Should child care be at mercy of market? International herald Tribune – Business with Reuters – The Global Edition of the New York Times
By Meraiah Foley
November 28, 2008
…. The collapse of the company, which looks after about 120,000 Australian children, or 25 percent of the day care population, has sent the government scrambling to avoid the economic and political fallout of leaving tens of thousands of working parents stranded without child care services.
Critics say the rise and fall of ABC Learning will become a textbook case highlighting the dangers of allowing the private sector to dominate essential services like education, care for the elderly and utilities.
“This is not just an Australian story,” said Deborah Brennan, a social policy expert at the University of New South Wales, who has been studying ABC for the past 18 months.
“It is a story about where a rather blind belief in market forces can get you in the area of community services.”…
Women tolled warning bells but no one wanted to listen Sydney Morning Herald
Adele Horin
November 8, 2008
The women knew. For some time ABC Learning Centres had troubled the child-care experts. The company’s baffling balance sheets did not make sense and the labyrinthine company structures were a worry to them.
But no one took notice of a bunch of female child-care experts with degrees in early childhood education and politics. Critics were dismissed as ideologues and anti-business, and told they were picking on ABC. …
Community operators keen to step into ABC void ABC TV News
Nov 7, 2008
ABC Learning was placed into administration yesterday….
Lynne Wannan, the immediate past convenor of the National Association of Community Based Children’s Services, says it would be “foolish” to let the company return to its previous business model.
“It is extraordinary to imagine that they would ever have been able to see you could return shares to shareholders. So there was no other route for them than to end up like this,” she said.
“To imagine that you are ever going to have millions and billions of dollars t2o return to shareholders and banks based on the revenue that you get from childcare is ludicrous.”
…. “It is not a complex task to manage children’s centres and those community ones that have been operating for 30 to 40 years, they can do it. They manage. That is what they do on a day-to-day basis,” she said…
Receivers to take over ABC Learning The Australian
Nov 5, 2008
ABC Learning, the childcare centre operator that looks after 100,000 Australian infants and toddlers, is today expected to be swept into receivership after months of escalating financial trouble.
THE collapse of ABC Learning is an opportunity for the Rudd Government to rethink the fundamentals of Australian early education and care….
How did we get into this mess? Deputy Prime Minister Julia Gillard has blamed John Howard for “letting the market rip”, but it was the Hawke government, in 1991, that introduced market forces into the sector. It did this by extending child-care assistance to the users of for-profit care and then by changing the structure of Commonwealth funding to encourage private provision and marginalise the community sector.
Labor promised that the market would lead to greater choice and lower fees. It decreed that private businesses, not governments, should determine the location of services, even though huge public subsidies were involved. Under Labor’s system, there was no cap on the number of long day care centres that private operators could set up….
National Report Cards show government results fall short of promises
OTTAWA, ONTARIO – The Canadian Labour Congress gave the federal government a failing grade today for its lack of action on providing working parents with more access to affordable, quality child care spaces.
At a news conference on Parliament Hill, Barbara Byers, executive vice-president of the Canadian Labour Congress, released a full set of report cards, grading the provinces and the federal government on their overall performance when it comes to delivering the child care services working families need.
Based on public data provided by or through governments, the report cards measure progress (or lack thereof) in three areas: 1) affordability, measured by what it costs parents to access child care services, 2) quality, measured by the salaries paid to child care staff, and 3) accessibility, measured by the creation of new public child care spaces.
Manitoba scored the highest mark, with a grade of B+ while the lowest mark, a D-, was awarded to British Columbia. The federal government, meanwhile, was given an “incomplete” grade.
“They aren’t getting the job done for working parents. Fees are going up. New spaces are being created at a much slower pace than before. Wages for child care workers continue to range from fair to far too low. Provincial governments could do so much more if the federal government was there with stable, predictable funding and support,” says Byers.
“It’s an undeniable fact: the vast majority of today’s Canadian moms are working moms. More than 65% of women with children under three years old work outside the home. Meanwhile, 75% of women with pre-school kids (between three and five years old) are in the paid workforce.
Yet, despite this clear demand for services, says Byers, only 16% of children in Canada had access to a regulated child care space in 2004. Since the Conservatives, led by Stephen Harper, took power in 2006, things haven’t improved. Working women continue to face a surplus of promises and a shortage of results.”
Quebec was not included in the Canadian Labour Congress survey because of that province’s advanced child care and early learning services. With just 22% of Canada’s children, Quebec accounts for 45% of the country’s total regulated child care spaces and 78% of the total increase in public funding since 2001. Including it in the survey would be like comparing scrambled eggs to quiche.
Meanwhile, events are planned across the country in the coming days at the provincial level by parents and child care activists to review how their respective province or territory scored and how to work at improving grades.
The report cards are part of the Canadian Labour Congress “Equality! Once and for All!” campaign. For more information about this important campaign for women’s economic equality, or to see the full set of report cards, visit the web site www.onceandforall.ca.
The Canadian Labour Congress, the national voice of the labour movement, represents 3.2 million Canadian workers. The CLC brings together Canada’s national and international unions along with the provincial and territorial federations of labour and 130 district labour councils.
TUESDAY, MAY 20, 2008, Afternoon Sitting COWICHAN VALLEY SCHOOLS AND CHILD CARE SPACES View online
[DRAFT TRANSCRIPT ONLY]
J. Horgan: My question is to the Minister of Education. She will know that on February 1, the Cowichan school district started a process to close four schools. Four months have gone by, and in that time she has received a report from her special adviser speaking to the need for those four schools. But more importantly, today parents are not just looking for spaces for their children to go to school; they’re looking for spaces for child care. With the closure of those four schools, 260 spaces will be lost.
