Monday, October 29, 2007

Big-Box Day Care Comes to Alberta

{ British Columbians, take heed: this is the land where Gordon Campbell gets many of his ideas. The following is a letter written in response to today's article in the Edmonton Journal ,which reported the announced bid of the Australian multinational, ABC Learning Centres, to buy nine day care centres in Edmonton and even more in Calgary, along with the response of Alberta Childrens' Services declaring neutrality with respect to foreign and chain ownership of day care delivery.}

Dear Editor:

Your article on the purchase of day care centres in Alberta by an Australian Multinational, ABC Learning Centres (“Day-care giant seeks foothold in Alberta”, Monday October 29, 2007) quotes a government spokeswoman as saying that foreign and chain ownership are not concerns of the government: "We look past who is in the boardroom and look at whether they are meeting our standards,"(p. A3).
This may represent an enlightened attitude toward investment in a world of globalized capital markets where Canadians have as strong an interest in investing abroad as foreigners do in investing in Canada. But does it represent sound social policy? There is no indication in the article that Alberta Childrens’ Services considered the trade law implications of foreign corporate investment in the child care sector. Foreign private provision to private consumers, even on a subsidized basis and to parents utilizing federal tax rebates, would almost certainly fall outside of the WTO’s so called “exclusion clause”, Article I:3, which defines services supplied in the exercise of governmental authority as those which are supplied “neither on a commercial basis nor in competition with one or more service suppliers”.
Furthermore, if the Alberta government is explicitly unconcerned with foreign and chain ownership, it must be amenable to U.S. and Mexican entry into the market as well. That would mean not only additional WTO obligations to these countries, but NAFTA ones: it is by no means clear that child care delivered by foreign corporations would fall within the NAFTA Annex II Social Services Reservation, and it is quite likely that a U.S. or Mexican corporation could avail itself of its Chapter 11 investor rights.
While it is not necessarily true that standards must suffer as a result, our ability to change course and substitute public provision in the future could be fatally compromised if the total cost of potential WTO and NAFTA claims made such a move prohibitively expensive. In the absence of any evidence that such a risk analysis has been undertaken, I would suggest that the Alberta government is wrong to express indifference toward foreign and chain ownership in the area of child care.

Mark Crawford

Assistant Professor, Political Science
Athabasca UniversityTel. (780) 423-6020


Bill Tieleman said...

Hi Mark,

Thanks for your warning - the alarm has already been rung here in BC by the Coalition of Child Care Advocates of BC.

Here's a story my newspaper, 24 hours, did last Monday:

October 22, 2007

Big-box child care for B.C.?


Controversial big-box child-care could be a reality in B.C. if an Australian company has its way.

Child-care advocates are sounding the alarm since learning an investment firm called Adroit Investments LLC has contacted local child-care operators in a bid to buy them out.

The Coalition of Child Care Advocates of B.C. traced the company back to 123-Global and A.B.C. Learning Centres, a private Australian child-care corporation that's gotten flak in several countries for monopolizing child-care and providing minimal services to cut costs.

Rita Chudnovsky, the coalition's spokesperson, says that the company has now set its sights on B.C.

"This is not the kind of child care we need," she said. "Everywhere [A.B.C.] has gone, it's raised parent fees and left communities with specific needs underserved. They only care about the bottom-line. Our children shouldn't be used to generate profits."

Chudnovsky says child-care operators began receiving takeover bids in mid-September, just before the provincial government announced it would begin to subsidize private child-care providers.

"We have trouble believing this is a coincidence," she said. "We're still waiting for the government to respond."

Meanwhile, some child-care providers approached by Adroit wonder if they will be able to compete.

"We've known about them for years," said Susan Harney, operator of Country Grove Children's Centre in Langley. "They build up what they call critical mass and put other programs out of business."

Harney has already rejected Adroit's advances and wants others to do the same. "Our child-care system is not for sale," she said. "The focus needs to be on providing good service, not making a profit."

A phone call to 123-Global was not returned by press time.

Mark Crawford said...

Thanks Bill---the big question now is whether the Campbell Liberals will be as inclined as the Alberta Tories to "look past the boardroom" and just let the market decide...

Mark Crawford said...

P.S. I wonder why the announcement came a week later in Alberta than in BC--could it be that the Government (and/or the industry) wanted to delay the announcement so that it would be swamped by the big Oil Royalty Announcement? That would certainly explain why my letter wasn't printed yesterday--when editorial pages were still completely swamped by the royalties issue....

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