Ontario's Liberal government has put millions of dollars toward helping licensed child-care centres and developmental services cope with a minimum wage increase, and the premier said help for other such publicly funded sectors may be on the way.
The minimum wage rose on Jan. 1 to $14 an hour from $11.60 and the government is giving licensed child cares $12.7-million so they don't have to pass the increased costs onto parents – though some are reportedly doing that anyway.
It is also putting an extra $24.3-million into the community and developmental services sector, saying it recognizes the wage increase may affect their operating expenses.
Premier Kathleen Wynne said Wednesday she is looking across government at other sectors that receive public funding to see if more needs to be done.
"There is a difference between a private business and businesses or organizations that are supported through government funding," she said. "There's just a fundamental difference there. So, $12.7-million to make sure that municipalities can flow support to licensed child care, that was a decision that was made because we knew that there would be an impact. We're looking across government at other transfer partners to see whether there's more that needs to be done."
The government has different tools at its disposal to intervene when it comes to providing aid to public sector agencies as opposed to private businesses, Wynne's office said Wednesday.
Meanwhile, Wynne has spoken out about small businesses – in particular a pair of Tim Hortons franchisees – that are dealing with the costs by reducing employee benefits, calling it "bullying."
Wynne said her government lowered the small business tax rate to 3.5 per cent from 4.5 per cent, along with providing some other supports, and noted there are thousands of businesses across the province that have figured out how to pay the new minimum wage.
Wynne said her government will continue to work with small businesses and didn't rule out offering further aid. But she added that many business owners are already paying more than the increased minimum wage.
"I think we need to recognize that," she said. "I understand it will be an on-going conversation, but there are many businesses that are already there."
Julie Kwiecinski, the Canadian Federation of Independent Business's director of provincial affairs for Ontario, said the funding is a tacit admission that the minimum wage increase is having a detrimental impact.
"By admitting you were wrong and trying to find Band-Aids for agencies, will you admit at the same time that small businesses need more help, too?" Kwiecinski said. "Perhaps (the government) should do an economic analysis to see the extent of the problem of affordability of their plan with small businesses."
The CFIB has called on the province to conduct an economic analysis of the minimum wage policy, but is also asking it to consider mitigation measures to help small businesses cope.
Kwiecinski said the government remains in "denial" that the policy is a problem for small business because of the looming provincial election this spring.
"This is purely politics," she said. "There is no other way to put it. ... Small business is the villain. We'll likely be the villain going into the next election."