of british columbia · victoria, british columbia september 1996. 3 highlights. 1996/97 report 1:...

Auditor Generalof British Columbia

O F F I C E O F T H E

Management ofChild Care Grants

Ministry of Women’s Equality

1 9 9 6 / 1 9 9 7 : R e p o r t 1

Performance Audit

LOCATION:8 Bastion SquareVictoria, British Columbia

V8V 1X4

OFFICE HOURS:Monday to Friday8:30 a.m. – 4:30 p.m.

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INTERNET HOMEPAGE:Further information and reports at:http://www.aud.gov.bc.ca/

Auditor Generalof British Columbia

O F F I C E O F T H E

Canadian Cataloguing in Publication Data

British Columbia. Office of the Auditor General.Performance Audit : Ministry of Women’s Equality :

management of child care grants

(Report ; 1996/97: 1)

ISBN 0–7726–2984–6

1. British Columbia. Ministry of Women’s Equality – Evaluation. 2.British Columbia. Ministry of Women’s Equality – Auditing. 3. Child care

services – British Columbia – Evaluation. 4. Child care services – British

Columbia – Auditing.I. Title. II. Series: British Columbia. Office of the Auditor General. Report ;

1996/97: 1

HV861.C32B74 1996 354.71100681’3 C96-960261-8

A u d i t o r G e n e r a l o f B r i t i s h C o l u m b i a

Auditor General’s Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

Audit Purpose and Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5Overall Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5Key Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

Detailed Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11A Brief History of Child Care in Canada . . . . . . . . . . . . . . . . . . . . . .11Government’s Response to the Call for Child Care . . . . . . . . . . . . . .11On–going Initiatives Related to Child Care . . . . . . . . . . . . . . . . . . . .13Child Care is a Shared Responsibility . . . . . . . . . . . . . . . . . . . . . . . . .14Child Care Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14Objectives of This Audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

Coordination of Information for the BC 21 Child Care Expansion Initiative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

History of the Initiative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22Role of the Ministry of Women’s Equality . . . . . . . . . . . . . . . . . . . . .22Coordinating Information for a Cross–ministry Project . . . . . . . . . . .23

Wage Supplement Initiative for Child Care Workers . . . . . . . . . . . . . .28

Government’s Wage Redress Strategy . . . . . . . . . . . . . . . . . . . . . . . .28Secondary Impacts of the Wage Supplement Initiative . . . . . . . . . . .28Managing Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29Managing for Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30

Incentive Grants for Child Care Facilities . . . . . . . . . . . . . . . . . . . . . . .33Purposes for Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33Types of Funding Available . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33Managing Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34Managing for Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36

Child Care Support Program for Caregivers and Parents . . . . . . . . . .38Supporting Child Care at the Local Level . . . . . . . . . . . . . . . . . . . . . .38Child Care Support Program Services . . . . . . . . . . . . . . . . . . . . . . . .38Managing Spending . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38

Managing for Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39

Ministry Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43

Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

Office of the Auditor General: Audit Objectives and Methodology . . . . . . . . . . . . . . . . . . . . . . . . . .47

table of contents

11 9 9 6 / 9 7 R e p o r t 1 : M a n a g e m e n t o f C h i l d C a r e G r a n t s


This report, my first to the Legislative Assemblyfor the 1996/97 year, contains the results of myoffice’s performance audit of the management ofchild care by the Ministry of Women’s Equality.

The ministry is responsible for coordinating childcare policy across government. As part of thiscoordination it provides information about childcare needs to decision–makers in other ministries.The ministry also provides grants to communitygroups and child care facilities to improve thequality, affordability, and accessibility of all typesof child care.

In this audit we first assessed whether, overthe past three years, the ministry had properlycoordinated child care information for thegovernment–wide BC 21 Child Care ExpansionInitiative, which resulted in approximately 3,000new or relocated child care spaces at a cost of

$32 million. Proper coordination of child care informationwas needed to ensure that facilities being approved forconstruction by other government agencies conformed withprovincial objectives for child care.

We also examined the ministry’s management of annualspending of more than $20 million, over which it has directcontrol, and its management for results. With increasingpressures to make good use of limited government funds, itis important to ensure that money is not being given to thewrong people or in the wrong amounts. Also, my Office iscontinuing to emphasize the need to focus on the actualresults of government programs, rather than simply onactivities and money spent, to improve the way programsare managed and delivered.

We examined ministry spending for: the Wage SupplementInitiative for raising child care worker wages; the Child CareGrant Program for providing incentives to child care facilityoperators to maintain or expand the existing number of childcare spaces; and the Child Care Support Program for fundingindependent non–profit agencies that provide child careinformation to providers and parents.

