Toronto handed out 7,700 fewer child-care subsidies than it had planned to in 2025, city budget documents show, while the waitlist for subsidized spaces reached 16,020 children.
City officials say affordability measures have pushed demand higher than the pace of new space creation, creating a bottleneck that prevents eligible families from actually using subsidies even when funding is available.
How the subsidy system works
Toronto’s children’s services division administers fee subsidies on behalf of the provincial government, which sets the program rules. The subsidies come on top of Canada’s national child-care program, which currently targets rates of $22 a day. Depending on household income, a fee subsidy can reduce the cost to $22 a day, $12 a day, or zero.
The numbers behind the shortfall
The city had planned to offer 30,700 subsidies last year but delivered about 23,000. Toronto currently reports 82,340 child-care spaces in total, and says thousands of additional spaces are in development.
When you make something affordable, demand increases. Hence, that’s what happened here in Toronto and across the province. As child care is more affordable, the demand increases. We have families waiting for fee subsidies, we have fee subsidies available, but the biggest constraint is spaces.
Shanley McNamee, general manager, Toronto children’s services
Why fewer subsidies were granted
A subsidy is tied to a physical spot. If an eligible child cannot find a centre with an open placement, the subsidy cannot be used and will not be issued. That dynamic helps explain why the number of subsidies handed out fell even as affordability improved.
As parent fees for (Canada-Wide Early Learning and Child Care) have decreased and demand from families has increased, it has become more difficult for all families, including those who are eligible for the fee subsidy, to enroll in the program.
Office of the Auditor General of Ontario
City and provincial response
Toronto officials say the city is planning to bring more physical child-care locations online and has pressed the province for additional support and greater flexibility in subsidy and capital plans. The city emphasises that total child-care funding will continue at projected rates.
A spokesperson for the education minister said the province will work with municipal partners and has increased funding for the Every Child Belongs program, adding that municipalities are given flexibility to prioritise parts of the subsidy program.
The thing that we’re still waiting for in (children’s services) is the capital infusion coming from the other orders of government.
Shelley Carroll, Toronto budget chief
What this means for families
For families, the shortage of physical spaces means longer waits even when a household qualifies for lower fees. The city expects incremental improvement as new sites open, but officials note that growth takes time and can take one to three years to catch up with rising demand.
- Planned subsidies for 2025: 30,700
- Subsidies actually offered: about 23,000
- Waitlist for subsidy spaces: 16,020 children
- Total child-care spaces in Toronto: 82,340
- New spaces in development: described by the city as "thousands"
Officials say continued capital investment from the province and federal partners will be the critical factor in reducing the bottleneck and allowing subsidy funding to translate into actual care placements.
Toronto will keep distributing subsidies within the constraints of existing spaces while working with provincial partners to speed up site openings and adjust subsidy rules where possible. City leaders expect modest relief over the next 12 months, but a full catch-up will take longer.
