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Annex 4: Canada – New Brunswick Early Learning and Child Care Infrastructure Agreement for fiscal year 2023 to 2024 through 2025 to 2026

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Between:

  • His Majesty the King in Right of Canada (hereinafter referred to as “Canada” or “Government of Canada”) as represented by the Minister of Employment and Social Development (“Canada”) and as represented by the Minister of Families, Children and Social Development (herein referred to as “the federal Minister”), and
  • the Government of New Brunswick (hereinafter referred to as “New Brunswick”) as represented by the Minister of Education and Early Childhood Development (herein referred to as “the New Brunswick Minister”)

Referred to collectively as the “Parties”.

Preamble

Whereas, the Parties concluded the Canada-New Brunswick Canada-wide Early Learning and Child Care (ELCC) Agreement (“Canada-wide Agreement”) on December 12, 2021.

Whereas, Canada and New Brunswick agree upon the importance of infrastructure investments that increase inclusion in ELCC so that all families in Canada have access to affordable, high quality, flexible and inclusive licensed ELCC no matter where they live.

Whereas, Canada and New Brunswick have agreed to increase inclusion in the Canada-wide ELCC system by supporting equitable access to licensed and designated child care spaces for children and families with barriers to access such as children with disabilities and children needing enhanced or individual supports, Indigenous children, Black and other racialized children, children of newcomers and official language minority communities.

Whereas, the Multilateral ELCC Framework recognizes the importance of inclusive ELCC systems that respect and value diversity for children and families with barriers to access and for children with varying abilities.

Whereas, in response to requests from provinces and territories, and to support the implementation of the Canada-wide ELCC system, Budget 2022 proposes to provide $625 million over four years, beginning in 2023 to 2024, for an ELCC Infrastructure Fund. The ELCC Infrastructure Fund will exclusively support not-for-profit, designated and publicly regulated ELCC providers in recognition of the specific challenges they face in financing capital costs.

Now therefore, the Parties agree as follows.

1.0 Purpose

1.1 Canada and New Brunswick agree that for fiscal years 2023 to 2024 through 2025 to 2026, financial support from Canada to New Brunswick will be used to support infrastructure projects that increase inclusion in ELCC for underserved communities. In alignment with the period of this Annex in section 3.0, the first three years of infrastructure funding (2023 to 2024 through 2025 to 2026) will be provided through this Annex. Subject to Parliamentary approval of appropriations, funding for fiscal year 2026 to 2027 will be provided subject to an extension of this Annex and conditional on Canada’s acceptance of a new ELCC Infrastructure Action Plan and informed by Canada’s assessment of the results achieved under the action plan set out in Schedule 1.

1.2 In this Annex, “fiscal year” means the period commencing on April 1 of any calendar year and terminating on March 31 of the immediately following calendar year.

2.0 Areas of focus

2.1 New Brunswick agrees to use funds provided by Canada under this Annex to support exclusively licenced, designated, not-for-profit or public ELCC providers as defined in section 2.2.1 of the Canada-wide Agreement.

2.2 New Brunswick agrees to use funding to support infrastructure projects that increase inclusion in ELCC for underserved communities, including through major and minor capital projects, including funding for the purchase of infrastructure. Activities that support the objective of increasing inclusion in ELCC for underserved communities include but are not limited to: planning, design, acquiring real estate, construction and renovations. They also include start-up costs for infrastructure projects such as business plans and feasibility studies.

2.3 Expenses that do not directly support the objectives and initiatives of the ELCC Infrastructure Fund, such as operations and maintenance, are ineligible.

2.4 Subject to 4.1.2 b) of this Annex, New Brunswick agrees to use funding to support ELCC spaces in underserved communities including but not limited to: rural and remote regions, high-cost urban/low-income areas and communities with barriers to access (racialized; Indigenous; newcomers; parents, caregivers and children with disabilities; official language minority communities, etc.). New Brunswick may also include infrastructure investments to increase the physical accessibility of ELCC spaces for children, parents, and staff with disabilities and physical infrastructure for ELCC operators providing care during non-standard hours, in recognition for the need for more flexible care for parents working in non-standard employment.