We concluded that the ministry is properly managing spendingand making progress in managing for results. However, itcould do more to determine where child care needs aregreatest so that limited funding can be put to the best use—

auditor general’s comments

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with respect to ministry spending and coordinating cross–government projects.

I greatly appreciate the cooperation shown to my audit staffby the ministry’s executive and staff throughout the audit.

George L. Morfitt, FCAAuditor General

Victoria, British ColumbiaSeptember 1996

3

highlights



Audit Purpose and ScopeWe conducted this audit to assess whether the Ministry ofWomen’s Equality is:

n coordinating information so that new child care spaces arebeing built by other government agencies where the needis greatest, according to child care standards, and inlocations that do not compete with existing facilities;

n managing spending so that ministry child care funds areused only for approved purposes; and

n managing for results by assessing the extent to whichministry spending is achieving intended child care goals.

As our focus was on the Ministry of Women’s Equality, wedid not audit the work of other ministries involved in childcare, such as:

n Ministry of Social Services administration of day caresubsidies for parents with low incomes or special needschildren;

n Ministry of Health licensing of child care facilities andworkers; and

n Ministry of Education, Skills, and Training provision ofchild care worker training and support services for childcare at educational institutions.

Our audit field work took place from December 1995 toMarch 1996. During that time we examined ministryactivities between April 1994 and December 1995. We alsoconsidered the effects of the ministry’s newly developedstrategies pertaining to those programs being audited, suchas how to evaluate results of new programs being fundedunder the joint federal–provincial Child Care StrategicInitiative pilot project.

Overall ConclusionAs part of the three–year $32 million cross–government BC21 Child Care Expansion Initiative that ended in 1995, over3,000 child care spaces were created or relocated in hospitals,schools, colleges, and universities. We found that the ministrycontributed positively to this initiative by approving new

management of child care in british columbia

6



spaces that were constructed according to child carestandards and in locations where they would not competewith existing facilities. However, because it did not haveadequate information about unmet needs on a regionalbasis, the ministry was not able to determine whetherpriority was being given to areas of the province wherechild care needs were greatest.

In managing its own spending, the ministry gave out$34 million in child care grants from April 1994 toDecember 1995 with due regard for stated priorities fortypes of care, and all to eligible recipients in accordancewith approval guidelines.

In managing for results, the ministry needs to do more toset measurable goals and collect information about theextent to which they are being met. In recognition of thedesirability of stating goals in measurable terms, the ministryhas joined a recent government–wide initiative to improveaccountability. It has begun work to assess properly theimpact of its spending by developing key measures for allof its child care programs, and by gathering initial data formost of these measures.

Key FindingsNew child care spaces do not compete with those already existing,but may not be where they are most needed

As coordinator for the BC 21 Child Care ExpansionInitiative, the ministry provided child care information toother ministries that spent $32 million to create or relocateapproximately 3,000 child care spaces from 1993 to 1995.The ministry reviewed applications for funding to ensurethat new spaces would meet child care standards and bebuilt far enough away from existing facilities that theywould not take away from existing enrollments.

Although the ministry had details about locations of childcare facilities and enrollment numbers, this informationhad not been compared with estimates of demand forchild care to produce a provincial picture of unmet childcare needs. The ministry lacked information on wherechild care deficiencies were greatest and, as a result, itsBC 21 partners simply responded to the areas wherecommunity child care groups were organized enough toapply for funding.

Child care money is being spent only for approved purposesFor each of its child care grant programs, the ministry hasdeveloped guidelines that agencies have to meet to qualify



for funding. The guidelines describe the standards ofquality and types of services and expenditures that thegovernment will subsidize. We concluded that the$34 million given out by the ministry from April 1994 toDecember 1995 was given only to agencies that metspecified standards and only for the types of services andexpenditures included in approval guidelines.

The wage redress initiative raises caregiver wage levels, but its impacton accessibility, quality, and affordability of child care is not yet known

Child care workers have been identified as among thelowest paid in the social services sector. As part of a cross–government wage redress initiative, the ministry gave out$15 million from April 1994 to December 1995 to child carefacility operators to distribute to caregivers. It then followedup to see that operators had given the money to theiremployees in prescribed amounts. Since the programstarted in 1994, average wages for eligible child careworkers in licensed child care centres have gone from $11to $14 an hour.