It’s a very simple question to the Minister of Education. Will she stand in this place today and assure that those spaces will remain for child care in September?
Hon. S. Bond: Well, the member opposite is correct. In fact, this government did respond. We sent a special adviser to do work in the Cowichan school district, because we in fact expressed concerns, as well, about schools that are important — schools that parents were very concerned about. The member opposite knows that I had met with a number of parent groups about the Cowichan school district.
The report has been received. We will be presenting that report to the board of education. The recommendations are significant. They certainly point to some significant concerns for me as Minister of Education, but that report will be passed on to the board of education for their review and then made public.
J. Horgan: I know the parents in the Cowichan Valley will be waiting anxiously for Monday night with respect to the school spaces, but this is a particular question about child care. It’s a crisis in the valley. There are not enough spaces. If these schools go down, 240 child care spaces at a minimum — up to 260 — will be lost. Can the minister confirm that the report that will be issued by the board from the special adviser will include those child care spaces? [DRAFT TRANSCRIPT ONLY]
Hon. S. Bond: I’m sure the member opposite would want, first of all, to allow the board of education to see the report that’s been prepared. It will be made public as quickly as possible after that. We had an excellent special adviser that did the work and looked at the issue of school use. One of the important considerations was the capital plan or lack thereof in this particular school district. All of those issues have been considered. There are a series of recommendations. The board will see the report, and it will be made public.
D. Routley: As a former trustee I can tell the minister that there is a capital plan that keeps coming up every year, and that is to close more of our neighbourhood schools due to funding shortages brought on by that minister. She is imposing growing deficits in our community.
We are seeing real people, real families, real children losing their child care spaces, real workers who can’t take jobs because of it, and real businesses who suffer. Schools in our district are at capacity if you consider school-age children and child care spaces. The minister said she’ll find spaces for those displaced students, but there’s no such help for the parents who will lose their child care space.
This minister should stop spewing out numbers and face the real truth. Families are suffering by her policies. Will she finally coordinate her efforts with the Minister of State for Childcare and ensure that those spaces remain open for the people of the Cowichan Valley and their children?
Hon. S. Bond: We recognize the concerns that parents in the Cowichan school district have expressed. The member opposite knows full well that a very, very capable special adviser was placed to do an incredibly good job of looking at all of the issues, which includes the necessity for child care spaces.
But one thing we are going to do on this side of the House is talk about numbers. We’re going to talk about the fact that the Cowichan school district received a funding increase of $3.7 million since 2001-2002 at a time when they have lost almost 1,400 students. We’ve put record levels of funding into public education, and we’re going to continue to do that on this side of the House.
CHILD CARE SPACES IN B.C.
C. Trevena: The minister talks about numbers, but I think we are talking about real people here. We’re talking about an operating room nurse who will lose child care. We’re talking about people who are invested in the community. We’re talking about a mom who wants to go back to school, who won’t be able to go back to school because of the loss of child care spaces.
This isn’t just an issue of the Cowichan Valley; it is an issue of the whole province. Everywhere people are scrambling. In the Minister of State for Childcare’s own riding there are 80 people who turned up for an open house trying to find a child care space and basically begging providers for space.
My question is for the Minister of State for Childcare. There is a big problem in this province with child care. There is a crisis. When will she recognize that, and when will she actually do something about it — not just talk about new spaces being created but create real spaces for real parents who have real problems getting child care?
Hon. L. Reid: So $300 million of investment, and I’m happy to say that I’ve just canvassed these issues with the critic not so long ago, so she knows of what she speaks in terms of attempting not, frankly, to be straightforward with the public in the province of British Columbia. She knows…
Interjections.
Mr. Speaker: Members.
Hon. L. Reid: …that she hasn’t been straightforward, and she knows, quite honestly, that 2,200 spaces have been created and that, frankly, our goal was 2,000 spaces. We have exceeded by 200 spaces the number of child care spaces created in British Columbia.
Dollars have gone out for subsidy. Dollars have gone out for child care operating funding. Dollars have been put in place for recruitment and retention of staff. Everything that the sector has asked for has been delivered, and indeed, that….
Interjections.
Mr. Speaker: Members.
Minister, partway through your statement you used the word “straightforward,” referring to the member from the other side. Would you withdraw that statement, please.
C. Trevena: Teddy Bear Daycare in Whistler is due to close. Apparently, it’s not an appropriate use of the space with the Olympics coming.
But when the parents turned to the Minister of State for Childcare for help, she wrote them with some alternatives: child care in Squamish, which is a 54-kilometre one-way trip for parents and their children; child care in Pemberton, where one centre is full and the other is closing; or child care in Spring Creek, which is only 40 kilometres a day but already close to capacity.
It’s not surprising that the parents were flabbergasted and described the minister’s response as ridiculous. I’d like the Minister of State for Childcare to explain to those parents, who are desperately needing child care, what they’re supposed to do.
Hon. L. Reid: It is about the spaces in British Columbia. I am more than happy to put on the record yet again that since we came to government, we’ve created 5,500 additional child care spaces in the province of British Columbia.
Interjections.
Mr. Speaker: Members.
Hon. L. Reid: We have in fact been the only government who’s lifted the rates for out-of-school care, the only government who has in fact looked at extending the subsidy for children into the end of their sixth year.
When the community has asked for the deliverables, we have in fact responded.
Mr. Speaker: The member has a supplemental.
C. Trevena: Yes, the minister of state has responded, but the minister of state has given answers that provide no solution for parents either in Whistler or anywhere in the province. Parents are desperate.
