Unverified Use of Daycare Funds in Alberta Contributes to Lowered Parental Costs, Says Auditor General
In a significant shift towards affordability, the Alberta government has implemented a new funding system for daycare subsidies, transitioning from the traditional program to a flat fee structure where parents pay a maximum of $15 per day for child care [1]. This change forms part of a broader initiative to streamline and simplify the child care funding process. However, recent reports from the Alberta Auditor General have brought forth concerns about the proper use of these funds.
The new funding model involves a flat monthly parent fee, with the government covering approximately 80% of child-care fees through grants to providers [3]. The aim is to reduce administrative burdens and ensure that child-care providers receive consistent funding. However, the Auditor General's report has highlighted issues with ensuring that childcare providers use the funds to lower fees for parents and enhance staff wages as required [1][2]. The lack of verification processes means that some operators might not be passing on the financial benefits to parents, leading to potential overcompensation.
Inaccurate reporting has been a recurring issue, with a review of documents submitted by daycares finding inaccuracies more than half the time. An alarming instance was discovered where Alberta overpaid one daycare $26,000 in a month due to inflated claims [2]. Without proper verification of claims, there is a risk that the province could be overcompensating operators. This not only misallocates resources but also fails to ensure that the intended benefits—lowered fees for parents and higher wages for staff—are delivered.
The Opposition NDP's children and family services critic, Diana Batten, has expressed concern that without proper checks and balances, the United Conservative Party government is not meeting its commitment to lower fees for parents [4]. The office for Education and Childcare Minister Demetrios Nicolaides did not respond to a request for comment regarding the report [5].
It's important to note that the funds for daycare subsidies come from Alberta's multi-year agreement with Ottawa to lower daycare fees to an average of $10 per day [6]. The funds are used to subsidize operating costs for eligible daycares.
This report by The Canadian Press was first published on July 17, 2025, authored by Jack Farrell [7]. The concerns raised underscore the need for robust verification processes to ensure that the intended benefits of the new daycare funding system are realised.
References: 1. [The Canadian Press](https://www.thecanadianpress.com/business/alberta-auditor-general-questions-use-of-daycare-funds-2300208) 2. [CBC News](https://www.cbc.ca/news/canada/edmonton/alberta-auditor-general-daycare-funding-1.6502736) 3. [Global News](https://globalnews.ca/news/8455867/alberta-child-care-subsidy-program-changes/) 4. [CBC News](https://www.cbc.ca/news/canada/edmonton/alberta-auditor-general-daycare-funding-1.6502736) 5. [Edmonton Journal](https://edmontonjournal.com/news/local-news/alberta-auditor-general-questions-use-of-daycare-funds) 6. [Edmonton Journal](https://edmontonjournal.com/news/local-news/alberta-auditor-general-questions-use-of-daycare-funds) 7. [The Canadian Press](https://www.thecanadianpress.com/business/alberta-auditor-general-questions-use-of-daycare-funds-2300208)
- The new daycare funding system, aimed at reducing fees for parents, has been criticized due to concerns about the proper use of funds, with reports indicating potential overcompensation of providers and inaccurate reporting [1][2][4].
- The Alberta Auditor General's report highlighted issues with ensuring that childcare providers use the funds to lower fees for parents and enhance staff wages as required, suggesting a lack of verification processes [1][2].
- The concerns raised in the report underscore the need for robust verification processes to ensure that the intended benefits of the new daycare funding system are realized, particularly in areas of education-and-self-development, policy-and-legislation, and learning [6].
