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Gap between rich and poor rising faster in Canada than the U.S. study says

John Morrissy, Financial Post / Postmedia News

OTTAWA — The gap between rich and poor in Canada is rising at a faster pace than it is in the U.S., the country with the largest gap in income equality of 17 peer countries, according to a report Tuesday from the Conference Board of Canada.

“Canada had the fourth largest increase in income inequality among its peers,” said Anne Golden, chief executive of the Conference Board.

“Even though the U.S. currently has the largest rich-poor income gap among these countries, the gap in Canada has been rising at a faster rate.”

The trend has been underway since the mid-1990s, the Ottawa think-tank said….

“High inequality both raises a moral question about fairness and can contribute to social tensions,” Golden said….

The board’s study measures Canada against 17 peer countries belonging to the Organization for Economic Co-operation and Development.

It found that between the mid-1990s and the late 2000s, income inequality rose in 10 of 17 peer countries — including Canada — while it remained unchanged in Japan and Norway, and declined in five countries. Sweden, Finland, and Denmark had the three largest increases in income inequality during the 1990s and 2000s, but all three are still considered low-inequality countries.

Kevin Falcon and Christy Clark get some help from Ministry of Finance bean counters

Charlie Smith, Georgia Straight

Governments spend a great deal of time and effort on massaging their messages to the public. And this was on full display in the B.C. government’s recently updated fiscal plan.

In the first quarterly report, Finance Minister Kevin Falcon revealed that this year’s deficit will rise from $769 million to more than $2.8 billion. For 2012-13, the deficit would increase from $434 million to $805 million.

According to the update, that’s due mostly to slower-than-expected economic growth and the cost of repaying a $1.6-billion HST signing bonus to the federal government.

Following the ministry’s lead, the mainstream media linked the bleaker outlook to the demise of the harmonized sales tax.

The fiscal update also suggests there is no money in the kitty to pay for any public-sector salary increases….

Anytime a government wants to make the books look better (like before an election), it can increase the forecasted economic-growth rate. And when it wants to make things look worse (like before negotiating public-sector contracts), it can reduce its growth estimates….

But I can’t help but wonder if this recently updated B.C. government fiscal plan had more to do with upcoming labour negotiations than with anything else. As the February 2009 budget demonstrated, the Ministry of Finance is willing to massage the numbers upward when it suits the politicians in power. It’s not a surprise that the ministry might do the opposite when Falcon wants to present a grimmer picture to the public.

Children aren’t widgets

Darryl Walker’s blog, President, BCGEU

The expansion of big box, commercial daycare centres in British Columbia is not a good thing. Children aren’t widgets. Their care should not be entrusted to a corporate entity. I mean, would you trust your three-year old to Wal Mart?

Private daycare operator Edleun recently announced it was taking over five daycare centers in BC, including three in the Lower Mainland. As a corporation, Edleun’s focus is to deliver a return to its shareholders.

The only way private daycare centers make a profit is by charging higher fees, paying staff less, and by gambling on real estate. None of these prospects is good for working families. Average families probably can’t afford private daycare – and certainly not if you have more than one child.

We need an alternate vision: a publicly-funded, accessible, community-based early childcare system. And we need it yesterday. We needed it five years ago. This type of care brings out the best in children, is affordable for BC families, and encourages the development of a skilled and committed workforce.

We are being let down. Big box daycare is not a solution. B.C. families deserve better.

Read online

For-profit firm plans seven centres in BC: Critics charge ‘big box child care’ too risky, push for control to move to Ministry of Education

Tracy Sherlock, Vancouver Sun

A for-profit, publicly traded company that is rapidly expanding across Canada plans to open seven child care centres in B.C.

Edleun Group, Inc. purchased five B.C. daycares – three in Metro Vancouver and two in Kelowna – for $4.1 million, Calgary-based Edleun said in a news release. The company also plans to build two new centres in Kelowna.

Edleun’s name is short for Education Learning Universe, and the company says it is the largest for-profit child care operator in Canada with 30 centres. The company’s website states that its goal is to acquire 10 per cent of the 8,800 child care centres in Canada.

This expansion has some child care workers worried about the “commercialization” of child care, expressing concerns that the quality of care decreases when the provider is a for-profit business. But Edleun’s chief executive officer Leslie Wulf said in an interview that his company is all about quality and choice.

“Closing of these acquisitions cements our initial move into the British Columbia marketplace, which broadens national awareness of the Edleun brand and creates new child care spaces in underserved communities,” Wulf said in a news release. “These acquisitions are quite material, both strategically in terms of entrenching our expansion into British Columbia and financially due to their contribution to our bottom line profitability and cash flow.”

However, Sharon Gregson, Vancouver school board trustee and an operator of several not for-profit child care centres, worries about “big box child care.”

