2024 CWELCC Funding

Ministry of Education
Early Years and Child Care Division
315 Front Street West, 11th Floor 
Toronto, ON M7A 0B8

TO: Consolidated Municipal Service Managers (CMSMs)
       District Social Services Administration Boards (DSSABs)

FROM: Holly Moran, Assistant Deputy Minister, Early Years and Child Care Division

DATE: November 30, 2023

SUBJECT: 2024 Child Care, EarlyON Child and Family Centres, and Canada-wide Early Learning and Child Care Funding

We continue to invest and make strides in our work together to deliver affordable, accessible and high-quality child care to Ontario’s families. With that, and as promised in September, I am pleased to share the following to support municipal planning for 2024:

  • 2024 Child Care Funding Allocations
  • 2024 Child Care and EarlyON Child and Family Centres Service Management and Funding Guidelines (EYCC guidelines)
  • 2024 Canada-wide Early Learning and Child Care System Guidelines (CWELCC guidelines)
  • 2024 transfer payment agreement (to be shared under separate cover).


Investments from the Government of Ontario and the Government of Canada in the child care and early years system will total more than $3.9B for 2024. Funding will support the implementation of previously announced fee reductions, workforce supports and other measures. This investment represents an increase of $42M over 2023.

$1.6B is being invested in pre-CWELCC child care programs, including:

  • $1.2B in general allocation and Child Care Expansion Plan
  • $26M in base funding for Licensed Home Child Care
  • $146M in Canada-Ontario Early Learning and Child Care funding
  • $203M in Wage Enhancement/Home Child Care Enhancement Grant funding

$162M is being invested in EarlyON Child and Family Centres, including:

  • $101M in provincial allocation
  • $61M in Canada-Ontario Early Learning and Child Care funding

$2.1B is being invested in CWELCC, including:

  • $1.9B for fee reductions and workforce compensation
  • $28M for CMSM/DSSAB CWELCC administration
  • $66M for space creation
  • $75M for emerging issues
  • $85M for start-up grants

$34.5M in other investments, including:

  • $25.5M for off-reserve Indigenous-led Child Care, and Child and Family Programming; and
  • $9M for mental health programs over three years, from 2022-23 to 2024-25.

Key changes

A.Updates on funding for cost escalation

The ministry recognizes that licensees may be subject to cost escalation beyond their control (e.g., rent increases, inflation). The ministry has included cost escalation funding of approximately $235M to support licensees. CMSMs/DSSABs should provide cost escalation funding to licensees using updated cost escalation factors. Refer to Section 7 of the 2024 CWELCC guidelines for more information.

B. Additional funding for emerging issues

In addition to the cost escalation funding, the ministry is also allocating an additional $75M to support emerging issues for CWELCC-enrolled licensees. CMSMs/DSSABs are required to implement a fair and transparent process (such as through an application) to allocate this funding to licensees who demonstrate that their revenue for eligible spaces (including routine funding, fee reduction, wage enhancement, workforce compensation, cost escalation and parent fees) is insufficient to support the licensees’ non-discretionary costs. This funding is a new and separate allocation under the 2024 transfer payment agreements.

The ministry will be seeking to gain an early understanding of uptake of this component of the program. CMSMs/DSSABs must report funding commitments by Monday, February 5, 2024. See attached template. Refer to Section 8 of the 2024 CWELCC guidelines for more information.

C.Updates under Wage Enhancement Grant (WEG) and Home Child Care Enhancement Grant (HCCEG)

The ministry has increased the hourly wage maximum for WEG and HCCEG to help close the gap between RECEs in the education sector and eligible RECEs in licensed child care settings. The new hourly wage maximum for WEG is $30.59 per hour, for full HCCEG is $305.90 per day and for partial HCCEG is $183.54 per day.

D.Updates on allocation holdbacks

For 2024, the ministry has removed the 5 per cent holdback policy on all allocations. In its place, the ministry will withhold a portion of CWELCC funding equal to the difference between a CMSM’s/DSSAB’s fee reduction allocation calculated at full licensed capacity versus calculated at assumed targeted operating capacity.
CMSMs/DSSABs will still have flexibility within their CWELCC allocation to provide funding up to the licensees’ targeted operating capacity. To access additional funding to support operating capacity beyond the assumed targeted operating capacity (and up to full licensed capacity), CMSMs/DSSABs will be required to demonstrate that space occupancy exceeds the assumed targeted operating capacity.

