Canada-Quebec - 2021 to 2026 Asymmetrical Agreement on the Canada-Wide Early Learning and Child Care Component

Official title: 2021 to 2026 Asymmetrical Agreement on the Canada-Wide Early Learning and Child Care Component

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Canada-Quebec - 2021 to 2026 Asymmetrical Agreement on the Canada-Wide Early Learning and Child Care Component

Between:

Referred to individually as the "Party" and collectively hereinafter referred to as the "Parties".

Preamble

Whereas, the Department of Employment and Social Development Act authorizes the federal Minister to enter into agreements with the provinces and territories, for the purpose of facilitating the formulation, coordination and implementation of any program or policy within the mandate of the Department of Employment and Social Development Act.

Whereas, the Government of Canada has established an early learning and child care framework with the provinces and territories, with the exception of Quebec.

Whereas, Canada confirmed in Budget 2021 an investment of nearly $30 billion over 5 years and provides ongoing funding to work with provincial, territorial and Indigenous partners to support quality not-for-profit child care, and to ensure that early childhood educators are at the heart of the system. Combined with previous investments announced since 2015, $9.2 billion per year will be invested in child care, including Indigenous youth learning and child care, starting in fiscal year 2025 to 2026.

Whereas, for years subsequent to fiscal year 2025 to 2026, Canada has committed to provide financial support to the provinces and territories.

Whereas, the field of early learning and child care falls under the exclusive jurisdiction of Quebec and Canada recognizes that the allocation of its funding must comply with this exclusive jurisdiction.

Whereas, Quebec expects that its fair share of any sum related to early learning and child care will be transferred asymmetrically by the federal government.

Whereas, Quebec has its own early learning and child care system since 1997 with a reduced parental contribution for which it reports to its population.

Whereas, Canada's objectives are in line with those already put forward by Quebec in its early learning and child care system.

Whereas, Quebec is already making significant investments in this area and will continue to offer child care services to its population, including the English-speaking community.

Whereas, Canada, the Assembly of First Nations, Inuit Tapiriit Kanatami and the Métis National Council jointly released the co-developed Indigenous Early Learning and Child Care Framework in September 2018. This framework sets out broad principles and a vision for Indigenous families and children.

Whereas, Quebec’s child care program is available on Indigenous reserves.

Whereas, Canada therefore proposed in Budget 2021 to put in place an asymmetric agreement with Quebec that will allow it to make further improvements to its system, which the people of Quebec are rightly proud of.

Now therefore, Canada and Quebec agree as follows.

1.0 Definition

The following expression used in the agreement will have the scope defined below:

2.0 Period of the agreement

The Agreement will take effect upon the last signature being affixed and will remain in effect until March 31, 2026, unless terminated in writing by Canada or Quebec in accordance with the terms hereof in section 9. Funding provided under this Agreement, in accordance with section 3, will cover the period from April 1, 2021 to March 31, 2026.

The Parties agree that, for the period subsequent to that covered by this Agreement, the Agreement will be renewed by mutual agreement of both Parties.

3.0 Contribution

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 fixed base rate of $2 million per year for each province and territory and the balance of the funding on a per child (0 to 12) basis for the period starting on April 1, 2021 and ending on March 31, 2026. This funding is for financial commitments made as part of the 2021 to 2022 to 2025 to 2026 Canada-wide Early Learning and Child Care Agreements.

  1. $2,948,082,433 for the fiscal year beginning April 1, 2021
  2. $4,489,349,839 for the fiscal year beginning April 1, 2022
  3. $5,538,345,183 for the fiscal year beginning April 1, 2023
  4. $6,492,201,954 for the fiscal year beginning April 1, 2024
  5. $7,718,943,823 for the fiscal year beginning April 1, 2025

The final amount to be paid to Quebec for the fiscal year will be calculated by multiplying the total amount of federal funding paid for that fiscal year as listed above (minus the fixed base rate of $2 million for each province and territory) by the quotient obtained by dividing the population of children, aged 0 to 12, of Quebec during that fiscal year, by the total population of children, aged 0 to 12, of all provinces and territories during that fiscal year, to which the fixed base rate of $2 million will be added.

For the purposes of this calculation, the population of children, aged 0 to 12, in Quebec for a fiscal year and the population of children, aged 0 to 12, in all provinces and territories will be determined on the basis on the official estimates produced by Statistics Canada on July 1 of that fiscal year. These estimates are released by Statistics Canada in September of each fiscal year. The final annual amount will be determined by Canada and communicated to Quebec on or about October 15 of each fiscal year.

