Ottawa should leave daycare policy to the provinces

Goals imposed by Ottawa rob provinces of the flexibility to adjust policy. And the feds could add conditions over time, using funds as leverage

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By Charles Lammam,
Hugh MacIntyre
and Ben Eisen
The Fraser Institute

A recent federal announcement to work on a national framework for early learning and child care marks a worrisome evolution in policy in Canada.

Daycare policy has been the domain of the provinces but the government of Prime Minister Justin Trudeau wants to get involved – likely to the detriment of good policy.

Ottawa will pull the purse strings with a new $7.5-billion transfer to the provinces over 11 years for daycare. The transfer comes with new requirements (except in Quebec) and opens the door to federal interference in provincial policy-making related to daycare.

Charles Lammam

The Constitution assigns separate roles for the federal and provincial governments. For example, Ottawa handles foreign and defence policy while provincial governments provide health care and education programs. In reality, however, the federal government creates rules that limit the policy options or distorts decision-making by the provinces.

For example, Ottawa has established stringent rules (through the Canada Health Act) on how provinces run their health-care programs. These rules forbid many types of policy experimentation and are largely responsible for policy inertia, underperformance and inefficiency (including long wait times). Failure to abide by these rules results in a reduction in the transfer of federal funds.

In other areas of provincial policy-making, however, the federal government has taken a more hands-off approach – generally with better results. Consider kindergarten-to-Grade-12 education policy, where federal influence and funding is limited to aboriginal education. There’s no federal ministry of education in Canada and therefore no cabinet position dedicated to education.

daycare in canada
Hugh MacIntyre

The lack of federal rules and oversight allows provinces to innovate and experiment with education funding and delivery models that suit their residents. That partly explains why several Canadian provinces (B.C., for example) have high-performing education systems by international standards.

Contrast the Canadian education approach to that in the United States. Prior to 1979, there was very little federal involvement in education. President Jimmy Carter then created a federal cabinet post for education and started spending federal dollars to achieve his objectives and monitor performance from Washington. Since then, public spending on education has soared while student performance has declined.

That takes us back to the federal government’s daycare funding announcement. It looks like Canada may be turning away from the successful decentralized approach in education towards a centralized system characterized by tight rules and oversight from Ottawa.

The new federal funding for provincial daycare programs requires that provinces demonstrate progress toward goals, including a requisite number of daycare spaces, daycare workers, and programs designed to serve particular populations such as minorities and refugees.

Ben Eisen

Of course, governments should set measurable goals. But goals imposed by Ottawa rob provincial governments of the flexibility to unilaterally change targets or adjust policy approaches.

More broadly, there’s a risk of mission creep, where the federal government could add conditions over time. The provinces will likely find it more difficult to prevent further interference in provincial daycare policy as they become dependent on federal funds.

Experience in health-care policy and elsewhere has taught us that federal interference in provincial matters generally leads to worse outcomes.

The federal government would do well to stay out of provincial areas such as daycare policy.

Charles Lammam, Hugh MacIntyre and Ben Eisen are analysts with the Fraser Institute (www.fraserinstitute.org).


The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.

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