‘Daycare Chaos: New Operators in Alberta Shocked to Lose Funding at the Last Minute’
Parents in Alberta who were in the midst of establishing new childcare centers have found themselves left in the lurch after the provincial government suddenly notified them that they wouldn’t be eligible for grants under the recent federal-provincial childcare pact.
“I am heartbroken,” stated Arshdeep Kaur, who is currently refurbishing a structure she bought in Calgary with intentions to launch it as a new childcare center named in July.
Sparkling Kids
.
Kaur relocated to Canada from India in 2011 and started working in early childhood education the next year. She mentioned that she had long dreamt of establishing her own daycare center and originally intended to pursue this venture when her kids were slightly more grown-up.
However, she explains that her plans shifted two years back when her 2-year-old daughter received a diagnosis of leukemia. During the course of treatment, she found herself with ample time for reflection.
Kaur stated, “That’s when I realized, no, now is the perfect moment to launch my own daycare.”
Her relatives in India sold their farmland to support her aspirations.
Following an extensive search lasting several months for a leasing opportunity for a building suited for a daycare, she came across nothing appropriate. Ultimately, she decided to buy a property outright and embarked on transforming it into a childcare center.
She mentions that she has invested hundreds of thousands of dollars into this project — with the assumption that she, similar to most childcare center operators in Alberta, would qualify for the federal-provincial funding arrangement established back in 2021.
However, last Thursday marked a turning point. On that day, she claims to have gotten an email from the provincial authorities stating that Alberta was approaching the cap on new, profit-oriented facilities eligible under the five-year pact made with Ottawa. As such, her daycare wouldn’t be entitled to receive those government subsidies.
If these funds weren’t available, the cost for parents at her daycare might be three to four times more expensive than the standard rate of $326 monthly charged at eligible childcare centers.
Kaur mentioned that during all the negotiations with government officials, which included navigating various permits and completing extensive documentation for opening the daycare, it was never hinted at or proposed to her that the required funding could potentially be unavailable upon launch.
She stated that over the past year, the government has never informed her that it would be limited or halted at any point.
I am now burdened with nearly a million dollars of personal debt.
Disappointment, shock, panic
Cheryl Montgomery was ready to launch a new daycare in the town of Nanton when she received the news that she would also be ineligible for government funding.
She stated that there was disappointment. Similarly, there was shock. And perhaps, there was also a certain degree of panic.
We have already put significant investment into this, including a committed one-year lease.
Montgomery’s facility, Little Ropers Learning, could accommodate up to 22 children. She awaited the final licensing check prior to her official launch and already possessed a roster of potential employees as well as a waitlist of parents eager to enroll their children.
However, at present, she remains uncertain about how to move forward since she lacks access to the government grants that were essential components of her business strategy.
She has
informed parents
Without those grants, they would need to cover the entire cost of $1,100 per month for each child, and she doubts whether she could find enough customers ready to pay such an amount.
Montgomery mentioned that she hadn’t received any correspondence from the province indicating her potential disqualification for funding until she was abruptly told the previous week that she didn’t qualify.
She has been communicating with other operators facing comparable circumstances and mentions that some of them are now concerned about potential bankruptcy.
“Being in this position is quite frightening,” Montgomery stated.
From an economic standpoint, each of us has dedicated substantial amounts of both time and funds. The facilities we’ve prepared are nearly set for launch as early as tomorrow; however, we’re all disheartened by the recent announcement that we aren’t eligible.
For profit vs. not-for-profit
Under the
agreement it signed
In 2021, Alberta committed approximately $4 billion in federal funding to prioritize expanding “not-for-profit” childcare services with support from the federal government.
The wording of that accord states: “Alberta pledges to generate at least 42,500 non-profit positions within the coming half-decade.”
The conditions of the deal also state that Alberta “can establish as many as 26,200 profit-oriented spots,” contributing to a overall objective of generating an additional 68,700 new spaces by the time the pact concludes in 2026.
Seven provinces along with all three territories have agreed to these new federal deals extending until 2031, whereas Ontario has come to an agreement separately.
agreement in principle
. Alberta and Saskatchewan
have not
entered into new accords with Ottawa.
By March, the province reports that around 19,500 profit-oriented spots were established through the federal-provincial initiative, along with approximately an extra 3,000 slots designated for ventures that had prior approval.
space-creation grants
.
Montgomery states that the province notified her they will no longer approve new facilities for funding unless these are located in areas with particularly high childcare demands, and this does not cover Nanton.
‘Hold on, keep your phone close’
Demetrios Nicolaides has become the newest minister overseeing childcare in Alberta, following a
cabinet shuffle last week
.
He told reporters Wednesday the province needs to ensure “adequate access to child-care spaces” in areas where there is the highest demand.
He stated, ‘We’re allocating funds to regions facing the greatest needs to assist with easing the demand.’ He further explained that this initiative is primarily motivated by the pressures on demand.
Nicolaides mentioned that being new to his position, resolving these matters will be a primary focus for him.
“I believe I have been serving as the minister of childcare for approximately three to four days now,” he stated.
I will soon start contacting numerous operators, advocacy organizations, and umbrella groups to have more detailed conversations. This way, I aim to gain a thorough understanding of their issues, challenges, and worries, enabling us to collaborate effectively in resolving these matters. In the meantime, I’d request they remain patient, stay close to their phones, as we’ll be calling them shortly and looking forward to our discussions.
Montgomery states that she has been attempting to reach someone from the Alberta government ever since learning last week that she wouldn’t be eligible for funding, but hasn’t received any response.
“I’ve called, I’ve messaged… and haven’t gotten any response,” she stated.
I have received absolutely no communication from the government so far.
‘It might break us’
In a written statement to CBC News, Nicolaides stated that he acknowledges this circumstance is “disheartening for those diligent business owners launching new initiatives without equal access to financial support compared to others within their industry.”
Alberta remains committed to securing greater flexibility within both the present accord and future ones, since service providers and parents truly merit improved conditions,” he stated. “We will persist in conducting sincere talks with the national administration to establish a sufficiently financed early learning and childcare pact devoid of restrictive limitations, ensuring fair treatment for all providers and directing assistance towards those households facing the greatest challenges.
As her Calgary daycare remains unfinished, Kaur fears she might need to sell her house to settle her debts if things do not improve soon.
She questions whether anyone would want to purchase the facility she bought, considering it has mostly been transformed into a daycare center — particularly since new operators remain ineligible for government support.
She stated that they had invested all of their resources, every single thing they possessed.
“It might break us.”