“Their primary concern is meeting the needs of their shareholders, which means making a profit,” Gregson said. “The only way, from experience, that anybody makes a profit in child care is by gouging parents with high fees, or gouging workers with low wages and benefits or gouging kids with poor quality care.”

But Wulf said that is “misinformation.”

“We charge market fees and our employees are paid equal to or more than market rates. On an annual basis we do reviews and everybody gets a raise,” Wulf said, adding that the company offers a career path for early childhood educators that smaller daycare centres can’t….

Gregson cited the Australian experience with ABC Learning Centres, which expanded rapidly, then went broke, as a cautionary tale for Canada.

“That should be a big heads up for our provincial governments in Canada as to the dangers of having one company with that much control,” Gregson said.

Michael Lanier, chairman of the CUPE BC child care working group and president of CUPE local 1936, is also concerned.

“In Vancouver, only approximately 20 per cent of children have access to a licensed, highquality daycare,” Lanier said. “The waiting lists are huge. The average fees are anywhere from $900 to about $1,400 a month. That can be a real problem for families.

He says that’s why CUPE supports a new plan that would move child care from the control of the Ministry of Children and Family Development to the control of the Ministry of Education.

The plan, created by the Coalition of Child Care Advocates of BC, has been endorsed by several B.C. bodies, including Vancouver city council and Metro Vancouver. It calls for “Early Years Centre Networks” through which boards of education would take responsibility for child care from the time children are born. The centres could be existing not-forprofit ones that join the new program, centres within schools, or new purpose-built centres.

The plan proposes a public system of child care that caps parent fees at affordable levels (Gregson said it calls for $10 a day for all ages); improves staff education and wages; is open to all children, including those with special needs; and offers play-based programs. The more corporate daycare grows in B.C., the more difficult it will be to move to a public system, Gregson said.

She said Edleun is one of three big corporate players in the Canadian daycare scene; the other two she named are Kids and Company and Core Education Fine Arts.

Kids and Company recently opened its first location in Vancouver, a 10,000-square-foot licensed facility that can accommodate up to 100 children. The company has a unique business model in that employers pay an annual fee for child care space for their employees’ children.

Core Education Fine Arts offers franchises of its junior kindergarten program – for kids aged two to five – and lists 11 locations in Metro Vancouver on its website. The Metro Vancouver Edleun centres, which will have 422 licensed spaces, are in Maple Ridge, Coquitlam and Port Moody….

‘Big box’ daycare setting up in Maple Ridge

Monisha Martins, Maple Ridge News

A publicly-traded company focused on consolidating Canada’s fragmented childcare industry has acquired at least two daycares in Maple Ridge …

Edleun Group Inc. completed it purchase of the Maple Ridge businesses earlier this month and has agreements for two other redevelopment properties, as well an additional centres in B.C….

Located in Maple Ridge, Coquitlam, Port Moody and Kelowna, the five childcare centres with 422 licensed spaces were purchased ….

“These acquisitions are quite material, both strategically in terms of entrenching our expansion into British Columbia and financially due to their contribution to our bottom line profitability and cash flow.”

Edleun estimates there are 8,800 childcare centres across Canada and aims to become a larger player through acquisitions of new and existing operations, with plans to control 10 per cent of the Canadian market….

The company’s aggressive expansion plans, however, worry childcare advocates who characterized Edleun approach as “big box child care.”

“They are not really in the business of childcare, they are in the business of making money for their investors,” said Michael Lanier, chairperson for CUPE B.C.’s childcare working group….

Lanier points to Australia’s ABC Learning Centres as an example of a large-scale corporate childcare operations gone awry. At its height, ABC Learning Centres owned 25 per cent of the daycare spaces in Australia – more than 1,000 – centres but folded in 2008 with $1.6 billion of debt.

Wulf, Edleun’s CEO, was linked to ABC Learning Centres Canadian arm, 123 Busy Beavers.

“The Edleun Group is really involved in the real estate market,” said Lanier.

“They drive the competition out of the area. They buy buildings, set it all up and then they’ve got themselves a real estate investment. They are not really in this because they believe in child care. “…

Sanya Boatter, who owns Start Smart, a for-profit daycare with 170 spaces and a staff of 28, confirmed the company was sniffing around the Maple Ridge childcare market.

She, too, worries about a large corporation, focused on racking in profits for investors, caring for kids….

Edleun Group seeks to consolidate childcare: Company is buying six more centres in Alberta at a cost of $7.1 million

“Edleun will now own or have agreements in place to acquire 17 centres in total. These additions to a rapidly growing portfolio make Edleun one of Canada’s leading childcare operators in a fragmented industry that includes an estimated 8,800 centres across the country. Edleun’s extensive pipeline of potential acquisitions and newly-developed centres should allow it to become a much larger player in this industry.”

Read the news release

Related article: Globe and Mail
July 21, 2010