2.5 Subject to 4.1.2 b), of this Annex, New Brunswick may utilize funding to maintain existing inclusion infrastructure projects by using infrastructure funding to offset the increased cost of inclusive spaces already planned under the Canada-wide Agreement. New Brunswick may also create new inclusion infrastructure projects. For greater clarity, this would include but would not be limited to: reconsidering the location (for example, improve proximity to an underserved community) or features (for example, improve accessibility) of planned infrastructure investments; or, initiating new infrastructure investments to improve the inclusivity of existing spaces (for example, retrofits to improve the accessibility of existing spaces or upgrades to spaces in underserved communities).

3.0 Financial provisions

3.1 Allocation to New Brunswick

3.1.1 Subject to Parliamentary approval of appropriations, Canada has designated the following maximum amounts to be transferred in total to all provinces and territories under this initiative, with a three-step formula of 0.3% of the annual envelope allocated to each of the territories, a fixed base rate of $2 million per year for each province and territory, and the balance of the annual envelope calculated on a per child (0 to 12) basis for each province and territory.

  1. $75,000,000 for the fiscal year beginning on April 1, 2023
  2. $150,000,000 for the fiscal year beginning on April 1, 2024
  3. $200,000,000 for the fiscal year beginning on April 1, 2025

3.1.2 The New Brunswick funding allocations outlined in Table 1 may increase if another jurisdiction chooses not to sign onto the ELCC Infrastructure Funding for 2023 to 2024 through 2025 to 2026.

Table 1: Amount to be paid to New Brunswick (not subject to annual adjustment)
Fiscal year Amount to be paid to New Brunswick
2023 to 2024 $2,899,823.00
2024 to 2025 $4,283,773.00
2025 to 2026 $5,206,406.00

3.1.3 For the purposes of the formula in section 3.1 of this Annex, the population of children aged 0 to 12 is determined on the basis of the estimates of the respective populations on July 1 of 2022 updated in December 2022. ELCC Infrastructure Fund is not subject to an annual adjustment based on the latest population estimates.

3.2 Payment

3.2.1 Subject to Parliamentary approval of appropriations, Canada’s contribution will be paid in approximately equal semi-annual installments as follows:

  • New Brunswick’s fiscal year 2023 to 2024 allocation will be released in one installment within 60 days of Canada and New Brunswick’s approval of the 2024 to 2025 through 2025 to 2026 Action Plan. This Action Plan must be provided to Canada by New Brunswick in accordance with the requirements outlined in section 4.1 of this Annex
  • beginning in fiscal year 2024 to 2025, the first installment will be paid on or about June 15 of each fiscal year once Canada has agreed that New Brunswick has satisfied the Action Plan requirements in section 4.1 of this Annex; and the second installment will be paid on or about November 15 each fiscal year, once Canada has agreed that New Brunswick has satisfied the reporting conditions in section 5.2 of the Canada-wide Agreement and section 4.2 of this Annex

3.2.2 Subject to section 3.1.2 of this Annex, the sum of both the first installment and the second installment constitutes a final payment and is not subject to any further adjustment once both installments of that fiscal year have been paid, unless there is a debt due to Canada, which requires repayment in accordance with section 4.7 of the Canada-wide Agreement.

3.2.3 Payment of Canada’s funding for each fiscal year of this Annex is subject to an annual appropriation by the Parliament of Canada for this purpose.

3.2.4 For fiscal year 2023 to 2024, Canada may withhold payment of its annual installment for that fiscal year, if New Brunswick has failed to provide its Action Plan for 2024 to 2025 through 2025 to 2026 in accordance with section 4.1 which has been approved by Canada and may withhold future installments until this requirement has been satisfied.

