Yellowknife daycare issues ultimatum to GNWT over funding

One of the Northwest Territories’ largest daycares says it will drop out of the federal $10-a-day subsidy unless the GNWT provides “certainty” over funding.

In a March letter to the territory’s education minister, the Yellowknife Day Care Association said it will stop accepting the subsidy unless various financial guarantees are provided by April next year.

The federal subsidy has already halved many daycare fees in the NWT and aims to bring daycare costs down to $10 a day by 2026.

The subsidy works by transferring millions of dollars to the territorial government, which is then tasked with managing the detail of the program – how that financial support is rolled out, what the conditions are, and what happens if a childcare provider doesn’t sign up (or drops out).

So far, the process has been rocky. Operators of daycares and day homes have complained that the GNWT implemented the program in a rush, leading to outcomes that some providers felt were not fair or practical.

More recently, some operators have said they don’t see how the new system is going to meet two of its biggest goals – raising incomes for childcare workers while reducing fees for parents.

In theory, government money fills the gap. But the Yellowknife Day Care Association, or YKDA, says the GNWT’s approach leaves it unconvinced that the territory’s proposed means of providing that money will work.

A key concern is that the GNWT’s system caps annual fee increases for any operator receiving the subsidy. That cap exists to make hitting the $10-a-day target easier, but providers who feel they need to hike fees significantly to make ends meet won’t be able to do so – unless the territorial government agrees.

That’s important, because the territory’s next step is to introduce a wage grid that mandates how much staff in the sector should be paid. When that happens, alongside losing some control over their fees, operators will also lose some decision-making over the salaries they pay.

YKDA argues that the funding currently provided by the GNWT isn’t enough to run programs to the daycare’s desired level. In its March 17 letter, YKDA expressed concern that territorial funding already does not cover the number of staff the daycare believes it needs to provide adequate service, and that the new wage grid might be similarly funded below its expectations. (The daycare says it has taken its own steps to improve workers’ salaries and fears the GNWT-designed wage grid might not keep pace.)

The daycare also argues that funding provided must cover increases in operational costs like those driven by inflation.

The only alternatives, YKDA says, are to drop out of the subsidy – which the GNWT has made clear will mean an end to almost all financial supports, even the ones that were on offer prior to the subsidy being introduced – or let the GNWT completely take over the daycare, buying all of its assets.

The subsidy and the GNWT’s approach have “introduced uncertainty related to how, and whether, the YKDA will be able to carry out its operations in the manner that best supports the needs of the Yellowknife community,” the letter states.

“It is for this reason that the YKDA will have no choice but to make the difficult decision to no longer accept [the subsidy] effective April 1, 2024 unless the GNWT is able to provide the certainty requested.”

GNWT promises talks with operators

The Yellowknife Day Care Association is not the only provider in this position, according to a group that represents the NWT’s operators.

The NWT Early Childhood Association, in a letter of its own to education minister RJ Simpson later in March, said other providers “are not far behind” YKDA.

“First, we saw the family day homes struggling. Now, the operators of centre-based programs are being forced to consider closing their doors,” states the letter, signed by association chair Patricia Davison.

“This is a time for urgent action … The sector needs details on how the operational gaps are going to be met.”

Responding to both letters, the NWT’s Department of Education, Culture and Employment told Cabin Radio it was “still in very early stages” of developing the wage grid that it hopes to introduce in 2024.

“During the planning for the implementation of the wage grid, early childhood educators and licensed early learning and child programs will be engaged with and will have opportunities to provide feedback and ask questions along the way,” ECE spokesperson Erin Mohr said by email.

“ECE’s objective is to establish a territory-wide wage grid with linked funding that is equitable for all programs to benefit from this work and that supports sustainable programs in every community.

“All early childhood educators and licensed programs are encouraged to participate in those discussions and to contribute to this work.”

The department provided a graphic showing its intended timeline for the introduction of changes designed to support cheaper childcare in the NWT, including the wage grid’s rollout.

The department said it would talk to the NWT Early Childhood Association and other licensed programs about how a “new funding mechanism” should look – one that replaces what it called “the many existing streams currently in place.”

ECE declined YKDA’s offer to buy the daycare’s assets and operate the daycare itself, saying it has “no plans” to start owning or operating childcare ventures.

Asked what it could do before YKDA’s stated April 1, 2024 deadline, ECE said it would work with programs “to support sustainability throughout the system” and invite those involved to take part in discussions.

The Yellowknife Day Care Association stated that it hoped a year’s advance warning was enough time to address concerns so that the “drastic step” of leaving the subsidy would not be needed, “and the new financial support for the sector can reach the pockets of deserving parents and staff.”