The Minister of State for Childcare said in this House a couple of days ago: “Everything the sector has asked for has been delivered.” I have to say that parents say she’s wrong, providers say she’s wrong, early childhood educators say she’s wrong, chambers of commerce say she’s wrong, and businesses say she’s wrong.
I’d like the minister to tell those thousands of people how she’s planning to prove herself right.
Hon. L. Reid: I’m always delighted to talk about child care. We in fact have new partners in child care delivery that this province has never had in the past. We are building child care today with the B.C. housing association. We have in fact delivered child care where people live, closest to home. We have worked with individuals as partners, indeed, in terms of providing child care closest to where people work.
There are opportunities today to go forward. There are opportunities for us to continue to work closely with those who believe in the delivery of child care. I welcome that opportunity.
VANCOUVER, May 15 /CNW/ – Low wages are one of the key contributors to the crisis in child care – something the BC government refuses to acknowledge.
Early childhood educators, unable to make a decent living, are being forced out of their field. Employers of all sizes – from group centres to family providers – can’t find or keep staff.
Quality child care promotes healthy development and enables working families to access the labour market. It helps build communities and supports the economy. So addressing child care shortages is in everyone’s interest.
But until the government addresses this serious problem of recruitment and retention, any plans to create child care spaces will not succeed. You still need to staff the spaces. And the inability to find substitutes means what few staff there are do not take their vacation days or sick days, leading to overwork and burnout.
The minister of state for child care thinks doling out last fall’s capital funding grants will create up to 2,200 spaces. But she shouldn’t count these spaces before they’ve hatched – they still need to be built, staffed and stabilized.
The cause of this staffing crisis is inadequate pay. A survey recently conducted by First Call, a BC advocacy group, found qualified child care workers are leaving the field because the low wages and lack of benefits leave them unable to support themselves or a family.
New census data from Statistics Canada shows just how serious the problem is. There is a huge and growing gap between what the average worker in BC earns compared to most child care workers. Average annual earnings for full-time early childhood educators in BC actually fell by 12.3% between the years 2000 and 2005. The person who cares for your children now earns a paltry $20,632.
The job numbers show the effect of these low wages. While the province’s overall workforce grew by 8.7% over the same five-year period, the number of early childhood educators shrank by nearly 3%. This is hardly surprising. Why would someone stay working as an early childhood educator if they couldn’t then financially provide for their own kids?
Without sufficient stable funding, spaces are vulnerable to closure, as we’ve seen happen across BC. A UBC-based network, the Consortium for Health, Intervention, Learning and Development (CHILD), calls this a “fragility” of service.
So what’s the solution? Parent fees are already too high and families cannot be expected to subsidize their child care any further. We need government funding. And yet, government funding per regulated space in BC is down since 2001, according to data collected by the Childcare Resource and Research Unit.
In other provinces, governments have taken measures to address the child care crisis. Manitoba, Saskatchewan and Alberta have all recently announced increased child care wages through wage supplements. Early childhood educators in Alberta will earn up to $20.82 an hour. But here in BC, the government still has no plan to increase wages for early childhood educators.
Other provinces have figured out how to fix the problem. Why can’t BC?
George Heyman, President, BC Government and Service Employees’ Union and Susan Harney, Chairperson, Coalition of Child Care Advocates of BC
Six controversial decisions that failed to deliver on Canada’s “promise of equality” and have been rewritten by the Women’s Court of Canada.
“SYMES V. CANADA
In this case, the Supreme Court of Canada disallowed Ms. Symes, a self-employed woman, from claiming her childcare expenses as a business deduction for income tax purposes. This decision was in accordance with traditional tax analysis, which characterizes childcare expenses as personal expenses.
The Women’s Court takes a different view. Tax policy must take account of background social context. That context shows that women have suffered, and continue to suffer, social and economic inequities in their paid and unpaid work. The traditional tax treatment of childcare expenses is based on outdated cultural norms that privilege a conception of working life adapted to the needs of businessmen.
The Women’s Court reverses the decision of the Supreme Court and holds that businesspeople who legitimately incur childcare expenses for the purpose of gaining or producing income from business must not be deprived of the benefit of a business deduction for their expenses.
Key to this case is our understanding of substantive equality as a fundamental constitutional principle that requires recognition of the inherent moral worth of each individual and acknowledgment that full realization of this worth cannot be achieved through a simple uniform application of rules. This perspective must inform judicial review of discretionary governmental decisions and statutory interpretation.
Therefore, the Women’s Court finds that the government has a duty not only to refrain from discrimination but also to correct existing disadvantages through the formulation of appropriate law and policy.
Courts, in turn, must ensure that governments are fulfilling their obligations by doing all that is “practically possible” to promote substantive equality. Judgments that account for substantive equality considerations must, by definition, take into account the full context surrounding the law or policy in question. “
[NOTE — Background — “Lawyer Melina Buckley rewrote the 1993 Symes v. Canada decision, a case she knew firsthand and that had troubled her because of the decision’s “lack of acknowledgement of the public good of caring for children.” Essentially, the Supreme Court ruled against allowing the deduction of child care costs as business expenses (like, say, golf club memberships). In her Women’s Court alternative decision — which she says “provided me with an opportunity to explore my initial sense of outrage … in a concrete, disciplined fashion” — Buckley writes that child care expenses must be recognized in the larger context as both gendered and a social responsibility.”]
The Women’s Court of Canada
Gwen Brodsky; Melina Buckley; Marie Chen; Rachel Cox; Shelagh Day; Mary Eberts; Avvy Go; Jennifer Koshan; Sonia Lawrence; Diana Majury; Sharon McIvor; Teressa Nahanee; Margaret Parsons; Dianne Pothier; Denise Réaume; Kate Stephenson; and Margot Young.