3.2.5 In fiscal year 2024 to 2025, Canada may withhold payment of its first and second installments for that fiscal year if New Brunswick has failed to provide its annual Action Plan for 2024 to 2025 through 2025 to 2026 in accordance with section 4.1 which has been approved by Canada and may withhold future installments until this requirement has been satisfied.

3.2.6 In fiscal year 2024 to 2025, Canada may withhold payment of its second installment for that fiscal year and may withhold future installments until New Brunswick provides:

  • an annual progress report outlining data and results achieved from the previous fiscal year in accordance with section 5.2 of the Canada-wide Agreement and section 4.2 of this Annex; and
  • its unaudited financial statement of the previous fiscal year in accordance with section 5.2 of the Canada-wide Agreement and section 4.2 of this Annex

3.2.7 Starting in fiscal year 2025 to 2026, Canada may withhold payment of its second installment for that fiscal year and may withhold future installments until New Brunswick provides:

  • an annual progress report outlining data and results achieved from the previous fiscal year in accordance with section 5.2 of the Canada-wide Agreement and section 4.2 of this Annex; and
  • its annual audited financial statement of the previous fiscal year in accordance with section 5.2 of the Canada-wide Agreement and section 4.2 of this Annex

3.2.8 Starting in fiscal year 2024 to 2025, Canada may withhold amounts payable in respect of fiscal year if New Brunswick is unable to meet the objectives of this Annex, in accordance with section 2.0.

3.3 Carry Forward

3.3.1 In fiscal year 2023 to 2024, at the request of New Brunswick and subject to approval of Canada’s Treasury Board, New Brunswick may retain and carry forward to the following fiscal year any unexpended funds remaining from New Brunswick’s annual contribution payable under section 3.1 of this Annex, up to a maximum of 100% of the contribution payable. Any unexpended funds in excess of the maximum carry forward represents an overpayment subject to section 4.7 of the Canada-wide Agreement.

3.3.2 In fiscal year 2024 to 2025, at the request of New Brunswick and subject to approval of Canada’s Treasury Board, New Brunswick may retain and carry forward to the following fiscal year any unexpended funds remaining from New Brunswick’s annual contribution payable under section 3.1 of this Annex, up to a maximum of 10% of the contribution payable. Any unexpended funds in excess of the maximum carry forward represents an overpayment subject to section 4.7 of the Canada-wide Agreement.

3.3.3 In fiscal year 2025 to 2026, at the request of New Brunswick and subject to approval of Canada’s Treasury Board, New Brunswick may retain and carry forward to the following fiscal year any unexpended funds remaining from New Brunswick’s annual contribution payable under section 3.1 of this Annex, up to a maximum of 10% of the contribution payable. Any unexpended funds in excess of the maximum carry forward represents an overpayment subject to section 4.7 of the Canada-wide Agreement.

3.3.4 All amounts carried forward to the next fiscal year, pursuant to section 3.3.1 through 3.3.3 must be spent by the end of that fiscal year. New Brunswick is not entitled to retain any such carried forward amounts that remain unexpended after the end of that fiscal year, nor is it entitled to retain any balance of Canada’s contribution payable pursuant to section 3.1 that remains unexpended at the end of that fiscal year and is not carried forward in accordance with section 3.3.1 through 3.3.3. Such amounts are considered debts due to Canada and shall be repaid in accordance with section 4.7 of the Canada-wide Agreement.

3.4 Use of Funds

3.4.1 Canada and New Brunswick agree that funds provided under this Annex will only be used by New Brunswick in accordance with the areas for investment outlined in section 2.0 of this Annex.

3.4.2 Canada and New Brunswick agree that, within each fiscal year of the period of this Annex, New Brunswick may move funding between the individual programming categories that will be outlined in its ELCC Infrastructure Action Plan for 2024 to 2025 through 2025 to 2026 in Schedule 1 to ensure the maximum use of funding. New Brunswick agrees to notify Canada in writing of any such change in funding allocation, including the rationale for the change. The change will be implemented upon written agreement between Canada and New Brunswick.

