down for children aged zero to five, it could be that some SSMs have turned around and said, “Well, now, let’s go and support, with more subsidies, the kids who are six to 12 who also need support on their fees.” I think the last reason that I can think of, and which was I believe mentioned in the Auditor General’s report, is that as demand has increased, it might just be more difficult in general for people to get access, and that’s why we’re seeing much longer wait-lists in some areas. So lots of potential reasons, and we don’t have sufficient data at this point to give a solid answer to that question. Part of that is because we don’t deliver the fee subsidies—the SSMs do—we don’t have that relationship with the families.

Official source

Ms. Holly Moran

That might be an area to explore a lot more. In particular, we have heard that wait-lists are burgeoning across the province. We have not heard from our service system managers who manage the fee subsidy program that the wait-list for fee subsidies is burgeoning across the province. Durham region, which I was speaking to last week, for example, has shared that they have eliminated their wait-list, so it’s—

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Ms. Teresa J. Armstrong

For subsidies?

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Ms. Holly Moran

For subsidies. It’s an interesting phenomenon to explore as we get into it, but as Matt mentioned, there are obviously lots of reasons that have changed the characteristic of that fee subsidy caseload.

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Ms. Teresa J. Armstrong

Yes. That’s a very interesting topic that needs to be delved into more thoroughly, and making sure for people who need access, who want that subsidy, it’s available, etc. My next question is, how many child care spaces has the government created—and I want to ask about profit versus non-profit, and does the ministry track if those new spaces being created are used for vulnerable and underserved populations?

Official source

Mr. Matthew DesRosiers

As of June 2025, which is the latest data we have available, as the deputy said earlier, we’ve created 41,000 net new spaces towards that target. We do track whether they are in for-profit or not-for-profit. I just don’t have the number in front of me at the moment.

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Ms. Teresa J. Armstrong

Is it possible to ask for that information? May I ask for that information following up—

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Ms. Holly Moran

Whitney is doing that.

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Ms. Whitney Wilson

I’m pulling it up.

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Ms. Teresa J. Armstrong

It can be sent later. You don’t have to do it now.

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Mr. Matthew DesRosiers

We do look at that. I think one of the things to remember: We had a baseline of spaces, which was in March 2019. The COVID-19 pandemic obviously had a very significant impact on the sector. The number of centres went down temporarily and has been recovering since the deal was signed. When open enrolment came around in 2022, we did have that 8% of the sector saying, “We don’t want to be a part of this program.” That represented about 23,000 or 24,000 spaces. That meant that our 86,000-space target just goes up by that amount, so those will have to be covered as well as part of the growth. We have been making progress. It was a little bit behind what we had originally planned, but that’s because we had originally planned for everyone to be in the program. We didn’t anticipate 8% not being involved. We do see this recovery, I think, through the recalibration exercise that Holly was mentioning. We have really focused on trying to have spaces grow where there are proponents ready to go, where the SSMs have commitments made or were very close to making commitments, so that we can really maximize the likelihood that we hit that 86,000 target.

Official source

Ms. Teresa J. Armstrong

I just want to clarify: The information I was asking for is how many new spots or spaces were created that are for-profit versus non-profit, and then, of those, which ones were allocated for subsidy as well, if that’s something that you can provide.

Official source

Ms. Whitney Wilson

I can speak to that. As of our most recent preliminary data, it’s 74% not-for-profit of the full system and 26% for-profit. We don’t track, within that, who is eligible for fee subsidies. As Matt mentioned, the program is delivered through service system managers. That is something that, through the new digital tool, we will be able to track more closely, but we don’t track it currently.

Official source

Ms. Teresa J. Armstrong

The next question I had was the government’s limitations on creating not-for-profit child care spaces—how does the ministry ensure that new spaces are added in those areas of the highest need? Do you try to help non-profit operators build new spaces? And I say that because there is something in the Auditor General’s report about how Ontario has one of the highest costs of child care, and we’re trying to figure out what those differentiation variables are. When we look at a for-profit structure compared to a non-profit structure, sometimes there is—maybe the cost of the CEO or the person running the facility, or a bonus at the end of the year. That’s where my question comes from. Do you hear about the limitations that not-for-profits have, and what do you have to encourage them to build more of those spaces?

Official source

Ms. Holly Moran

I would start off by saying that Ontario, as we all look at what costs the system more, has one of the highest proportions of not-for-profit child care in the country. We only behind Northwest Territories, Nunavut and Saskatchewan. Just about every other province has a ratio closer to 50-50, and Ontario has been at 70-30 for a trend that’s extended past 10 years back. So that’s one of the things that we already have. In our agreement, we agreed to maintain that proportion of 70-30, and other provinces are now more restricted in their for-profit growth than we are.

Official source

Ms. Whitney Wilson

Maybe I’ll speak to also support for infrastructure for not-for-profit. One of the agreements that we mentioned earlier was the ELCC infrastructure agreement. The initial agreement that was announced about a year and a half ago was $135 million. That targets not-for-profit community-based spaces. Those spaces are for space creation, which means that they’re also aligned with the directed growth approach. Signing the extension most recently also enabled us to sign another year of infrastructure funding, which is another $66.8 million. Those supports go directly to not-for-profit organizations to help them create space, which in some ways was a challenge for not-for-profits who maybe didn’t have the same relationships with their bank or access to loans and will help enable some of that space creation.

Official source

Ms. Holly Moran

And Matt can also speak to the limitations on the funding.

Official source

Mr. Matthew DesRosiers

The other thing I was going to add, too, was just, again, through the new cost-based funding approach: If we think back to prior to this, for 2022 to 2024, we had a sector where fees had been frozen, which meant that everyone’s profit margin or surplus margin—whether you’re for-profit or not-for-profit—was also frozen. That put a huge proportion of the sector into a loss position.

Official source

The Chair (Mr. Tom Rakocevic)

Under 10 minutes remaining.

Official source

Mr. Matthew DesRosiers

That’s one of the reasons why we wanted to move to this cost-based approach—which, also, we can get into this more if we want to, but—that provides the same sort of margin in lieu of profit and surplus to not-for-profit versus for-profit. So, it gives the not-for-profit sector a lot more certainty about how much funding they’re going to be getting, and that they will be getting a return that they can reinvest in child care as well.

Official source

Ms. Teresa J. Armstrong

Thank you. In last year’s budget, the government estimated they would spend about $222 million in capital spending on child care. Does that figure ring a bell?

Official source

Ms. Holly Moran

I think that’s capital for the school-based program.

Official source

Ms. Teresa J. Armstrong

The school-aged? Okay, and—

Official source

Ms. Holly Moran

School-based, purpose-built child care program. Sorry. I’m the wrong ADM for that one.

Official source

Ms. Teresa J. Armstrong

Okay. And I have a figure of what was spent. Out of that $222 million, $187 million was actually spent. So the government, during their vital years of CWELCC, on the rollout for 2022 and 2023, they didn’t spend 80% of its capital allocation. That’s what I’ve got, in so far as numbers. In 2023 and 2024, the government estimated the $222 million, but you actually spent $109 million over three years. That left $156 million unspent on child care capital. I just wondered why that capital wasn’t spent, and if that capital was spent, how many more spaces could that money have created?

Official source

Ms. Denise Allyson Cole

Our ADM of capital is not here today, so is that a question we can get back to you on?

Official source