4.0 Payment of the contribution

Subject to the annual adjustment based on the formula described in section 3, the estimated amount of the contribution to be paid by Canada to Quebec will be:

Table 1: Quebec’s estimated share of funding amounts by fiscal year
Fiscal year Estimated amount of Canada's contribution to Quebec*
2021 to 2022 $660,445,535
2022 to 2023 $991,722,477
2023 to 2024 $1,216,997,313
2024 to 2025 $1,418,564,861
2025 to 2026 $1,675,806,897

*Amounts represent annual estimates based on Statistics Canada's population estimates

In fiscal year 2021 to 2022, the first installment will be paid within 60 days after the signatures from both Parties are affixed to the Agreement. The second installment will be paid on or about November 15.

Beginning in fiscal year 2022 to 2023, the first installment will be paid on or about June 15 of each fiscal year. The second installment will be paid on or about November 15 of each fiscal year. The sum of the 2 semi-annual installments constitutes a final payment and is not subject to any further adjustment once the second installment of that fiscal year has been paid.

All payments made by Canada under this Agreement are subject to an annual appropriation by the Parliament of Canada for the fiscal year during which the payment must be made.

Quebec shall reimburse Canada for any amounts paid that exceed the amount to which it is entitled under this Agreement. Such a debt is a debt due to Canada and must be repaid quickly after the receipt of a written notice of a claim for repayment.

The contributions made pursuant to this Agreement are in addition to and not in lieu of those Canada currently pays to Quebec through the Canada Social Transfer (CST) and the Asymmetric Agreement Implementation Agreement of March 10, 2017 (early learning and child care component).

5.0 Use of contribution funds

As Quebec has been funding its own early learning and child care system of centres de la petite enfance since 1997 (a portrait of the Quebec system is presented in Annex 1), Quebec intends to use a significant portion of the contributions made under this agreement to fund further improvements to its early learning and child care system, including those identified by Quebec as an example in Annex 2.

6.0 Reporting and information sharing

Quebec will provide Canada with public reports about its educational child care system. These reports include objectives and indicators produced by Quebec and are associated with Quebec's educational child care system. Quebec agrees to allow Canada to distribute them and make them available to other provincial and territorial governments.

For a number of years, Quebec has been sharing its information, expertise and best practices with respect to early childhood development, including early learning and child care, with other governments in Canada and it intends to continue this practice, which will contribute to the development of comparable indicators.

7.0 Communications

Canada and Quebec recognize the importance of ensuring that the public is informed of Canada's annual financial contributions to Quebec under this Agreement. To this end, Quebec agrees to recognize these contributions in public reports on its early learning and child care system.

Canada and Quebec agree to participate in a joint announcement upon signing of this Agreement.

In addition, Canada and Quebec also agree to participate annually in a joint announcement at the ministerial level to confirm the amounts of funding under this asymmetrical agreement.

8.0 Dispute resolution

Canada and Quebec are committed to working together and avoiding disputes through government-to-government information exchange, advance notice, early consultation, and discussion, clarification and resolution of issues as they arise.

Should a dispute between the Parties arise with respect to the interpretation and/or implementation of any of the terms and conditions of this Agreement, either Party may notify the other, in writing, of its concerns. Upon receipt of such notice, Canada and Quebec will endeavour to resolve the issue in dispute in a manner that is deemed appropriate by the designated officials.

In the event a dispute cannot be resolved by designated officials, the issue may be referred, in the first instance, to the federal Deputy Minister of Employment and Social Development and the Quebec Deputy Minister of Families and, in the second instance, to the federal Minister of Families, Children and Social Development and the Quebec Minister of Families.

9.0 Amendments to the agreement

This Agreement may be amended at any time if the Parties mutually agree to do so in writing. Any amendments will enter into effect on the date agreed to by the Parties. Neither Canada nor Quebec may terminate this Agreement unless it is demonstrated that the Agreement is not being honoured by the other Party. That Party must provide the other Party with at least 12 months’ written notice of its intention to terminate the Agreement.

10.0 Waiver

Failure by any Party to exercise any of its rights, powers, or remedies under this Agreement or its delay to do so does not constitute a waiver of those rights, powers, or remedies. Any waiver by either Party of any of its rights, powers, or remedies under this Agreement must be in writing; and, such a waiver does not constitute a continuing waiver unless explicitly stated.

11.0 General

This Agreement shall be interpreted in accordance with the laws in force in Quebec.

Canada will make public the entire Agreement by posting it on the Government of Canada website.

No member of the House of Commons or the Senate of Canada or of the National Assembly of Quebec shall be admitted to any share or part of any contract, agreement or commission made pursuant to this Agreement, or to any benefit arising therefrom.