3.4.3 Canada and New Brunswick agree that funds provided under this Annex will not displace existing provincial spending in place on or before March 31, 2021.

3.4.4 Canada and New Brunswick agree that funds provided under this Annex will not displace federal investments provided under the Canada-wide Agreement.

3.5 Maximum Annual Contribution in Respect of Administration Costs

3.5.1 In the fiscal years covered under this Annex, an amount up to 10% of the maximum amount payable for those fiscal years may be allocated towards administration costs.

4.0 Accountability

4.1 Action Plan

4.1.1 In fiscal year 2024 to 2025, New Brunswick commits to developing and providing its Action Plan for 2024 to 2025 through 2025 to 2026 that meets the federal requirements outlined in section 4.1.2 of this Annex, subject to approval by Canada.

4.1.2 In addition to the requirements outlined in the Canada-wide Agreement under section 5.1, for fiscal years 2023 to 2024 through 2025 to 2026, New Brunswick’s ELCC Infrastructure Action Plan for fiscal year 2024 to 2025 through 2025 to 2026 (Schedule 1) shall include the elements described in 4.1.2 (a) to (g) of this Annex. Once the Parties agree that the Action Plan is final, it may be published by one or both of the Parties. New Brunswick will publicly release their ELCC Infrastructure Action Plan which will include the following:

  1. specific priority areas for investment and objectives in supporting infrastructure projects that increase inclusion in ELCC
  2. demonstrate the need and demand for ELCC services that infrastructure funding will respond to in their ELCC Infrastructure Action Plan
  3. demonstrate that federal investments will be incremental, and will not displace existing provincial spending in support of ELCC infrastructure
  4. indicators that will be reported on according to New Brunswick’s planned investments in infrastructure
  5. specific targets for each indicator that will be reported on according to New Brunswick’s planned investments
  6. demonstrate how projects seeking to address physical accessibility specifically will meet accessibility standards; and
  7. demonstrate how funds provided by Canada under this Annex will assist New Brunswick in achieving existing space creation targets under the Canada-wide Agreement

4.1.3 New Brunswick will consult with parents, child care providers, experts, Indigenous peoples, official language minority communities and representatives from other groups with barriers to access (for example, rural/remote, low-income urban, racialized, newcomers, persons with disabilities, workers in non-standard employment) as an important step in implementing infrastructure projects that respond to the needs of underserved communities. New Brunswick will outline the results of consultations through its annual reports, per section 4.2.1 of this Annex.

4.2 Reporting

4.2.1 In addition to the requirements outlined in the Canada-wide Agreement under section 5.2, for fiscal years 2024 to 2025 through 2025 to 2026, New Brunswick agrees to:

