Public Accounts Committee on Nov. 27th, 2025

[Karen Hogan]

We issued two recommendations, and that's probably one of the most key ones. If you want to show that Canadian funds met the objectives of this program, you should set yourself up at the front end to gather all that information, and there are some really important gaps.

The agreements call for that kind of information sharing, so now you need to sit down with the provinces and territories. There needs to be the will on both sides to have the ability to gather and then a willingness to share. In some cases, we see the federal government is not getting some information, but when they are getting information, they're not consolidating it in order to give a global portrait of what they might already have.

I think there's some work to be done on both sides, but this should be thought of at the start of the creation of a program. What do we want to measure and how do we plan on getting there? It's also about making sure you have certain milestones a few years in in order to show progress so that you can keep pushing towards the ultimate goal.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

I would go so far as to say that perhaps the disbursement of funds should be contingent on these types of things. I find it completely ironic that on the day we are supposed to hear the announcement of an MOU with my province, there's a lack of details surrounding these things. This is, in fact, one of the flagship pieces of this government, which is a continuation of Prime Minister Trudeau's.

What I'm hearing you say, which is consistent with what they have done and what I expect they will do today, is they just announce things and put things in place without really doing the hard work of determining the data, the necessity and the requirements for implementation, or, as we've seen here with ESDC, doing the follow-up for it.

Ms. Hogan, you mentioned that parents who do shift work or who live in rural remote communities are being offered limited opportunities.

Pardon me; I'll address this to Mr. Thompson.

What concrete actions have you taken to make the program more accessible and more open to parents who don't work nine to five in an urban centre?

[Paul Thompson]

This is an objective that the provinces have signed off on to make a service offering that is responsive to the needs in their own jurisdictions. Obviously, the federal government doesn't determine the allocation within a province to different centres. This is certainly a known area with our provincial colleagues, and they're endeavouring to try to make that type of service available.

It's outside of the federal government's authority to allocate specifically within a province to meet specific needs, but there's a shared objective to do so.

[The Chair, Conservative, John Williamson]

Thank you. That is your time.

Mr. Housefather, you're next, please, for five minutes.

[Anthony Housefather, Liberal, Mount Royal, QC]

Thank you, Mr. Chair.

I think the report generally shows that this program has been a pretty big success. It's created regulated day care spaces, over 112,000 up to early last year, that likely wouldn't have been created otherwise, entitling parents to find cheaper and more guaranteed, quality spaces for their kids and systems.

Ms. Hogan, do you have any reason to believe that if the federal government had not created this program, those spaces would have been created?

[Karen Hogan]

I wish I had a crystal ball and could tell you what would have happened. What I can tell you is there wasn't a clear agreement across the entire country that making spaces more affordable was needed, and federal funding has supported that. We have seen concerns around the long-term fiscal sustainability of this going on beyond 2026.

It's clear that it has supported meeting some of these objectives, but the federal government has a long way to go in being able to demonstrate that all of those objectives are being met. The act had more than just affordability in it.

[Anthony Housefather, Liberal, Mount Royal, QC]

Of course, I completely agree. As to the question of everybody just remaining...and provinces being left to do whatever they want with respect to day care, it's likely that these spaces wouldn't have been created. You're looking at an innovative program that one province did and exporting it across the country with the aid of the federal government, but leaving provinces within their jurisdictions to have flexibility with respect to how the programs are managed. They have the right to sign agreements with the federal government, or not sign if they don't want the program. I think that's an important thing.

Let me come to another question, because I think a fair point was raised.

Mr. Thompson, you know I like to ask a lot about contracts and their terms. What were the terms in, presumably, the template agreements we started with—obviously negotiating with each province with respect to reporting—and why was it difficult to have reporting initially? I assume that all of the provinces started from a different place with respect to the information they had available and the creation of systems that would allow them to know such things as whether or not they had a wait-list.

Can you talk to me about what was initially asked for by the federal government and what the negotiation process was like with respect to the different provinces on that point about data collection?

[Paul Thompson]

First of all, it was a complex undertaking to start a system from a patchwork of different programs that existed, with the starting point in each jurisdiction being quite different. As a result of that, we did our best to tailor agreements to some of the provincial circumstances, so it wasn't a carbon copy in each single province. There was a bit of customization to match circumstances, which made it a bit more complex, but it was an effort to try to recognize these different starting points.