The ministry believes that its wage supplement programhas important secondary impacts on accessibility, quality,and affordability of child care. However, the ministry hasnot yet assessed the extent to which the program affectsthese goals. One reason the ministry gives for this is thatthe program focuses on a narrow section of existing childcare arrangements—licensed child care centres serve onlya small percentage of children receiving care. Therefore, theimpacts on quality, accessibility, and affordability may nothave far–reaching effects on the child care system as awhole. Another reason given is that measuring outcomesof program spending is still a relatively new concept ingovernment, and the ministry needs more time to collectinformation about changes in worker turnover, workerqualifications, and parent fees.

Ministry gives priority to funding care for infants and toddlers,children in rural locations, and out–of–school care children, butdoes not set targets for meeting deficiencies in child care needs

The ministry supplies grant money to child care agencies asan incentive to create or maintain spaces for types of childcare that have been identified as deficient. Grants auditedwere found to be given out with due regard for ministrypriorities, namely child care for infants and toddlers,children in rural locations, and out–of–school care children.

Although priorities are established in terms of types ofcare to fund, no targets are set for the number of child care

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spaces that are to be created or maintained with the resourcesassigned. To do this would require the ministry to developstandard cost guidelines for building and for maintainingchild care spaces, and it has not done so.

Ministry is making progress in measuring performance of its ChildCare Support Program

The ministry’s Child Care Support Program contracts withnon–profit agencies to assist caregivers in improving thequality of child care and parents in obtaining child care.Until recently, the ministry focused its measurement effortson the activities of program agencies, such as the numberof training courses given for caregivers and the number ofparents referred to child care facilities. This was done as ameans of monitoring whether agencies were meetingcontract requirements.

To meet the evaluation requirements of a joint federal–provincial Child Care Strategic Initiative pilot project, theministry is now giving more attention to program results bymeasuring indicators that are linked to changes in qualityand accessibility of child care. For example, increased usageof training and other resources provided to caregivers willbe used as an indicator that the quality of care they provideis likely to improve.

In so doing, the ministry is moving toward being able toevaluate the extent to which this program is having animpact on quality and accessibility of child care. However,we believe the ministry should also consider ways ofmeasuring more directly the extent to which, as a resultof using program services, caregivers actually do providebetter quality care and parents are better able to access childcare arrangements.

detailed report

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A Brief History of ChildCare in Canada

The evolution of child care inCanada mirrors the country’s socialand economic development duringthe last century. Before the secondworld war, not many mothersworked outside the home. Duringthe war that situation changed, aswomen entered jobs left vacant bymen involved in the war effort.When the war was over, many ofthese women decided to remain inthe work force and the need fornon–parental child care becameapparent. Within a few years,government saw the need toregulate the quality of care, andbegan to license and inspect childcare facilities.

In the 1950’s, the need fortraining of child care workers wasrecognized, with a growing emphasison how to provide quality care. Inthe 1960’s, government began tooffer child care subsidies to lowincome families to enable parentsto enter or stay in the work force.In the 1970’s and 1980’s, the numberof working mothers continued togrow and, at the same time, thedemand for child care increased.A number of federal studies wereconducted during that time, all ofwhich pointed to a need forimproved access to child care.

In 1987, in response tocontinuing public demand for moreadequate child care, the federalgovernment commissioned theCanadian National Child CareStudy to assess the adequacy ofchild care and the need forgovernment involvement. Thestudy found that more than half

of the parents who wanted to uselicensed child care were unable toreceive such care, usually becauseof the lack of available spaces. Thestudy concluded that:

Canada’s child care andparental leave programs fall shortof meeting the needs of children,parents and society. The time islong overdue for governments totake action to remedy thesituation, as all Canadians pay forthe effects of inaction. Parents payin terms of stress, earningsinterruptions, and missedemployment opportunities.Children pay when they fail todevelop the skills needed tosucceed in this complex world.Employers pay through lostproductivity, now and in thefuture. Society pays for thecreation and maintenance ofremedial services.

In the 1990’s, the debate abouthow much government fundingshould go to support child care hascontinued at both the federal andthe provincial levels.

Government’s Response to the Call for Child Care

In British Columbia, as in therest of Canada, families are becomingmore diverse in their composition,work patterns, and needs. As peoplecontinue to move away from theirplaces of origin, they are less likelyto have family members close byto assist with child care. Risingdivorce rates have resulted in acorresponding increase in thenumber of single–parent families,mostly led by women. Also, most

introduction

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two–parent families are today likelyto be two–income families.