“The Women’s Court is a group of Canadian lawyers, law professors and activists who have decided it’s time to get serious about women’s equality.”
“Sure, most civilized Canadians have a fundamental philosophical belief in gender equality (even if old-school male-chauvinist sexism seems, depressingly, to be on the rise again in our popular culture. And that’s another debate). But gender equality is not a fact in Canada’s courts, and the repercussions of that implicit inequality are like shock waves in the daily lives of millions of Canadian women.”
“It’s rewritten six key decisions handed down by the Supreme Court of Canada — decisions with powerful impact, in different ways, on the lives of women. It’s looked carefully at the Supreme Court’s ‘because I said so,’ and, in scrupulous legal detail, asked, ‘But why?'”
OTTAWA – The minority Conservative government has let Canadians down with a budget short on the vision and leadership needed to address the most pressing issues of our time, says the Canadian Centre for Policy Alternatives (CCPA).
The federal budget does little to address poverty, climate change and provide long-term help for Canada’s struggling communities – despite urgent need.
“Big problems require big solutions, and they’re nowhere to be found in this budget,” says CCPA Senior Economist Marc Lee. “The funding announced today may fulfill its roll as a PR strategy but it doesn’t come close to the kind of investment that our cities need to stay vibrant and competitive.” …
“This budget does nothing substantive on poverty reduction or measures for First Nations, nor does it minimize the economic insecurity facing Canadian families,” Yalnizyan says. “This is a budget for the rich – not the rest of us.”
“This government has cut and run on ordinary working families. The Conservatives are claiming poverty yet somehow they’ve found money to hand out to Canada’s most affluent in the form of Tax Free Savings Accounts,” says Lee. “They’ve blown an opportunity to make real investments that position Canada for the future.”
OTTAWA — “The Federal government set expectations low going into the budget, and they met lower than low expectations, said Paul Moist, national president of the Canadian Union of Public Employees.
Minister Flaherty did not address health care, child care, poverty or homelessness, and there are no long-term solutions for the municipal infrastructure deficit…
The budget introduced a new tax shelter in the form of a tax-free savings account. “What good is a tax-free savings account if you have no prospect of having savings? Few Canadians are even able to contribute to RRSPs let alone have any other savings. Essentially the Harper government maintains that wages must be taxed – but investment income is tax-free,” said Moist….
“Canadians want increased funding for public services: including health care, child care, a robust infrastructure fund that is not tied to privatization efforts, and a real commitment to tackle the pressing problems of climate change….
What Finance Minister Jim Flaherty calls a budget of “focus, prudence, and discipline” is actually “feeble, paltry and disappointing,” says Larry Brown, secretary-treasurer of the National Union of Public and General Employees (NUPGE). …“But when it comes to the key challenges facing working and middle class families, the only thing today’s budget delivers is a surplus of rhetoric, and a major deficit when it comes to real action. The budget has a few small measures aimed at placating Canadians, but there will be no real relief for those that are hurting, and no real solutions to the problems facing our economy…. He pointed out that the budget offers little or nothing to address the serious concerns of Canadians, such as reducing health care wait times, confronting climate change, improving long-term care for the elderly, creating affordable child care spaces, dealing with the crisis in the manufacturing sector, reducing college and university tuition fees, strengthening pension security and expanding social services. The budget also ignores the large and growing income gap in Canada….
The BCGEU says that in today’s federal budget, the Harper government has “squandered” another chance to make a major investment in a national child care system to meet the urgent needs of Canadian families.
“With such a massive $13 billion surplus, the Conservative government had the financial tools to make child care a priority,” says BCGEU president George Heyman. “They could have done a lot to alleviate the severe shortage of spaces across the country.
“But with the choices they’ve made in this budget,” charges Heyman “the Harper government has squandered the opportunity to make a sound investment in child care and provide much needed assistance for tens of thousands of Canadian families.
“They’ve set their priorities: tax breaks for big corporations and $10 billion of debt reduction are more important than the needs of children and families.”
The federal budget does nothing more than preserve the status quo, says Heyman, which is to maintain the current taxable $100 per month child benefit payments to parents.
Soon after they were elected in 2006, the Harper government cancelled a federal-provincial agreement that would have created and funded a national child care program. Billions in child care funding was replaced by the $100 a month benefit.
“These piddling payments do nothing to create spaces or give parents choice,” Heyman says. “The Conservatives-who seem to oppose child care in principle-have done nothing to address long waitlists, parent fees that are too high, nor the alarming shortage of qualified child care workers.”
The BCGEU and other child care advocates have been calling for the federal government to fund a quality, accessible, universal, non-profit child care system. Even business groups recognize the benefit of creating a national child care system, Heyman says.
Heyman points to the positive economic spin off benefits in Quebec, where a provincial child care system costs parent $7 a day. Greater access to affordable spaces has allowed women to return to the work force to help alleviate a shortage of skilled workers, creating the highest participation rate of women in trades anywhere in Canada.
CUPE has released a legal opinion suggesting that if the federal and provincial governments don’t act fast, a company called “123 Busy Beavers” might make universal child care an impossibility.
The opinion – by noted trade lawyer Steven Shrybman examines NAFTA rules around public services and foreign investment. Paul Moist, Shrybman, National Child Care Advisory Committee Chair Shellie Bird, and Tracy Freitas, Early Childhood Educator and CUPE 2204 member, released the opinion at a press conference Apr. 1.
Canada has for-profit child care, but it’s mostly delivered by small businesses and individuals. There is little – if any – foreign investment.
