New Brunswick: Free Daycare Funding Explained

New Brunswick's free daycare scheme is funded by a $544-million provincial-federal agreement, with the Government of Canada providing almost $492 million in federal funding over five years, and New Brunswick contributing an additional $53 million. The scheme is part of a Canada-wide early learning and childcare system, which aims to reduce fees for licensed childcare spaces by 50% on average by the end of 2022. In New Brunswick, this has resulted in a significant drop in out-of-pocket daycare costs for parents, with fees halving from June 1, 2022.

Federal and provincial funding

The Canadian government has committed to making life more affordable for families across the country. As part of this, it has invested £30 billion over five years to build a Canada-wide early learning and child care system in collaboration with provincial, territorial and Indigenous partners.

The Canada–New Brunswick Canada-wide Early Learning and Child Care Agreement provides almost £492 million in federal funding for New Brunswick over five years to help improve licensed early learning and child care for children under six years of age in the province. This is in addition to the more than £48.1 million in federal funding announced in August 2021 through the 2021–2022 to 2024–2025 Canada–New Brunswick Early Learning and Child Care Agreement, as well as close to £9.3 million through a one-time federal investment in the 2021 to 2022 fiscal year to support the early childhood workforce.

In addition to the federal contribution, New Brunswick will contribute an additional £53 million over the course of the Canada-wide agreement, which builds on the province’s current investments of £70 million in early learning and child care annually.

New Brunswick will create 3,400 new child care spaces within its early learning facility designation system by the end of March 2026, including 500 spaces by March 2023.

The province has also committed to the Day Care Assistance Program, which provides financial assistance to low-income families to support access to affordable, quality child care at a licensed early learning and childcare facility. Parents must apply for the program and payments are made directly to the licensed early learning and childcare facility. Eligibility is determined by the family’s need for childcare and their total net income.

The province also offers the Parent Subsidy program, which provides financial support to low and middle-income families and is based on a sliding scale (between £37,501 and £80,000) which considers child care fees, the number of children under the age of five not attending school and the total annual gross household income.

Day Care Assistance Program

The Day Care Assistance Program is a subsidy program offered by the Department of Social Development in New Brunswick, Canada. It is designed to help low-income families access affordable, quality childcare at approved daycare facilities. The program provides financial assistance to eligible families with children aged 0 to 12 years enrolled in a licensed early learning and childcare facility.

Eligibility for the program is determined by the family's need for childcare and their total net income. To be eligible, families must have an annual net income of $55,000 or less, with those earning $30,000 or less receiving a full subsidy, and those earning between $30,000 and $55,000 receiving a partial subsidy. The parents or guardians must also be working, attending school or a training program, undergoing medical treatment, or have a referral from a recognised source for their child to attend daycare.

The program does not cover the full cost of daycare; parents are responsible for paying any difference between the actual daycare cost and the approved subsidy amount. The maximum daily subsidy rates are $28.50 per full-time day for infants aged 0-23 months, $24.25 per full-time day for children aged 24 months to 12 years, and $12.75 per day for after-school care. High school students may be eligible for a higher subsidy rate of $27 per day for full-time childcare or $13.50 per day for part-time childcare.

The Day Care Assistance Program is part of a broader initiative by the Government of Canada to build a Canada-wide early learning and childcare system, with a goal of providing families with an average of $10-a-day childcare by 2026. The Government of Canada has committed $30 billion over five years towards this initiative, with additional funding provided by provincial and territorial partners.

Designated Centre – Parent Subsidy

The Designated Centre – Parent Subsidy program in New Brunswick provides financial support to low and middle-income families. The subsidy is based on a sliding scale between $37,501 and $80,000, factoring in child care fees, the number of children under the age of five who are not yet attending school, and the total annual gross household income.

Families with a total annual gross income of $37,500 or less will have access to free early learning and child care services at a designated New Brunswick Early Learning Centre. For families with multiple preschool children under the age of five, they will not pay more than 20% of their gross household annual income on childcare.