The proportion of women inthe British Columbia work forcehas been steadily rising and is nowmore than 45%, thus increasing theneed for child care. Of 640,000children aged 12 years and under in

1995, approximately two–thirds didnot have a parent at home full–time(Exhibit 1).

In 1991, in the wake of theNational Child Care Study, theBritish Columbia governmentestablished the provincial TaskForce on Child Care. The report of

Source: Prepared from information provided by Ministry of Women’s Equality based on current estimates for the number of children andpercentage estimates in the 1987 Canadian National Child Care Study

Exhibit 1

Child Care Arrangements for Children in British ColumbiaChildren 12 years of age and under



its work, Showing We Care—A ChildCare Strategy for the 90’s, identifiedthe need for coordination andfunding to support, stabilize, andexpand child care services.

The Task Force found that oneof the main barriers to expandingchild care was that no individualministry had responsibility tooversee the development, delivery,and support of a full range of childcare options. It also pointed toresearch findings suggesting that a$1 investment in child care returns$6 in taxpayer savings because oflower costs of public welfare andcrimes and higher workerproductivity.

The Ministry of Women’sEquality was formed in 1991 andgiven responsibility for managingall child care spending, includingday care subsidies and special needsday care funding administered bythe Ministry of Social Services.

The Ministry of Women’sEquality now coordinates child carepolicy across government and isresponsible for the development,implementation, and delivery ofprograms designed to meet thefollowing goals:

n assist communities to addresschild care needs;

n improve the quality, affordability,and accessibility of all types ofchild care;

n stabilize existing child carefacilities; and

n expand child care servicesand options.

The ministry’s child carebranch, which has 22 full–timeequivalent staff, has three programareas: the Wage SupplementInitiative, Child Care Grants, andChild Care Support.

To encourage an increase in thenumber of regulated spaces, most ofthe province’s funding for child carein the last five years has gonetoward licensed care. From May1991 to July 1995, the number oflicensed child care spaces in theprovince has grown by almost50%—from 43,000 to 63,000. At thesame time, care arrangements forwhich licenses are not requiredcontinue to provide the majority ofchild care spaces. Growth figuresare not readily available for thissector because it is not regulated bygovernment and, while some suchspaces are registered with theministry’s Child Care SupportProgram, it is not known whatpercentage they are of the total.

On–Going InitiativesRelated to Child CareMinistry of Women’s Equality

A number of initiatives nowunderway are expected to havesignificant effects on the delivery ofchild care. One of these is the ChildCare Strategic Initiative project, ajoint federal–provincial cost–sharingprogram set up in 1995/96 toexamine the planning, delivery, andeffectiveness of new and innovativeways of managing and deliveringchild care services.

One component of this ministryinitiative is “Community One–StopAccess Centres” that will delivercentralized and coordinated accessfor caregiver training and equipmentloans, and for parent referral tochild care facilities or financialassistance.

Another component,“Community DemonstrationProjects,” aims to test newapproaches to improving the quality

14



of child care in a variety of settingsincluding the unregulated sector.These projects will also examineways of improving child carefinancial and administrativemanagement; integrating andcoordinating child care services tomeet specific community needs;and improving accountability forthe use of public funds.

Ministry of Social ServicesThe BC Benefits program was

set up in 1995 to encourage peopleon income assistance to enter thework force or job training programs.One child care–related impact ofthis program is that single parentsrequiring assistance now have tolook for work as soon as theirchildren reach seven years of age,rather than the former age of 12.As those affected return to work,the need for child care is expectedto increase.

Transition Commission forChild and Youth Services

Recent events have capturedthe public’s interest in the care andwelfare of children. Following thedeath of young Matthew Vaudreilin 1994, Judge Thomas Goveconducted an inquiry into theadequacy of child protection servicesin British Columbia. His reportcontained recommendations thatled to the recent appointment of aTransition Commissioner for Childand Youth Services. During herthree–year term, the Commissioneris to develop and implement newways for protecting children. Thiswill include, among other things,an examination of how child careproviders are recruited, trained,and accredited.

Child Care is aShared Responsibility

The Ministry of Women’sEquality is responsible forsupporting, stabilizing, andexpanding child care in conjunctionwith other government agencieshaving complementary child careresponsibilities (Exhibit 2). It doesthis by leading an interministryChild Care Policy Team thatsupports government’s child careobjectives and coordinates childcare policies and programs.

The Minister of Women’sEquality also solicits advice onprovincial and community childcare needs from a Provincial ChildCare Council. Members arenominated by community groupsand are appointed by the Minister,who aims to get representationfrom a range of geographical areasand interest groups in the province.