That could change though, as a company with ties to Australian child care ABC Learning Centres has been buying up for-profit child care centres in Alberta, BC and Ontario.
And if the amount of for-profit child care delivery grows, and if the amount of foreign investment grows too, Shrybman argues, child care would be considered a commercial venture, rather than a “reserved” public service, under NAFTA.
Any new program – such as the national child care program envisioned in Bill C-303 or even the Ontario government’s plan for full-day kindergarden – could be considered a violation of the rights of the for-profit child care sectors’ investors.
A government that still wanted to proceed with a publicly-delivered child care program would have to pay damages to any foreign company whose profits were affected.
Shrybman argues the only way for the federal and provincial governments to preserve their right to create a public child care program is to use it.
“Once the door is opened to foreign investment in the child care sector, it may be impossible for governments to close it,” he argues.
This opinion builds on a 2004 legal opinion Shrybman produced on the former Liberal government’s plans for a national child care program.
Related articles:
Union report sounds alarm over foreign daycare chains; CUPE warns trade rules could be used to block universal public system TORONTO STAR
By: TONDA MACCHARLES
April 2, 2008
…. A legal opinion prepared for the Canadian Union of Public Employees, … warns there are risks if Ottawa does not limit foreign corporations – like Australia’s ABC Learning Centres Ltd. – from buying up small child-care operators in Alberta, B.C. and Ontario.
International trade lawyer Steven Shrybman says that under NAFTA rules, foreign investors, if they become significant players as daycare providers, would be able to challenge future “public policy” efforts by governments to regulate or expand child care.
… Right now, governments can limit or ban foreign investment in child care and “preserve future policy options,” he said. They can require a child-care centre to hire locally, provide service to a particular region as a condition of its licence, or ensure that parents and members of the local community comprise a majority of the board of directors.
But if federal and provincial governments do not exercise their right to regulate foreign corporations, those companies will be in a position to sue for damages if future government measures “impinge on those investments.” … “the prudent course for provincial governments would be to restrict foreign investment in the child-care sector,” said Shrybman.
“If they fail to do that, the future of child-care services in Canada may well be determined not by communities or by governments, but by private tribunals meeting behind closed-door meetings in proceedings at World Bank headquarters in Washington, because that’s where these disputes will be resolved.”….
NOT FOR SALE: PROMOTING PUBLIC SOLUTIONS IN TODAY’S ALBERTA Vue Weekly – Edmonton
SHANNON PHILLIPS
…. Privatization, says Moore-Kilgannon, is the “common thread at the root of so many problems …. Consistent through all these sectors is that they are under constant pressure—waiting lists, cutbacks, poorer quality of services.”
Moore-Kilgannon explains that privatization is part of a familiar cycle: governments reduce spending on public services, sometimes dramatically. The public sees a downturn in services, and demands change. The private sector—often massive multinational corporations—steps in to offer solutions. Those solutions are sold to the public as cheaper and more efficient.even though Moore-Kilgannon says the evidence most often shows they are neither.
Research has shown privatized health, child care and seniors’ services to be more expensive—both to individuals and to governments. A layer of profits has to be skimmed off the service for it to be a viable business venture, and those profits come from either cutting back on wages or quality or by raising fees.
Australian social policy researcher Deb Brennan, an expert on child care, says all of that and more has happened in her country…ABC built their business model upon government subsidies.
Australia used to fund child care as many other developed countries do: giving direct subsidies to non-profit and community-run centres. Now, they simply cut a cheque to parents, who are then able to “choose” the child care services they like best.
Non-profit centres have since all but disappeared, bought up by ABC and other for-profit ventures. Fees have gone up and wages for workers have stagnated. … Last year, ABC received $150 million (CAD) of taxpayers’ money.
Australia elected a new, more left-leaning federal government last fall, but Brennan says it’s made precious little difference in the government’s approach to child care.
“They’ve just announced the government will now cover 50 per cent of child care fees. That’s just an open invitation to for-profit operators to raise fees.”
Brennan says there are no rules constraining how much child care operators can charge. “It’s part of the philosophy of letting the market decide. But the quality and standards are very mixed for the cost.”
… She says Canadians need to take a hard look at market-based models, “to find out whether this model actually delivers high quality early learning and care services. In Australia, it doesn’t.”
…Just six months ago, a division of ABC bought 11 child care centres in Alberta, as the province has boosted Australia-style subsidies for parents. Called Busy Beaver Learning Centres, the ABC subsidiary had also been looking for more opportunities in BC and Ontario….
BCGEU Campbell’s carbon tax not revenue neutral for working, low income people EXCERPT Feb 19 ’08
B.C.’s new carbon tax is being implemented unfairly, says the B.C. Government and Service Employees Union, and will mean that families and low income earners will pay more than their fair share of the costs when the tax on energy consumption is fully implemented in four years time.
….On other key issues, “aside from the green budget focus,” says Heyman, “the finance minister had only hot air or empty platitudes to deal with British Columbians’ other priorities.”…
Heyman was also disappointed that there is no provincial funding for a new child care system, to help B.C. families deal with the long waitlists, high parent fees, and alarming shortage of qualified staff.
Meanwhile, on the social services front, Heyman says new money allocated in the budget still doesn’t make up for the deep cuts implemented during the Campbell government’s first term. …
BCTF Campbell budget short-changes kids again
EXCERPT
Feb 19, 2008
The Campbell government has once again brought down a budget that totally fails to deliver to K–12 education….
There is no new funding for K–12 despite many new requirements. There is nothing for new requirements for physical education, new English curriculum, or new requirements for carbon neutrality for school districts. The projected budget has not provided a single dollar for these.
