Provinces should be wary of Quebec’s daycare model

Proponents of universal child care take it as an article of faith that subsidized daycare "more than pays for itself" in higher labour-market participation rates among women, and kids who are better equipped for learning when they reach school age.

Despite study after study casting doubt on these assumptions, the universal-daycare lobby has largely succeeded in depicting the absence of a government-sponsored universal daycare system in Canada (with the exception of Quebec) as a great national shame. And considering the upfront cost of child care in most big cities, it's hard for many struggling parents not to agree.

But as Ottawa prepares to lay down the conditions for provinces to access the $7.5-billion in new child-care funding promised in last month's federal budget, and as British Columbia's NDP vow to introduce a Quebec-style $10-a-day daycare system if it wins the May 9 provincial election, it's worth having an honest debate about how best to spend scarce child-care dollars.

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There is mounting evidence that the $2.4-billion-a-year Quebec model is not the way to go. Despite its popularity – which makes reforming the program politically perilous for any government – Quebec's public daycares are plagued by long waiting lists. Typically, well-off parents have learned how to game the system to snag limited spots, often to the detriment of less well-connected low-income families. Despite the $7.75-a-day that parents pay upfront, many families are no better off on an after-tax basis, especially since they are unable to maximize federal deductions.

Universal is also a misnomer when it comes to the Quebec system. Only 35 per cent of the 250,000 Quebec children attending some form of daycare in 2013 had a coveted spot in a public Centre de la petite enfance (CPE), with its highly structured activities and multicertified caregivers. Most Quebec children (38 per cent) in licensed child care still get it in a so-called family setting, often from a neighbour who runs a daycare out of her home. While some parents prefer this type of arrangement, many others fear their kids are being shortchanged by second-class care.

They likely need not worry. One rigorous but controversial 2015 study found that successive cohorts who have gone through Quebec's subsidized daycare system since 1997 have exhibited a deterioration in non-cognitive, or social, skills for years to come. "At older ages, [Quebec daycare] program exposure is associated with worsened health and life satisfaction, and increased rates of criminal activity. Increases in aggression and hyperactivity are concentrated in boys, as is the rise in the crime rates," the study concluded.

Though the study did not probe why this is the case, the highly structured, rules-based nature of CPE care might not be a good a fit for many children, especially boys. A report released last week by daycare associations in Quebec's Eastern Townships recommends allowing boys attending CPEs (and girls if they want to) to participate in roughhousing and war games. "These are natural games," the report says, and banning them only leads to a build-up of tension.

And what of the vaunted leap in female labour-market participation rates that Quebec's daycare system has purportedly produced? Doesn't the extra economic activity generated by more working women lead to higher tax revenues, ensuring that subsidized daycare "pays for itself?"

While cheap daycare surely facilitated the integration of Quebec mothers into the job market, there are other factors that contributed to the rise. A recent Fraser Institute study notes that Quebec's daycare system came into force concurrently with a tightening of federal employment-insurance eligibility rules, a reform that forced many women in Quebec and Atlantic Canada to move from seasonal or part-time work to full-time jobs.

What's more, population growth has been slower in Quebec since 1997 than in the rest of Canada, making it easier for women in the province to find jobs. Quebec also has proportionally fewer immigrants than other provinces. Immigrant mothers with young children are much less likely to work outside the home than their Canadian-born counterparts, usually out of choice. So, there are good reasons to believe that bump in female participation rates experienced in Quebec after 1997 could not be reproduced in other provinces if they adopted Quebec's daycare model.

Quebec's attempt at creating a one-size-fits-all public daycare system is hugely expensive for what it delivers. It's not a model any other province, starting from scratch, should strive to emulate. Targeting scarce daycare dollars at those most in need remains the best way to go.