Child Care PrinciplesThree principles are generally

accepted as vital for a sound,comprehensive child care system:accessibility, quality, andaffordability.

Accessible Child CareAccessibility relates to a

parent’s ability to obtain child carethat meets her or his needs—licensed or informal, family– orcentre–based, full– or part–time,and during normal or otherworking hours. Improvingaccessibility of child care isprimarily the responsibility of theMinistry of Women’s Equality.

The ministry has a number ofprograms to stabilize, support, andexpand access to child care.



n Stabilizing child care includesspending to maintain the existingsupply of child care spaces andworkers from one year to thenext. This is funded through theministry’s Wage SupplementInitiative, Infant–ToddlerIncentives, and EmergencyRepair, Relocation, andRenovation grants.

n Supporting child care includesproviding information tocaregivers about quality childcare and to parents about access

to child care. This is fundedthrough the ministry’s ChildCare Support Program.

n Expansion includes creating newspaces in both new and existingfacilities. The ministry fundsthis through its Infant–ToddlerIncentives and Facilities andEquipment grants, andcoordinates this by sharing childcare information with otherministries, as it did for the BC 21Child Care Expansion Initiative.

Adapted from Child Care: A Community Partnership, Ministry of Women’s Equality

Exhibit 2

Child Care Policy TeamPartnerships and Responsibilities

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Quality Child CareQuality child care is usually

assessed in terms of two maincomponents: aspects of the physicalsetting (safety features, group sizes,caregiver to child ratios, size ofspace per child, and toys andequipment) and the behavior ofcaregivers (assumed to bepositively influenced by suitabletraining).

In British Columbia, theMinistry of Health inspects andlicenses child care facilities, andreviews and certifies caregiverqualifications (Exhibit 3). TheMinistry of Education, Skills andTraining provides funding for EarlyChildhood Education courses inpost–secondary educationalinstitutions (Exhibit 4).

Exhibit 3

Ministry of HealthChild Care Related Programs

Source: Ministry of Health

Child Day Care Licensing Program The purpose of child day care licensing is to provide public assurance that essential standardsfor health, safety and care are developed, implemented, monitored and enforced, in order toprotect the health, safety, and well–being of children in licensed facilities.

In 1988 there was a total of 35 licensing officer positions in provincial health units andmunicipal health departments across the province. Currently there are approximately 76licensing officer positions across the province which spend about 68% of their time on childcare licensing issues. This is equivalent to approximately 52 licensing officer positionsdedicated to child care licensing.

Certification of Early Childhood EducatorsThe Community Care Facilities Branch, under the Community Care Facility Act has responsibilityfor the certification of Early Childhood Educators and the approval of early childhoodeducational programs.

Work has commenced to transfer the responsibility for certification and educational programapproval from the Ministry of Health to a College of Registration for Early Childhood Educatorsestablished under the Health Professions Act. This transfer is consistent with the Ministry ofHealth’s new role under New Directions as being primarily responsible for planning, developmentof policy, standards, and guidelines, health promotion, and service evaluation.

Early Intervention Program, Child Development and Rehabilitation SectionThe Early Intervention Program provides intervention and support to children with specialneeds and to their families to prevent or reduce the consequences of disabling conditions,particularly in young children. The Early Intervention Program provides therapy services in theform of physiotherapy, occupational therapy, and speech–language intervention, as well asfamily support services to children who have, or are suspected of having, a neurologicaldisorder or a significant developmental delay. The Early Intervention Program offers theseservices from the time of the child’s birth or after the identification of a special need, untilschool entrance.



The Ministry of Women’sEquality, under its Wage SupplementInitiative, provides funding tooperators of licensed child carefacilities to provide higher wages to

workers. It also funds Child CareSupport Program agencies, whichprovide advice and training onquality child care to caregivers inthe licensed and license–not–

In British Columbia, students can study early childhood education (ECE) in community colleges,private training institutions, and universities, or through continuing education programs of collegesor schools. The Ministry of Education, Skills, and Training supports the following types of ECEtraining either through base or grant funding of training delivery, funding development of newcurricula, or partnerships with other ministries and other levels of government on initiatives whichfurther support training in this sector:

Basic ECE Certificate – Most often offered as either a 10 month or 3 semester program. A “basictraining program” is a provincially legislated requirement that includes completion of satisfactorypracticum placements before the student qualifies for an ECE certificate.

