The Ontario government announced a new formula for funding private childcare centers, in order to comply with the federal program providing $10 a day childcare.

Education Minister Todd Smith is expected to announce a new funding formula

He stated that he believes the new formula will prevent closures and provide childcare centers with certainty and financial stability.

Todd Smith said that based on the feedback and consultation that was conducted regarding the new funding formula, we are very comfortable, as those who are working and those who want to work will be able to do so in the province, creating these much-needed spaces that families are looking for.

The new funding, expected to take effect at the beginning of January, comes with the announcement that as of the same day, the fees paid by parents will be further reduced.

They have already decreased by about 50% to an average of $23 a day, and next year they will drop to an average of $19, with a maximum of $22.

It will further decrease to an average of $10 a day by March 2026, a date that has been postponed from September 2025.

Smith said that under the new funding, centers will have more flexibility regarding their expenditures, which will enable some to increase staff wages.

The government currently covers the amount of money that parents provide through the reduced fees, but centers say that simply replacing revenues based on fees that were frozen in 2022 does not account for the true cost of providing care.

It is worth noting that officials said the new funding formula will include a provision so that no center in the $10-a-day program will incur losses.