The budget provides no money for lowering class sizes to those promised in Bill 33. It provides no money for students with special needs and the specialist teachers to support them. It provides no money for teacher-librarians, despite claiming that improved literacy is a major goal of government.
“It’s as if the premier has completely forgotten that his government is responsible for education funding in this province,” said the BCTF president….
CUPE BC Budget ‘green’ spin leaves public services in the cold
EXCERPT
February 19, 2008
Carbon tax hype draws attention away from funding needs for women, children, students
VICTORIA—The provincial budget’s overwhelming focus on ‘green’ initiatives such as the new carbon tax is drawing attention away from critical funding shortages for K-12 and post-secondary education, community services, childcare, and housing, the Canadian Union of Public Employees said today.
“Our public services are becoming unsustainable. This budget does nothing to retain services for women, children, students and institutions,” said CUPE BC secretary-treasurer Mark Hancock.
…. Hancock noted that the province is committed to capital funding of for-profit childcare spaces, which will only lead to cuts in pay for childcare workers. “The only money for childcare is coming from the federal government, and it does nothing to address the recruitment and retention problems in child care, because childcare workers don’t get paid enough,” he said. ….“This budget just continues the burden on people in this province who need those services. With the kind of surpluses we have, surely now is the time to undo some of the damage the Campbell government did in its first term.”
An education business in China has touted the name of Brisbane-based ABC Learning Centres to promote a bilingual “5-star” kindergarten venture – despite the childcare giant denying knowledge of the plan.
The proclamation came in an error-riddled online announcement from American TPR English School. The announcement was pulled following Courier-Mail queries and a Chinese news article.
“The (Chinese) claims are false and we are investigating,” ABC said.
The news comes weeks after a rapidly expanding ABC rejected claims of having operations outside Australia, New Zealand, the US and UK – and of being behind the Australian-backed 123 Global businesses….
The developments came after Canadian politicians and media claimed ABC was behind 123’s recent establishment of operations in the North American nation.
ABC and 123 rejected this and maintained they are separate businesses, although they have a series of ties for ventures including staff recruitment and centre acquisition….
ABC Acquisitions is now 123 Global. ABC Learning previously rejected Citigroup analyst doubts about ties between Learning and Acquisitions.
TPR highlighted links between Learning and Acquisitions but confused issues such as ownership….
Mr Jones, also a director of 123 Global Holdings (China), said a reference in the article to 123 being an ABC “subsidiary” was wrong.
Tom Mould, another 123 Global Holdings (China) director, was photographed signing the memorandum.
He is also listed as company secretary of Independent Colleges Australia, a non-profit schooling entity which has ABC executives Le Neve Groves and Martin Kemp on its board….
…. Chief executive Tim Boyle said the firm had good growth prospects for 2007/08.
“We’ve got a very strong corporate pipe and also we’ve got some strong prospects for property in the back end of 2008,” he said….
Austock’s property investment management business has surged in the past two years from just over $100 million to $675 million in funds under management at June 30 2007.
Much of that growth was driven by its management of property trusts leasing hundreds of childcare centres to the fast-growing ABC Learning Centres Ltd.
The childcare provider is now aiming at the US market ….
Straight Goods
by Ginette Petitpas-Taylor [Ginette Petitpas-Taylor, of Moncton, is Chairperson of the New Brunswick Advisory Council on the Status of Women.]
EXCERPT
It sounds like a joke, but some people are getting extremely rich providing child care services.
To New Brunswickers who have ever purchased or provided childcare — even those who have owned one of this province’s many for-profit daycares — that sounds incredible, even suspicious. How could you ever make a real profit, let alone get rich?
[If for-profit services to children made sense, we would let businesses organize our education system.]
How large corporations are doing it is by cutting costs and (according to some studies) cutting corners, and by subsidy milking — concentrating on regions where governments provide subsidies.
Many governments have immunized themselves against the practice. They say children’s interests don’t mix with profit making and so, they limit expansion of childcare services to the non-profit sector.
After all, if for-profit services to children made sense, we would let businesses organize our education system.
Apart from “How can you make a profit in that business?”, the more important question for a community and a government to answer is: “Do we want child care services whose first priority is to the shareholder, not the child?”
CHILDCARE giant ABC Learning Centres had tender processes questioned at a meeting where it talked up Labor’s federal election win and the possibility of a Democrat taking the White House….
Shareholder Jit Mau queried $74 million in untendered work given in fiscal 2006 to a maintenance and renovation company run by Mr Groves’ brother-in-law….
Mr Zullo and Mr Groves have co-invested in outside business. Land documents also show they bought and resold property to each other.
QMS’s work had been reported as a “related-party” transaction for years but ABC stopped publishing such details this year after realising there was no obligation to do so under revised accounting standards….
Mr Mau told Mr Groves to “take a cold shower, have a look at yourself in the mirror and ask yourself have you done the right thing”….
(Bloomberg) — ABC Learning Centres Ltd., the world’s biggest publicly traded owner of child-care centers, cut its profit forecast for 2008 because a rise in the Australian dollar reduced the value of sales abroad….
ABC in August posted an 88 percent gain in second-half net income to A$81.5 million for the six months ended June 30. The company, which gets about 45 percent of sales overseas, spent more than $700 million last year buying child-care centers in the U.S., Australia, New Zealand and the U.K. to tap rising demand for daycare services….
A TOP executive at childcare giant ABC Learning Centres established a private staff-recruitment business that later won exclusive contracts with the stockmarket-listed company.
The executive was listed as the business’s sole director when the contracts are understood to have been won, although documents filed later said another businessman had actually been in charge.
Brisbane-based ABC maintains the organisation is separate but it marks the latest case involving outside companies that do not appear on ABC’s accounts….