If, for any reason, a provision of this Agreement that is not a fundamental term is found to be invalid or unenforceable, in whole or in part, it will be deemed to be severable and will be deleted from this Agreement, but all the other provisions of this Agreement will continue to be valid and enforceable.

12.0 Notice

Any notice, information or document provided for under this Agreement will be effectively given if delivered or sent by letter, postage or other charges prepaid.

Any notice that is delivered will be deemed to have been received on delivery and, except in periods of postal disruption, any notice mailed will be deemed to have been received 8 calendar days after being mailed.

The address for notice or communication to Canada shall be:

Social Policy Directorate
140, promenade du Portage
Gatineau QC  K1A 0J9
NC-SSP-ELCC-GD@hrsdc-rhdcc.gc.ca

The address for notice or communication to Quebec shall be:

Secretary General
Ministry of Families
425, rue Jacques Parizeau
Québec QC  G1R 4Z1

Signatures

The agreement is signed on behalf of Canada by the Deputy Prime Minister and Minister of Finance, the Minister of Families, Children and Social Development, and on behalf of the Government of Quebec by the Minister of Finance, the Minister of Families and the Minister responsible for Canadian Relations and the Canadian Francophonie. It may be signed in several copies.

Signed on behalf of Canada by the Deputy Prime Minister and Minister of Finance this 30 day of July, 2021.

[Signed by] The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance.

Signed on behalf of Quebec by the Minister of Finance this 4 day of August, 2021.

[Signed by] Eric Girard, Minister of Finance.

Signed on behalf of Canada by the Minister of Families, Children and Social Development this 4 day of August, 2021.

[Signed by] The Honourable Ahmed Hussen, Minister of Families, Children and Social Development.

Signed on behalf of Quebec by the Minister of Families this 5 day of August, 2021.

[Signed by] Mathieu Lacombe, Minister of Families.

Signed on behalf of Quebec by the Minister responsible for Canadian Relations and the Canadian Francophonie this 6 day of August, 2021.

[Signed by] Sonia LeBel, Minister responsible for Canadian Relations and the Canadian Francophonie.

Annex 1: Portrait of Quebec’s system of educational child care services (2021)

Quebec already has a system of quality educational child care services and a reduced-contribution spaces program.

Quebec is considered a leader in early learning and child care. To offer affordable child care services, Quebec has implemented a reduced-contribution space program that has proven its worth (created in 1997).

Quebec also has the highest proportion of children in child care. In 2019, 78.2% of children under the age of 6 had access to formal and informal child care.

As of March 31, 2021, the Quebec system had more than 307,000 licensed child care spaces, including more than 237,000 reduced-contribution child care spaces.

In Quebec, the reduced-contribution space program allows parents to benefit from a rate of only $8.50 per day (in 2021) to attend child care, which is below the federal government's target of $10 per day.

A significant financial contribution from the Government of Quebec

In fiscal year 2021 to 2022, the Government of Quebec will allocate more than $2.7 billion to child care services through the Educational Childcare Services Fund (an increase of 8.5% compared to 2018 to 2019). In addition to the reduced basic parental contribution, total funding for child care will be close to $3.2 billion.

In fiscal year 2021 to 2022, the proportion financed by the parental contribution will correspond to 13.9%. Since fiscal year 2019 to 2020, this proportion is lower since the additional contribution for reduced-contribution child care was abolished on January 1, 2019.

In addition, in order to support parents of children attending unsubsidized child care services, the Government of Quebec provides tax assistance through the refundable tax credit for child care expenses, which makes it possible to reduce the gap between the rate offered in subsidized and non-subsidized child care services. For the 2021 tax year, the refundable child care expense tax credit is expected to cost $748.2 million.

Annex 2 – Quebec’s child care priorities

Future development of the system

Over the next few years, the Government of Quebec will continue to invest significantly in programs and services for families and children.

Thus, the Government of Quebec wishes to increase the number of subsidized spaces with reduced contribution by more than 30,000.

These important upcoming investments, which will receive significant federal funding, will be in addition to several initiatives already announced, including strengthening the existing network.

Strengthen the current system

In order to strengthen the current system, the Government of Quebec announced, as part of its fiscal year 2021 to 2022 budget, investments of $144.2 million over 5 years to:

Also, the ongoing renewal of the collective agreements of workers in CPEs will make it possible to improve their working conditions, in particular through wage increases.

Finally, investments of $89.3 million by fiscal year 2025 to 2026 have been included in the fiscal year 2021 to 2022 budget to improve school-based child care services. Through this investment, the Government of Quebec wishes to raise the level of services, in particular by reducing the ratio of educators to children in junior-kindergarten and by hiring special education technicians.

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