Post–Basic ECE Infant/Toddler and Post–Basic ECE Special Needs Certificate – Seventeen postsecondary institutions offer post–basic certificates in infant/toddler care, and 20 offer post–basiccertificates in special needs (caring for children who require extra support). Students who havecompleted basic training may take advanced courses toward a post–basic certificate. The lengthof a post–basic program usually ranges from one semester to 10 months, with most institutionsoffering post–basic programs on a part–time basis.

Early Childhood Education and Care Diploma Equivalencies – Sixteen institutions currently offeran ECE Diploma at the completion of some combination of post–basic and/or advanced coursework. The length and composition of these programs varies widely.

Family Daycare Training Certificate (FDC) – Family daycare providers do not have legislatedmandatory training requirements; however, care providers are encouraged to participate in FDCtraining. Twenty–hour introductory training is available, as well as more in–depth training throughthe 150 hour Certificate Program. Seven colleges are currently offering the 150 hour CertificateProgram in over 25 communities.

School–Age Training – Training for School–Age care providers is not regulated, but is encouraged.Specific school–age courses have recently been developed and piloted at a number of institutions,with additional institutions expected to begin offering school–age training.

Laddering Opportunities – Graduates of child care training programs can often ladder into otherlevels of ECE programming or advance into degree programs. For example, block transfer ofcredits to Child and Youth Care bachelors programs is available for ECE graduates who meetestablished criteria. Family Daycare providers completing 150 hours of training can receiveadvanced credit for some Basic ECE certificate courses should they wish to pursue further trainingin the field.

Exhibit 4

Ministry of Education, Skills and TrainingEarly Childhood Education and Care Training

Source: Ministry of Education, Skills and Training

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required sectors. Both of theseprograms are described in moredetail throughout this report.

Affordable Child CareAffordability of child care is

driven by the amount parents haveto pay to obtain suitable child carespaces for their children. Fees vary,depending on the age of the childand the type of care provided. InBritish Columbia, as in the rest of

Canada, most parents use informalchild care for which they pay thefull cost.

Government subsidizes parentfees in two ways: by giving grantsto licensed child care facilities toencourage them to provide childcare at a reasonable cost; and bypaying part or all of the fees forlow–income families who wouldotherwise not benefit financiallyby working. The former type of

HALF DAY FULL DAY TOTAL

Family Day Care (0–18 months) 117 1,348 1,465Family Day Care (19–36 months) 189 2,676 2,865Family Day Care (3–5 years) 775 6,740 7,515

Total Family Care 1,081 10,764 11,845

Group Day Care (0–18 months) 33 382 415Group Day Care (19–36 months) 51 988 1,039Group Day Care (3–5 years) 203 4,399 4,602

Total Group Care 287 5,769 6,056

In–Home Care (1st child, 0–18 months) 59 349 408In–Home Care (1st child, over 18 months) 468 2,084 2,552In–Home Care (2nd child, 0–18 months) 6 30 36

In–Home Care (each additional child) 532 1,637 2,169Total In–Home Care 1,065 4,100 5,165

Out of School (Kindergarten) 46 202 248Out of School (Grade 1 and up) 2,721 4,160 6,881

Total Out–of–School Care 2,767 4,362 7,129

Nursery School 1,677 9 1,686Total Nursery School Care 1,677 9 1,686

Total Child Day Care Subsidies 6,877 25,004 31,881

Exhibit 5

Day Care Subsidy ProgramAverage number of children in subsidized care each month in 1995/96

Source: Ministry of Social Services



funding is distributed through childcare grants managed by theMinistry of Women’s Equality,and is discussed in more detailthroughout this report. The latteris administered by the Ministry ofSocial Services, on behalf of theMinistry of Women’s Equality,through the province’s incomeassistance district offices.

In 1995/96, parents of morethan 30,000 children under the ageof 12 years were supported throughthe Day Care Subsidy Programadministered by the Ministry ofSocial Services, a $100 millionexpenditure (Exhibit 5). A further$27 million was allocated to supportthe parents of over 3,500 childrenwith special needs (Exhibit 6). Toqualify for these subsidies, parentsmust meet social and financialcriteria specified in the GuaranteedAvailable Income for Need (GAIN) Actregulations.

Objectives of This AuditWe had three objectives in

conducting this audit. One was toassess the ministry’s coordinationof child care information with othergovernment agencies involved inbuilding child care spaces. For thepast three years, this has been donethrough the government–wide BC21 Child Care Expansion Initiative.