To comment on your question to the Auditor General, I think one additional benefit on top of the federal investment is that it's been a catalyst for provinces to invest significantly as well. Thus, alongside the additional federal investments, we've seen a very significant parallel increase by provinces and territories. The investments are working in tandem to increase the spaces, which are now, as of November, at 125,000 spaces created, according to the very last number. Space creation has benefited from both federal and provincial investments.

I don't know if Catherine wants to say anything more about the terms and conditions of the different agreements. You were a bit closer to some of the negotiations.

[Catherine Adam]

That was a few years ago, but each province had a different starting point, and we needed common indicators and common areas that all provinces reported on. For some jurisdictions, it was a much easier goal for them to achieve. They had more robust, mature systems in terms of the kind of data they already collected. In other provinces and territories, it was a bit more nascent. Being able to negotiate while recognizing where each individual jurisdiction was from in order to get to a common set of indicators that we could have a province report on took time, and it also necessitated some degree of flexibility about when and how data could come to us.

Overall, though, all 13 jurisdictions have agreed on the importance of quality data. They committed to that within their agreements. We have a federal-provincial-territorial data working group that has just recently been convened and is beginning to really dig in to make sure there's a common understanding and that help is being shared across the country for jurisdictions to meet reporting needs on data. It's a strong system.

[Anthony Housefather, Liberal, Mount Royal, QC]

I'll ask one other question.

When they get to whatever the growth point is where they have the systems available, what data have we required them to provide in the agreement? What are the metrics they're required to provide after they've expanded their systems and have the ability to provide them? How long in the future is that, and are there penalties associated with not providing the data to allow us to determine if metrics are being met?

[Catherine Adam]

With regard to penalties, every jurisdiction in the agreement commits to providing an annual report, which contains how they have met their space creation targets, metrics on for-profit versus not-for-profit ratio, and metrics on ECEs, workforce, and wage grids. It's a number of things. They are also to provide an audited financial statement of the previous year, so we get an annual report of the previous year and an audited financial statement.

Failure to provide the annual report can result in a delay in the payment to be issued for the existing fiscal year. There have been cases where there's been a delay in payment to jurisdictions because they haven't provided their annual reports. It's not a decision we take lightly. Families are depending on the investment to provinces and territories. However, that mechanism is very much in place, and it also applies to failure to provide an audited financial statement.

[Anthony Housefather, Liberal, Mount Royal, QC]

Thank you.

[The Chair, Conservative, John Williamson]

Thank you very much.

Mr. Lemire, you have the floor for two and a half minutes.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you very much.

Mr. Thompson, in her report, the Auditor General asks Employment and Social Development Canada to do more follow-up. The fact remains that, in Quebec, the early childhood centre program is entirely a provincial responsibility. The unconditional transfer of federal funds has worked remarkably well. The data proves it.

Speaking of data, I'd like to point out that Quebec's ministry of families dashboard lists subsidized and non-subsidized spaces in early childhood centres and family day care centres.

I would like to pick up on my colleague Mrs. Goodridge's idea. In our opinion, if there are five unsubsidized spaces in a day care centre, and we have access to public funds, this increases the number of spaces from five to six. Indeed, we now have the money to hire a new person. Each time, one more child will be able to enter the public system. We even keep track of how many children are on a waiting list and how many pregnant women are registered.

In the answer just given, I understand the donors' desire to have access to data and to know precisely how the money has been used. However, I'm still very concerned and vigilant, because trusting the provinces is a reflex that almost never exists at the federal level.

Isn't it dangerous to add a layer of bureaucracy when each province is asked to provide specific, uniform elements?

Earlier, you mentioned how difficult it was for the federal government to trust the provinces when it came to administering funds.

Do you still have the will to trust the provinces?

[Paul Thompson]

I reiterate that each province's starting point is different. There are differences between the agreements, as we noted above. We have common indicators for all provinces and territories in terms of overall objectives.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Once everyone is brought down to a level that satisfies you, will the old federal reflex of imposing conditions and wanting to manage these affairs return?

Is the federal government going to trust in a decentralization model that works?

[Paul Thompson]

It's a hybrid model, involving federal investment and shared goals. An agreement is negotiated with each province and territory to meet their needs.