  1. within 365 days of the end of the fiscal year report to the people of New Brunswick and to Canada on the results and expenditures to support infrastructure projects that increase inclusion for underserved communities. The report shall show separately the results attributable to the funding provided by Canada under this Annex
  2. by no later than October 1 of each fiscal year, provide to Canada additional information in the annual report for the previous fiscal year that shall show separately the results attributable to the funding provided by Canada under this Annex and shall include:
    1. a description of the activities, expenditures and results of this Annex as set out in the ELCC Infrastructure Action Plan for 2024 to 2025 through 2025 to 2026 (Schedule 1)
    2. results achieved according to the indicators and targets referred to in the ELCC Infrastructure Action Plan for 2024 to 2025 through 2025 to 2026 (Schedule 1)
    3. the number of infrastructure projects supported by the ELCC Infrastructure Fund and a description of how each project supported inclusion for an underserved community
    4. a description of results of each project achieved in increasing inclusion in ELCC
    5. a description of the results of any stakeholder consultations per section 4.1.3 of this Annex
  3. starting in fiscal year 2025 to 2026, by no later than October 1 of each fiscal year, provide to Canada an audited financial statement of revenues received from Canada under this Annex for each fiscal year from 2024 to 2025 through 2025 to 2026:
    1. the revenue section of the statement shall show the amount received from Canada under this Annex during the fiscal year
    2. the total expenditures under this Annex during the fiscal year
    3. if applicable, the administration costs incurred by New Brunswick as per section 3.5 of this Annex
    4. if applicable, the amount of any funds carried forward by New Brunswick under section 3.3 of this Annex
    5. if applicable, the amount of any surplus funds that are to be repaid to Canada under section 4.7 of the Canada-wide Agreement
  4. in fiscal year 2024 to 2025, by no later than October 1, provide to Canada an unaudited financial statement of revenues received from Canada under this Annex for fiscal year 2023 to 2024:
    1. the revenue section of the statement shall show the amount received from Canada under this Annex during the fiscal year
    2. the total expenditures under this Annex during the fiscal year
    3. if applicable, the amount of any funds carried forward by New Brunswick under section 3.3 of this Annex
    4. if applicable, the amount of any surplus funds that are to be repaid to Canada under section 4.7 of the Canada-wide Agreement

4.2.2 The financial statement shall be prepared in accordance with Canadian Generally Accepted Accounting Principles and the audit shall be performed by the New Brunswick Auditor General or his/her delegate, or by an independent public accounting firm registered under the laws of New Brunswick and shall be conducted in accordance with Canadian Generally Accepted Auditing Standards.

4.2.3 For those projects that take longer than the fiscal years covered by the ELCC Infrastructure Fund to complete, New Brunswick agrees to continue to provide Canada with annual reporting on these projects until completed, as per 4.2.1 of this Annex.

4.2.4 If any funding received under section 3.0 of this Annex is carried forward to fiscal year 2026 to 2027 in accordance with the carry forward provisions of section 3.0, the reporting obligations set out in this Annex that apply to funds provided under section 3.0 shall continue to apply in respect of that fiscal year in relation to the funds carried forward.

5.0 Communications

5.1 Canada and New Brunswick agree to participate in a joint announcement upon the signature of the amendment to append this Annex to the Canada-wide Agreement.

5.2 Canada reserves the right to conduct public communications, announcements, events, outreach and promotional activities about this Annex. Canada agrees to give New Brunswick 10 business days’ advance notice of public communications related to this Annex and the results of the investments of this Annex.

5.3 New Brunswick reserves the right to conduct public communications, announcements, events, outreach and promotional activities about this Annex. New Brunswick agrees to give Canada 10 business days’ advance notice and advance copies of public communications related to the Annex and results of the investments of this Annex. New Brunswick agrees to coordinate announcement dates with Canada to ensure attendance by both Parties.

5.4 Each of the Parties may request joint communications, defined as events, news releases, and signage that relate to the project(s) funded through this Annex, to communicate to Canadians about the progress or completion of the project(s) funded through this Annex. The requestor will provide at least 10 business days’ notice to the other Party. If the communications activity is an event, it will take place at a mutually agreed date and location.

5.5 The requestor of the joint communications will provide an equal opportunity for the other Party to participate and choose their own designated representative (in the case of an event).

6.0 General

6.1 All other terms and conditions of the Canada-wide Agreement apply to this Annex, except where outlined in this Annex.

6.2 This amending Annex shall be read in conjunction with the Canada-wide Agreement and shall take effect as if its provisions were an integral part of the Canada-wide Agreement.

6.3 To the extent there is a conflict, the terms and conditions of this Annex prevail.

6.4 Where there is a dispute concerning the application of a provision of the Canada-wide Agreement to this Annex, the parties shall use the Dispute Resolution provisions of the Canada-wide Agreement to resolve the dispute.

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