E.Adjustment to align to the calendar year

For 2024, an adjustment is being made to realign the allocation with the cash payment stream. As the January 2024 fee reduction and workforce compensation amounts totaling $161M are included in the December 2023 payments, these amounts are not part of the 2024 allocations as they will have already been provided. The adjustment will be applied to monthly payments (from January to December).

F. Expiry of the one-time transitional grant

In 2021 and 2022, the ministry introduced changes to provincial administrative funding, specifically the requirement to cost share all provincial child care administration funding at a rate of 50/50 and reducing the allowable administrative funding threshold from 10% to 5%.
Considering the impacts of the COVID-19 pandemic and the significant changes to the system introduced by CWELCC in 2022, the ministry provided a transitional grant to CMSMs/DSSABs for 2023 to support CMSMs/DSSABs while they found efficiencies and adjusted their administrative cost structures. After three years of funding, over which the ministry has invested a total of $220M to help stabilize the system during exceptional circumstances, the one-time transitional grant will be discontinued for 2024.

G.Expiry of the Canada-Ontario Early Childhood Workforce Agreement

In August 2021, the governments of Ontario and Canada signed the Early Childhood Workforce Agreement (WFA), which provided Ontario with about $150M in one-time federal funding to support the recruitment and retention of the early childhood workforce. The Agreement was amended in September 2022 to permit completion of the initiatives by March 2023. In recognition of the workforce supports in the CWELCC Agreement the early years and child care workforce support provided through the WFA will not continue in 2024.

H. Value-for-money audits

CMSMs/DSSABs who directly operate child care centres are required to retain independent advice (e.g., third-party services) and conduct a value-for-money audit on their direct delivery of child care services.
The purpose of the value-for-money audit is to determine whether provincial funding is being used efficiently and effectively by directly operated centres, and whether the child care services could be offered by a third-party provider instead. The audit report, recommendations and management responses should be posted publicly.

Other important information

Recently announced Ontario Child Care Workforce Strategy
The Ontario Child Care Workforce Strategy was announced on November 16, 2023. The Workforce Strategy will support the recruitment and the retention of qualified professionals, help achieve system growth, and ensure increased access to high-quality licensed child care in the province. The ministry is working on the implementation of the Workforce Strategy and will be communicating further details in the coming months.

EarlyON Child and Family Centres

To support EarlyON Child and Family Centres in delivering mandatory core services that are responsive to local needs, the ministry has provided clarification in the guidelines around eligible expenses for light meals or snacks for EarlyON program participants.
The ministry has also made updates to emphasize the critical role that EarlyON staff play in the early identification of child development concerns and in connecting families to specialized services.

Clarification on CWELCC recoveries

On September 8, the ministry distributed an additional Q&A document to provide greater clarity on the 2023 CWELCC System Update materials shared in late May and early June 2023. CMSMs/DSSABs are encouraged to review the ministry’s expectations related to recoveries upon year-end reconciliation.
Specifically, as part of the year-end financial review and reconciliation process with licensees, CMSMs/DSSABs must ensure CWELCC funding is used to support the actual eligible costs incurred by licensees and, when vacancies on eligible spaces lead to cost avoidance, CMSMs/DSSABs should work with licensees to identify savings related to those avoidable costs and recover up to 52.75% of such savings (which is the government contribution towards the base fee).

Upcoming CWELCC funding approach

The ministry continues to work on finalizing a new child care funding approach that aims to integrate current child care funds into the new CWELCC funding formula. Information about a new funding approach will follow later providing sufficient time to support a smooth implementation.

Thank you for your ongoing support and valuable feedback. We look forward to working together to support the sector, children and families. If you have any questions, please contact your Early Years Advisor or Financial Analyst (contact list can be found on the ministry website). 


Original signed by 

Holly Moran

Assistant Deputy Minister
Early Years and Child Care Division
Ministry of Education

c: Early Years Advisors, Programs and Service Integration Branch Financial Analysts, Financial Accountability and Data Analysis Branch



  • 2024 Child Care and EarlyON Child and Family Centres Service Management and Funding Guidelines
  • 2024 Canada-wide Early Learning and Child Care System Guidelines
  •  Appendix A - 2024 Child Care Funding Allocations
  • Appendix B - 2024 EarlyON Funding Allocations
  • Appendix C - 2024 CWELCC Funding Allocations
  • Update on Emerging Issues Funding Application and Commitment Status