January 29, 2007

Changes To Eligibility For Child Care Fee Subsidies

What is different?

• Until December 31, 2006 eligibility for a child care fee subsidy was through a needs-based test. This required the ongoing evaluation of several documents such as household receipts and bank statements.
• As of July 26, 2007, the new test to determine eligibility:
  • is based only on net family income
  • will be easier for families to apply for and for municipalities to administer
  • will provide a consistent way to determine eligibility
  • means more families across a range of incomes could receive a fee subsidy and reduce their child care cost

What is net income?

For the purposes of determining eligibility for child care fee subsidies, net income is defined as:

• The net income amount on line 236 of the Canada Revenue Agency personal income tax form minus any federal Universal Child Care Benefit (UCCB) payments.  The UCCB is not considered in determining a family's child care fee subsidy.

What kind of documents will parents need to bring to verify income?

Parents will need to bring their most recent Canada Child Tax Benefit Notice.  Parents who did not receive any UCCB payments may bring their most recent Notice of Assessment instead.

When will this become effective?

Municipalities are required to begin the income-testing method of determining eligibility for child care fee subsidies as of January 1st, 2007. Families currently receiving a fee subsidy will be income-tested at their next review.

Who is eligible for fee subsidies?

Families with children in licensed child care may be eligible for child care fee subsidies.

Does this affect child care costs for Ontario Works or the Ontario Disability Support Program recipients?

No. Ontario Works and Ontario Disability Support Program recipients will remain eligible for a full fee subsidy.

Will any family pay more for child care under the income test compared to what they were paying under the needs test?

• A grandparenting strategy has been included so that parents with young children currently receiving a fee subsidy would not be required to pay more for that child’s care. 
• These parents would continue to pay no more than their current level of child care fees until that child enters Grade 1.

How much can families now expect to pay for child care?

• Child care costs for subsidized families will be based on net family income.
• Families who currently receive fee subsidies will continue to do so under the new system.
• Assuming an average daily child care fee of $43, the following chart shows what a family receiving a fee subsidy would pay for child care under the income test.  No family would pay more than the total cost of child care.

Net Family Income	New daily child care fee for licensed child care for subsidized families As of January 1 st, 2007 (Rounded to the nearest dollar)
$20,000	$0
$30,000	$4
$40,000	$8
$50,000	$19
$60,000	$31
$70,000	$42

How can families find out if they are eligible for a child care fee subsidy?

Child care is delivered locally through the municipalities. Parents can contact their local municipal office to discuss their eligibility for a child care fee subsidy and to determine whether there are changes to their child care costs.

Additional Information:

• News Release