There is a negotiation process, and the provinces have the opportunity to administer a program that meets their needs.

The model has common overall objectives across the country, and it offers each province flexibility in terms of program administration.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

I am satisfied. Well done.

[The Chair, Conservative, John Williamson]

Thank you very much.

Mr. Deltell, you have the floor for five minutes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Thank you very much, Mr. Chair.

Ladies and gentlemen, welcome to your parliamentary committee. I would like to welcome you and thank you for being here with us. My warmest congratulations to all of you on the quality of your French. It's really impressive. We appreciate it, and I know that Mr. Lemire joins me in extending our congratulations.

Ms. Hogan, there is one sentence in your report that comes up a lot. I am paraphrasing here a bit, but I think it goes something like this: “We found that provincial and territorial governments, outside of Quebec…”.

I mention this because Quebec has had its own system in place for over 30 years. As Mr. Lemire so aptly put it, it was under the aegis of Pauline Marois, who later became premier of Quebec, that this system was developed and that the early childhood centres, or CPEs, that inspired Ms. Freeland were created in 1997.

Is this not proof that the federal government is intruding into an area of jurisdiction that is entirely provincial, and that the provinces, and Quebec in particular, are capable of working things out for themselves, without the federal government interfering in their affairs?

[Karen Hogan]

When it comes to education and early learning and child care, it's very clear that it's managed by the provinces. The sentence you mention recognizes the fact that the province is starting from a very different position than other provinces. One territory already had day care at $10 a day, but in the rest of the country, it was much more expensive. The agreement with the province of Quebec was also different.

There is still accountability because federal money has been sent to the province. In the accountability process, no distinction was made between federal and provincial money. It was just an accounting to show that we had discharged our responsibilities in this area. It was difficult for us to say whether child care spaces had been created or whether there had been any improvement thanks to federal funding.

It was to recognize the fact that Quebec started from a very different position compared to the rest of the country.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

On page 12, paragraph 18, you clearly state, “We were not able to identify the spending allocation for the Government of Quebec given that its agreements do not require annual reports on the use of federal funding.”

You have had to objectively analyze the situation from coast to coast. Personally, I've never been a fan of one-size-fits-all solutions. I am more interested in adopting best practices. This doesn't mean we have to copy and paste. This means drawing on best practices and applying them according to individual needs. These vary not only between provinces, but also between sectors. CPEs in the urban centres of Montreal and Quebec City are not quite the same as those in the regions. We must respect this reality.

In your study, Ms. Hogan, were you able to assess best practices that could inspire Canadians from coast to coast?

What do you think are the best practices for creating day care spaces?

[Karen Hogan]

Maybe one of my colleagues could add something about best practices. What I can tell you is that the agreements with each of the provinces were very different. They recognized the particularities and needs of each province and provided them with flexibility. However, it was difficult to recognize whether flexibility had been given to a province because it was part of its best practices, or whether it was just its usual way of doing things.

Admittedly, the reality is different in every province. Our aim in reviewing the agreements was not to highlight best practices. There were five targets in the legislation, and we wondered how the federal government was going to be accountable to Canadians for the money spent.

We have seen differences in the net number of day care spaces created. As mentioned earlier in the meeting, this was the net number of spaces in some provinces, and it was just new spaces in others.

It's this lack of consistency in counting spaces that needs to be corrected. We need to have at least consistent measures across the country to be able to say that, across the country, we've created 250 new spaces, for example.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

What you've just said shows the extent to which the federal government has to adjust to each province and region when it invites itself into areas of provincial jurisdiction. From our point of view, it's much better to let the provinces act according to their own wishes. That said, once it's done, it's done, and we try to make the best of it.

Let me come back to what I was saying earlier. Beyond the distinctions that may exist between the provinces, there are still everyday realities, regardless of the province.

People who work and live in a densely populated city are able to walk their children to day care because it's on their way. In rural areas, it's different. I won't tell my life story, but my daughter and granddaughters live in a rural area. I'm very happy about it, and they're very happy about it. However, their reality is completely different from that of people in the suburbs or downtown. It's true in Quebec, and I'm sure it's true in Newfoundland and Labrador—

[The Chair, Conservative, John Williamson]

Please ask your question, Mr. Deltell.