ABC Acquisitions’ sole director is Donald Jones, who like ABC Learning, has said the outfit is an independent operation. Mr Jones is also executive director of 123 Busy Beavers, which recently started trading in Canada.
Company documents show 123 Careers, which Mr Jones now solely owns, was created in April 2005 – the director was listed as Jillian Reynolds, ABC’s chief operating officer.
On March 23, 2006, Ms Reynolds was recorded as signing company documents again naming herself as director.
But in mid-2006, Mr Jones signed documents saying he had actually been the sole director since April 2005 and shareholder since December 2005.
The timing is important because it is believed that in February 2006 ABC sent a memo to casual centre staff saying 123 Careers (under its previous name Childcare Services Recruitment) had won a contract beginning in April that year.
Staff who wanted “to continue working” as a relief worker had to transfer employment to 123 Careers.
ABC chief executive officer Eddy Groves confirmed an exclusive arrangement, could not verify the contract’s exact months, but said 123 Careers was not a related party….
He said Ms Reynolds – who has not responded to interview requests – had been “proactive” in setting up the company, only later seeking ABC approval.
“We said that wouldn’t work because she would be a related party transaction, so she let that go and transferred it to Don (Jones),” Mr Groves said.
ABC also said it did not want to run a recruitment business because it was focused on childcare, he said.
Asked about the directorship and shareholding changes recorded in mid-2006, he said: “They were slack on the paperwork.”…
Mr Groves said Mr Jones was running the operation “from the get-go”.
Mr Jones, meanwhile, would not be interviewed, but wrote that 123 companies were private businesses.
Professor Natalie Gallery of Queensland University of Technology’s School of Accountancy said, generally speaking, any transactions with key executives in 2006 should appear as a related-party transaction.
The 123 Careers 2006 return shows a $1.3 million loss in fiscal 2006 off revenues of $25.5 million.
Including a $27.3 million intangible “right of children supply” asset, it had a shortfall in net assets of $1.3 million.
The auditor signed off the accounts stating: “The entity’s ability to continue operations and meet its debts as and when they fall due is dependent on financial support pledged by the sole director Donald Vivian Jones”.
SUSAN Elson thought the childcare meeting with Australians in Canada had odd moments.
“They did not have business cards. They did not have brochures. They did not have anything,” recalls Elson, who has been involved in accrediting child care in Canada.
The June meeting in a small Edmonton conference room was just one precursor to the start of Canadian operations in recent weeks for Australian-backed childcare group 123 Busy Beavers Learning Centres.
It was a quiet beginning to a firestorm about Busy Beavers’ links to Brisbane-based ABC Learning Centres.
Now ABC – whose rapid expansion to over 2200 centres in Australia, NZ, the US and the UK has raised questions – has denied moving on Canada.
Stockmarket-listed ABC also maintains Busy Beavers and other 123 companies are separate, independent entities. That means ABC has no control over operational decisions, and the businesses themselves do not appear on ABC’s accounts.
That hasn’t convinced some Canadian politicians or media, who published views that ABC was behind the push.
The Canadian reception has been hostile, with headlines blaring multinational “big box” child care is set to arrive. Organisations such as the Canadian Union of Public Employees are sounding concerns about quality at profit-run child care.
Elson, an exponent of non-profit community care, is another who is sceptical of ABC’s distancing itself from Busy Beavers.
“I’m not an idiot, it becomes clear,” she says.
ABC, which last week blamed the strong Australian dollar for a profit downgrade, already had Canadian links.
The parents of Eddy Groves, who co-founded ABC with wife Le Neve, were Canadians and he retains Canadian citizenship.
Asked in 2005 by The Toronto Star about setting up in Canada, Groves said: “What a great excuse to go back to that beautiful country.”
He downplays any move now.
“They (Canadian media) think they’ve joined the dots,” he says. “People over there have tried to emphasise their cause of not-for-profit by using me as a whipping boy to try and get their point up.”
But, as revealed in The Courier-Mail last month, ABC in August set up a company called ABC Canadian Holdings.
“We contemplated (a move) but we chose not to do it . . . we thought we should concentrate on the US,” Groves says.
The corporate origins of Busy Beavers – whose mascot is a Canadian shirt-wearing beaver – stretch back only weeks earlier to incorporation in Vancouver on July 17.
The sole director was Graeme Wilkie. Busy Beavers later also listed Don Jones as executive director.
Both men, along with Paul Graham, are directors and sole shareholders of Busy Beavers Investments Pty Ltd.
Busy Beavers Investments’ address in Brisbane’s industrial suburb of Murarrie is the same as some ABC facilities. It was also once ABC’s registered office.
Gold Coast-based Jones declined to be interviewed. But in an email he wrote Canadian media speculation was mostly “inaccurate, biased . . . instigated by vested interests”.
Jones says he has checked child care opportunities globally over a decade and sees a shortage.
“We see opportunities in Canada as it appears to be on par with Australia 15 years ago in many aspects.
“We see an opportunity to provide the families of Canada choice, improved safety and educational standard.”
Jones maintained Busy Beavers had “no links” to ABC.
Before Canada, Jones’s ABC ties were already known.
Citigroup analysts last year pointed out he was a director of ABC Acquisitions, which co-ordinates Australian centre developers and sellers for ABC Learning.
While then based at the same address as ABC Learning headquarters, Acquisitions was designated a separate entity. It listed two shareholders – Mr Jones and a Heather Jones.
Citigroup said they believed the “arm’s-length arrangement” with Acquisitions was to enable a child care licence “to be categorised as an asset” on ABC Learning’s balance sheet.
