Initiated in 1997, Quebec’s early childhood services are politically popular. They reimburse both users and the larger society, not only in expected improvement in school readiness, but also with unpredicted bonuses such as higher birth rates and reduced poverty levels.
Economist Pierre Fortin’s10 analysis of Quebec’s children’s system does not deal with these extras, or with the personal medium- or long-term benefits to the child attendees of children’s centres. Rather, he focuses on changes in the mothers’ labour force behaviour, setting out to answer three questions:
Publicly funded child care is not a requirement for women to work; most make do without it. Women’s tenacity in piecing together underground arrangements takes the pressure off the state to find formal solutions. For some mothers, however, the absence of reliable, affordable child care is an impenetrable barrier. They stay out of the labour force altogether, delay returning to work until their children start school or they work part-time. In 1997, Quebec women were less likely than other Canadian women to work outside the home; today, they are the most likely. Fortin and his colleagues wanted to identify the gap between those women who would work anyway and those whose presence in the workforce could be attributed to available, affordable child care.
As of 2008, more than 60 percent of Quebec children ages 1–4 years had access to $7-a-day, state-subsidized child care. By comparison, in other provinces in 2006, only 18 percent of children in this age group were in a licensed program.11 Quebec’s program expansion has been rapid since its inception, reaching 220,000 spaces. Demand still outstrips supply, with an estimated 22,000 spaces still required.
Quebec parents like their options. A 2009 survey found that 92 percent of children’s centre users said the centre was their first preference for child care.12 In addition, 66 percent of parents with other child care arrangements said they would prefer using a children’s centre.13
A number of studies using data from the National Longitudinal Study of Children and Youth reveal the influence of Quebec’s early childhood services on mothers’ labour force activity. A 2008 analysis showed an 8 percent increase since 2000 in the employment rate for mothers with children ages 1-to-4 years.14 Meanwhile, there was a 7 percent increase in the rate for mothers of 6-to-11-yearolds. By 2010, the employment rate of mothers with preschoolers increased by 12 percent.15 The majority of new labour entrants did not have post-secondary credentials therefore their earnings would be modest. The availability and the low cost of care removed a prime barrier to their working.16
Fortin’s own analysis found that in 2008, 70,000 more Quebec women were at work and their presence could be attributed to low cost preschool. This meant a 3.8 percent boost in women’s employment, and a 1.8 percent increase in total provincial employment. Adjusting for hours of work and the productivity of the new entrants, he calculated their labour added 1.7 percent to Quebec’s GDP.
Increased family incomes generate more tax revenues and lower demand for government transfers and credits, with both the federal and Quebec governments benefitting. Parents with children in a $7-a-day children’s centre or after-school program do not qualify for Quebec’s refundable tax credit, reducing the net cost of the credit to the province. The federal government takes its share of tax paid by working mothers, while its outlay for the National Child Benefit, the Child Tax Credit and Universal Child Care Benefit c is reduced. A further savings for the federal government is found in the Child Care Expense Deduction. Quebec parents enjoying reduced fee child care do not pay enough to claim the full CCED deduction.
Fortin used the University of Sherbrooke’s taxtransfer simulator and Statistics Canada’s Survey of Labour and Income Dynamics (SLID) to estimate the tax and transfer feedback from the new labour entrants. For every public dollar spent on the early childhood program, the Quebec government collects $1.05 in increased taxes and reduced family payments, while the federal government gets 44 cents for, in Fortin’s words, “doing nothing.” Fortin expects government revenues will increase over time as mothers in the 50-plus age group (those now least likely to work) are replaced by women with a stronger work history.
Fortin’s analysis also challenges claims that Quebec’s early years investments would be better targeted to low-income families. While not discounting that better efforts could be made to facilitate the inclusion of children from disadvantaged circumstances, Quebec has a greater percentage of children from low-income homes attending preschool than any other province, including provinces where public funding is solely targeted to the poor. Moreover, he shows that restricting the access of moderate- and middle-income families to affordable care would limit their abilities to earn income, reduce their tax contributions and add to their benefit claims, removing an important source of government income for social spending.
c The NCB and CTC are income sensitive. The UCCB is a taxable benefit that pays more to two-parent, one earner families, than to single parent or two-earner families.
Next: 7. Wisely investing in early childhood
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