To be eligible for the Designated Centre – Parent Subsidy program, families must meet the following criteria:

• Have at least one preschool-aged child who is not in school and is registered in a Designated Facility.
• Be a resident of New Brunswick.
• Be working, in a training or education program, or have a special circumstance.
• Have a gross annual household income (before deductions) of $80,000 or less, or have expenses for childcare services that are more than 20% of the gross annual household income (before deductions).

The Designated Centre – Parent Subsidy Calculator helps families estimate their potential subsidy amount. However, it's important to note that the actual eligible subsidy amount will be confirmed by the Department of Education and Early Childhood Development during the application process.

Fee reductions

The Government of Canada has committed to making life more affordable for families across the country, and this includes providing support for early learning and child care. In collaboration with provincial, territorial, and Indigenous partners, the government has invested $30 billion over five years to build a Canada-wide early learning and child care system. This investment will help to ensure that all families have access to regulated early learning and child care for an average of $10 per day by March 2026, regardless of where they live.

As part of this initiative, the governments of Canada and New Brunswick have worked together to reduce child care fees for families in the province. Since June 1, 2022, licensed child care fees for New Brunswick families with children under six years of age have been reduced by an average of 50%. This means that families in New Brunswick are now saving approximately $3,900 annually per child in child care costs.

The fee reductions vary depending on the age of the child and the location of the daycare. For example, in small urban and rural areas, fees for infants have been reduced from $37.50 to $19 per day, while in large urban areas, fees for infants have been reduced from $41.30 to $21 per day. Similarly, fees for preschool-age children in small urban and rural areas have been reduced to $16 per day, and in urban areas, they have been reduced to $18 per day.

In addition to the federal contribution, the Province of New Brunswick is also committed to making early learning and child care more affordable for families. The province has invested an additional $53 million over the course of the Canada-wide agreement, on top of their current investments of $70 million in early learning and child care annually.

New Brunswick also offers two subsidy programs to help working families with the cost of child care: the Designated Centre – Parent Subsidy and the Daycare Assistance Program. The Designated Centre – Parent Subsidy is available for children under the age of five, while the Daycare Assistance Program is for children attending school. These programs provide financial support to low and middle-income families, with the amount determined by a sliding scale that takes into account factors such as child care fees, the number of children, and the total annual gross household income.

Salary increases for educators

New Brunswick's free daycare scheme is funded through a combination of direct government subsidies to licensed daycare operators and parent fee subsidies. The government has also committed to increasing the salaries of early childhood educators, although this has been a source of controversy, as the increase only applies to those with a two-year college diploma or bachelor's degree in early childhood education or a related field. This has left many daycare operators feeling frustrated and angry, as they feel that the requirements for qualifying for the wage increase are too restrictive.

The province announced a 75-cent hourly wage increase for early childhood educators, intended to make these jobs more attractive and reduce staff turnover in daycare centers. However, this increase only applies to educators who have completed a two-year college diploma or a bachelor's degree in early childhood education or a related field. This restriction has been a source of controversy, with many daycare operators expressing frustration that most of their staff will not meet the requirements and, therefore, will not receive the increase.

The Department of Education and Early Childhood Development estimated that over 1,000 educators would qualify for the wage increase in 2019-2020. However, Early Childhood Care and Education New Brunswick, the association that represents the sector, disputed this, claiming that fewer than 500 of the 4,800 educators province-wide would see the increase. This discrepancy has further fueled the frustration of daycare operators, who feel that the government is not adequately supporting them or their staff.

The previous Brian Gallant government had pledged annual increases of 75 cents per hour for four years for educators with recognized training, which would have increased their hourly wage to $19 by 2023. However, the current Premier Blaine Higgs's Progressive Conservative government has not committed to continuing these increases beyond the initial 75-cent top-up, which brings the minimum hourly wage for trained educators to $17.25 when combined with the minimum wage increase.

The controversy over the wage increase is further exacerbated by the government's decision to cut funds for licensed childcare centers that facilitate the inclusion of children with special needs. This has left some daycare owners feeling betrayed and abandoned, as they had expected the government to provide additional support in line with the increased requirements for educator training.

Frequently asked questions