Millions more given for daycare in N.B. — and immediately eaten up by minimum wage increase

A $20.8-million funding announcement for child care in New Brunswick is welcome news to many in the industry — until they do the math. 

Erin Schryer, who operates 500 spaces in her two centres in Quispamsis, said operators have been waiting for Tuesday's announcement for a long time because "designated" centres like hers can't raise fees without government approval. 

"Child-care fees have not been increased since 2017, which has been a point of contention among us operators," said Schryer. 

She said operators have been asking government for an increase for a long time, so Tuesday's announced hike of eight per cent — effective April 1 — is a relief. 

But after some quick calculations, Schryer said that increase will barely cover the $1 per hour increase to the minimum wage that takes effect on April 1, which represents an increase of 7.3 per cent. 

"I know all small businesses are going to feel the pinch of minimum wage increasing a dollar on April 1, but in our sector, we don't have control over our revenue. The government has capped our fees," said Schryer. 

On Tuesday, the provincial government announced that it was partnering with the federal government to the tune of $20.8 million "to improve the quality and accessibility of early learning and child-care services."

The money is directed at the province's "designated" spaces for infants and children before they get to kindergarten, which mean the facilities have applied for and been approved by government in exchange for meeting certain criteria and following the rules and fees set by government. 

Designated spaces represent the vast majority of spaces in the province. The Department of Education and Early Childhood Development was asked on Wednesday afternoon how many total spaces there are in the province, but officials were unable to provide the answer by publication time. 

 "These investments will help our operators maintain the viability of their businesses, provide good wages for our educators, and maintain and improve quality learning for our children — all at no extra cost to families of preschool-aged children who attend designated facilities," Education and Early Childhood Development Minister Bill Hogan said in the news release.

Operating grants going up

Schryer said the increase in operating grants for infant spaces is particularly needed, since there are higher costs associated with caring for infants. There is also currently a higher demand for infant spaces. 

The daily fee will increase from $10 to $15 per infant, while grants for older preschool children will increase to $3 per day. 

"Operators receive funding from the government to offset the low-fee policy for families," according to Tuesday's news release. "Out-of-pocket fees paid by families, which were reduced by an average of 50 per cent in June 2022, will not be affected by this increase."

Hogan said the increase in the minimum wage will help with recruitment and retention of early childhood educators. 

According to the release, the turnover in the sector dropped last year to nearly 27 per cent, which was down from 50 per cent in 2021. The government said it "aims to aims to create 3,400 designated preschool early learning and child-care spaces by 2026."

Since September 2021, there has been "a net increase of 843 designated spaces in the province, bringing the total number of designated and non-designated preschool spaces to 16,999 as of March 1. This represents a six per cent increase," the government said.

A  five-year federal-provincial funding agreement signed between New Brunswick and Ottawa in December 2021 is worth $544 million — $491 million from the federal government and $53 million from the province.