But ABC Learning, whose accounts Groves describes as transparent but which have raised eyebrows from some watchers, rejected that claim.
The relationship strengthened on February 14 this year when ABC Learning provided a mortgage-secured and registered $50 million loan to Acquisitions.
Groves says this was provided (and was not the first such deal) because ABC Learning needs many centres built but developers require funding.
“They (developers) go and get individual funding from banks and then they need equity to support that funding, so that’s the money that we help them get through with,” he says.
It is among assets in ABC’s balance sheet, he says.
Acquisitions in July changed its name to 123 Global to “reflect the truly global nature” of operations with clients including Canada’s Busy Beavers.
The Busy Beavers move sparked several theories.
One is Busy Beavers was working for ABC – rejected by both parties – to get centres cheaper as ABC’s presence would boost prices.
Another is Busy Beavers hopes to get a foothold and later sell to ABC. A third is Busy Beavers just sees an opportunity.
Some question whether Jones’s move with Busy Beavers would imperil lucrative Australian ABC ties.
Groves rejects this. “He’s not competing with us,” Groves says.
The ties between organisations extends to Busy Beavers’ national operations manager Marnie Testa, who left a similar role at ABC last year.
Canada’s Elson says Testa was among two Australians and an American she met at that first June meeting at 5pm.
“They were very familiar with (US and Australian) accreditation processes,” she says.
Elson says they were initially introduced as from Texas-based Adroit Investments, which has been making overtures about buying Canadian child care facilities.
Elson, who readily admits she might be judgmental against for-profit operators, says they “gave very short, abbreviated answers” about issues involving quality care and stockholders.
A second meeting in September was just with Testa, who Elson says elaborated on the upcoming Busy Beavers website.
Elson says she had an inkling by then of an ABC link and so asked how many children were at Australia’s ABC centres.
The response was “very brief”, Elson claims.
“(When) we asked for elaboration it was dismissed.”
The federal NDP’s Early Learning and Child Care Act passed second reading in the House of Commons by a vote of 144 to 116, on November 21.
Bill C303 will now go to committee review before being returned to Parliament for a third vote, possibly in February 2008.
The dedicated efforts of BCGEU members and allied child care supporters are paying off. The letters, emails, phone calls, and visits from citizens to their Members of Parliament — asking them to support this bill, have clearly been effective.
“Families are desperate for a quality public child care system that is affordable and accessible,” says BCGEU President George Heyman.
“Bill C303 offers the framework to build a universal system of child care, similar to the way health care is delivered in our country.”
Bill C303 will ensure accountability, quality, universality, and accessibility in child care. It will establish each of these as an official condition that provinces and territories must meet before any money can be transferred from the federal government for child care purposes.
This bill also helps protect non-profit delivery of child care. Any agency, including a for-profit agency, that currently provides early learning or child care services will continue to be eligible for funding. But no new for-profit agencies will be eligible for public funding under Bill C303.
“I commend everyone who has raised their voice through the national Code Blue and BC Child Care – Let’s Make It Happen! campaigns thus far,” says Heyman.
BCGEU members are urged to continue to let their elected representatives know that building an affordable, accessible, quality public child care system is a key priority for working families. If it clears third reading, the legislation must still be approved by Senate and proclaimed into law.
——
Hansard from House of Commons
Nov 20, 2007
Early Learning and Child Care Act – EXCERPTS [view full document]
The House proceeded to the consideration of Bill C-303, An Act to establish criteria and conditions in respect of funding for early learning and child care programs in order to ensure the quality, accessibility, universality and accountability of those programs, and to appoint a council to advise the Minister of Human Resources and Skills Development on matters relating to early learning and child care, as reported, with amendment, from the committee.
Ms. Denise Savoie (Victoria, NDP) moved that the bill, as amended, be concurred in.
The Acting Speaker (Mr. Andrew Scheer):
Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
(Motion agreed to)
Ms. Denise Savoie
moved that the bill be read the third time and passed.
The Acting Speaker (Mr. Andrew Scheer):
Because there was so much noise and there were people standing in the House, it was difficult for me to hear the members from the other end, so in fairness to all members and to ensure that those members have a voice when they desire to do so, I will call for the yeas and nays again and we are going to proceed from there.
Is it the pleasure of the House to adopt the motion?
Some hon. members: Agreed.
Some hon. members: No.
The Acting Speaker (Mr. Andrew Scheer): All those in favour of the motion will please say yea.
Some hon. members: Yea.
The Acting Speaker (Mr. Andrew Scheer): All those opposed will please say nay.
Some hon. members: Nay.
The Acting Speaker (Mr. Andrew Scheer): In my opinion the yeas have it.….
Ms. Denise Savoie (Victoria, NDP):
Mr. Speaker, the Conservative child care policy has failed working families. The Prime Minister talks about giving parents choice, but tens of thousands of parents are stuck on long wait lists. They watch fees rise out of reach or their local day care centres close because the centres cannot find or afford qualified staff. What choice do these parents have?
Working parents know the importance of quality child care for the healthy development of their children. What about their choice?
Today’s vote on my Bill C-303 is crucial. The bill would guarantee affordable, high quality early learning and child care that working families need and want and that Conservatives could not take away.
I ask all Canadians to join me in telling the Conservative government to stop restricting parents’ choices and standing in the way of our children’s futures.
The House resumed from November 20, consideration of the motion that Bill C-303, An Act to establish criteria and conditions in respect of funding for early learning and child care programs in order to ensure the quality, accessibility, universality and accountability of those programs, and to appoint a council to advise the Minister of Human Resources and Skills Development on matters relating to early learning and child care, as amended, be concurred in at report stage.