Our other two objectiveswere to examine the ministry’smanagement of spending overwhich it has direct control, and itsmanagement for results. Wefocused on: the Wage SupplementInitiative for raising child careworker wages; the Child Care GrantProgram for providing incentives tochild care facility operators tomaintain or expand the existingnumber of child care spaces; andthe Child Care Support Program forfunding independent non–profit

Over 3,500 children receive Special Needs Day Care, with a 1995/96 budget of $26.6 million.

This program, funded by the Ministry of Women’s Equality and administered by the Ministry ofSocial Services, provides child care experiences for children with one or more handicappingconditions. It is intended to facilitate the participation of these children in child care, and tosupport their parents in maintaining financial independence. Service may be provided through thepurchase of “special needs spaces” via contract, or through the provision of supports in typicalchild care settings via individual “authorization.” Typical child care settings may include groupday care, preschool, out of school care, licensed family day care, license–not–required family daycare, or care in the child’s home.

A 1993 program review and report entitled Supported Child Care emphasized the need forfamily–centered service and the inclusion of children who require extra supports in communitychild care settings with their typical peers. The provincial government has committed to makingthe shift to this approach by 1999, by which time the program would be called Supported ChildCare. This shift is occurring at different rates throughout the province, with implementationfunding through the federal–provincial Strategic Initiatives Agreement on Child Care.

Exhibit 6

Support for Children With Special NeedsSpecial Needs Day Care

Source: Ministry of Social Services

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agencies that provide childcare information to providersand parents.

Coordinating Child CareInformation with OtherGovernment Agencies

Because the ministry’s rolein cross–government projects toexpand access to child care did notinvolve direct control of spending,we looked instead at whetherthe ministry had adequatelycoordinated information used indecision–making.

Proper coordination of childcare information is important toensure that facilities beingapproved for construction by othergovernment agencies conform withprovincial objectives for child care.To use limited funding to the bestadvantage, decision–makers needinformation about where theneeds are greatest, what child carestandards have to be met, and howto avoid funding projects that willcompete with existing facilities.

Proper coordination ofinformation being shared byvarious agencies requires a soundcoordination strategy, preferablyestablished at the outset, withworking level agreements for eachof the players. Suitable informationthen has to be available so that itcan be provided as needed. Finally,reliable progress information needsto be prepared and given todecision–makers in a timely way.

Managing SpendingTo assess the ministry’s

management of child carespending, we looked at whetherrecipients had been adequatelyscreened for eligibility requirementsand whether payments were made

in accordance with approvalguidelines.

With increasing pressuresto make good use of limitedgovernment funds, it is importantto ensure that money is not beinggiven to the wrong people or inthe wrong amounts. To properlymanage spending, applicants forfunding have to be screened to seeif they meet pre–determinedeligibility criteria. Decisions thenhave to be made about which ofthose eligible applicants shouldreceive a share of limitedgovernment funding and howmuch they each should get. Thisrequires the use of approvalguidelines that spell out the typesof expenditures that are to befunded, along with standard costs.Finally, these guidelines have to beproperly applied so that paymentsare made in accordance with theguidelines.

Managing for ResultsTo determine whether the

ministry is adequately managingfor results, we looked to see whetherthe ministry has developed relevantmeasures and is using them toassess progress toward its goals.

Government is in the processof implementing a comprehensiveaccountability framework toassist it in improving performanceby managing for results. Theframework provides guidanceto government ministries forclarifying objectives and measuringand monitoring impacts of programefforts. It is based on the premisethat focusing on the actual resultsof government programs, ratherthan simply on activities andmoney spent, should improve theway programs are managed anddelivered.



Managing for results isknowing what you actuallyachieved in comparison to what youintended to achieve. For ministries,this involves setting performancetargets and measuring the extent towhich they are met. By focusing onresults, government can determinewhat difference it has made in thelives of its citizens. In turn, citizenscan judge for themselves whethergovernment programs are relevantand whether they are effective andefficient in meeting the objectivesthat government has set.

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History of the InitiativeThe BC 21 Child Care

Expansion Initiative began in1993/94, as part of the government–wide BC 21 Initiative established toimprove the Province’s investmentin infrastructure such as buildingsand roads.

The child care component ofthe overall initiative was set up inresponse to ministry estimates that,for 330,000 children in the provinceat that time potentially in need ofnon–parental care, only 42,000licensed spaces were available. Ofthe 288,000 children remaining, itwas estimated that 70,000 were ininformal arrangements with familyor friends of the parents, and manyothers were in unlicensed spacesthat met parent standards. Awarethat the 1987 National Child CareStudy had shown that the majorityof parents prefer to place theirchildren in licensed, regulated childcare spaces if they are available,government decided to allocate$32.3 million over three years tocreate additional licensed child carespaces. The new spaces were to beestablished in public institutions,such as schools, colleges, andhospitals.

