Alberta entrepreneurs fear increased constraints under grant program for $10-a-day child care


A new grant program intended to bring child-care costs in Alberta down to $10 per day by 2026 is raising flags for the owners of some for-profit child-care centres, who worry the program allows too much government control of their private businesses. 

In Fort McMurray, Krystal Churcher said she felt like her hands were tied when the province came to her with a contract for the child-care grant. 

While affordable child care is great for families, the owner of Early Start Learning Centre wondered if the grant would limit her as an owner.

Months later, Churcher says that’s exactly what happened.

The grant program grandfathered in existing private child-care centres and added 2,700 additional eligible spots, according to Andrew Reith, press secretary for Matt Jones, the minister of children’s services.

Now that Churcher has signed onto the agreement, students at her centre are under the grant program.

However, if she were to expand or open a second location, new students would not be.  That means that her new spaces or new business would be at a large financial disadvantage and likely wouldn’t be viable. 

“It reduces the value in my business,” Churcher said. 

Krystal Churcher runs the private Early Start Learning Centre preschool in Fort McMurray, Alta. (Submitted by Krystal Churcher)

But without the grant’s wage top-up, she wouldn’t be able to have a competitive wage for her staff, because most other child-care facilities have signed onto the agreement. 

“I don’t know of another sector in Alberta where private small business owners are being restricted and shackled like this,” said Churcher. 

Before signing on to the agreement, Churcher was looking at expanding her business to a second location. A few weeks ago she pulled the plug, saying the financial risk is too big.

Currently, United Conservative Party candidates are vying to lead the party and Churcher said she’d like to see candidates fighting for child-care entrepreneurs.

In an email, Reith said the federal government was clear that not-for-profit care would be prioritized, but noted that private centres make up the 67 per cent of licenced child-care spaces in Alberta. “Alberta’s government will continue to fight for the expansion and inclusion of private entrepreneurs,” he said in the email. 

Once a cost control framework for for-profits is developed, newly licenced programs will be able to become part of the funding program, said Reith.

Currently the province is working with the federal government to develop a private expansion plan and a cost control framework in order to add more private spaces to the program, wrote Reith. 

But that framework is troubling to Kathryn Babowal, director of Les Petits Soleils in Calgary.

A screenshot of the presentation given to business owners about a proposed cost control framework. Kathryn Babowal is concerned that if wage and revenue caps are put into place, her business will turn into a non-profit. (Submitted by Kathryn Babowal)

She recently joined a group of child-care entrepreneurs in Alberta after becoming frustrated with the provincial government’s grant program. 

“We are super excited for parents to have opportunities to have affordable childcare,” said Babowal.

But that shouldn’t have to mean losing control of her business.

In May, the province asked operators of for-profit child-care centres for feedback on a cost control framework. The framework included a potential wage cap and revenue cap in the upcoming grant application process for 2023. The current agreement already includes a three-per-cent cost increase cap on businesses. 

“They’re basically intending to restrict us to become not-for-profit centres,” said Babowal. 

She said the private industry is good for parents and kids. “Competition drives quality,” she said.

Kathryn Babowal, owner of Les Petits Soleils Inc., is concerned that the government will have too much say in her business with a cost control framework. (Submitted by Kathryn Babowal)

In the email, Reith said the province heard a lot of concerns about the framework from operators and “there will be ongoing communication and collaboration with operators and parents.” 

Shannon McKenzie, owner of PuddleDucks Preschool, said also has concerns with how the grant program affects her autonomy.

PuddleDucks Preschool is a costly program that helps children with higher needs. 

This year she wanted to increase her fees but she had to get special permission from the government, as the contract stipulates she can’t increase her cost by more than three per cent. McKenzie ended up getting approved for a six per cent increase, which she says is still below inflation.

“I would like to have more flexibility about increases,” said McKenzie, who wants to ensure staff — including herself — are able to earn a living wage.

She earned $27,000 last year, she said.

The new grant contract with a cost control framework is expected to be completed by the end of the year.

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