Tories to flip-flop on child care: Their $250 million will go directly to provinces
The Province
March 15, 2007
By: Norma Greenaway
Dateline: OTTAWA

OTTAWA -- The Tories have abandoned their plan to rely mostly on private enterprise to create 125,000 new child-care spaces over five years. Instead, the government will channel directly to provincial and territorial governments the $250 million a year it had originally earmarked for tax incentives and grants to businesses and other private organizations, CanWest News Service has learned.

The government's change of course will be outlined Monday in the federal budget.

The child-care money, which will be divvied up among the provinces and territories on a per-capita formula, will start flowing on April 1.

Prime Minister Stephen Harper announced on the day he was sworn in as prime minister last year that he would not honour the former Liberal government's child-care agreements with the provinces and territories beyond March 31 of this year.

The move meant the five-year agreements signed with the Paul Martin government, worth $5 billion, were cancelled after just two years, leaving the provinces and territories with $3.5 billion less than they had been banking on. The Conservatives promised to provide tax credits of up to $10,000 to employers or organizations for each child-care space created.

The bigger ticket for the Conservatives has been its universal child-care credit, a taxable $100 a month for each child under the age of six. It started going to parents last July.

Don Geisbrecht, president of the Canadian Child Care Federation, said many parents, now in the midst of filing tax returns, are belatedly realizing the $100 is a taxable benefit.

"To a lot of families this is coming as a shock," Geisbrecht said. "They are also coming to another realization. They've realized this [$100 a month] isn't choice in child care."