This funding was given to threedifferent ministries to control aspart of each of their capital budgets:the (former) Ministry of Education,$19.5 million; the (former) Ministryof Skills, Training and Labour,$10.3 million; and the Ministry ofHealth, $2.5 million.

In 1993/94, the first year of theinitiative, $8.5 million was spent; in

1994/95, $13.8 million; and in1995/96, the remaining $10 million.This led to the creation or relocationof about 3,400 child care spaces intotal: 2,600 of these in schools, 600in colleges, and 200 in hospitals.

Role of the Ministryof Women’s Equality

The ministry’s role wasclearly defined in a 1993 CabinetSubmission as being that of having:

responsibility for planning andcoordinating the implementationof expansion initiatives, andproviding expertise and resourcesto assist individual ministries toensure effective implementation.

The ministry, which preparedthis joint submission with its partnerministries, committed to providinginformation about locations andtypes of child care already in place.It was expected that new spaceswould be constructed to meetlicensing standards at a reasonablecost, would not compete withexisting spaces, and that governmentfunding would be used whereneeds were greatest.

The ministry was alreadyperforming a similar function forthe funding of new spaces under itsFacilities and Equipment grants—described in more detail in thisreport under “Incentive Grants forChild Care Facilities.” The differencein the ministry’s role for the BC 21Initiative was that it did not havecontrol of spending decisions—thatlay with each of its partnerministries. Another difference forthe BC 21 Initiative was that the

coordination of information for theBC 21 child care expansion initiative



ministry did not require theagencies involved, namely schooldistricts and college and hospitalboards, to come up with matchingfunds. Other non–profit agenciesapplying for Facilities andEquipment grants are expected toraise 50% of funding themselves.

Coordinating Informationfor a Cross–ministryProject

Coordinating a project thatrequires communication acrossagencies operating under differentcontrols can be a complexundertaking. For this initiative, webelieve that three components wereessential:

n establishment of a soundcoordination strategy with clearobjectives, guidelines, andworking level agreements amongthe various players;

n provision of suitable child careinformation that was reliable andcomplete; and

n preparation and transmission ofrelevant progress information todecision–makers, withexplanations of any variancesfrom plans.

ConclusionThe ministry did not establish

a sound coordination strategy atthe outset of the initiative, largelybecause of the difficulties it faced incoordinating a group of ministriesover which it had no authority.

Once working agreements wereestablished, however, the ministrywas able to properly facilitate thesharing of available child careinformation. Unfortunately, theavailable information did notinclude an analysis of unmet child

care needs on a regional basis, sofunding approvals were not basedon greatest needs.

The ministry gave relevantprogress information to decision–makers, and it showed that initialproblems did not negatively affectthe outcomes of the initiative interms of cost per child care space.

FindingsEstablishing a SoundCoordination Strategy

Project objectives were clearlydefined in individual ministryTreasury Board Submissions, wheretargets for the numbers of child carespaces and costs for each spacewere spelled out. Following theacceptance of the initiative byTreasury Board, guidelines for howthe objectives were to be achievedhad to be developed.

We found that the ministryinitially tried to set guidelines forapproving applications, a step thatwould have led to consistenttreatment of applicants for each ofthe ministries. First, however, eachpartner ministry would have hadto change their existing capitalfunding processes—something theyobjected to.

After consulting with each ofthe other ministries, the Ministry ofWomen’s Equality concluded thatthere were reasonable justificationsfor applicants being treateddifferently by each ministry. Thiswas not only because of theresistance to change, but alsobecause some types of child carewere found to have unique aspectsthat required special treatment.School districts, for example, weregranted additional funds to coveradministration costs incurred inencouraging new facilities to

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provide child care on or near schoolgrounds for the Young ParentProgram.

There were no clear writtenagreements about how the Ministryof Women’s Equality was to have asay in the approval processes ofother ministries, nor was there aclear understanding of howdisagreements were to be resolved.While these differences were settledinformally, the project experiencedsome initial administrativeinefficiencies when ministry staffhad to sort out differentinterpretations about whether itwas the role of the Ministry ofWomen’s Equality to “coordinate”or “manage.” The wording of theCabinet Submission had beendrafted by the Ministry of Women’sEquality, and was open to varyinginterpretations by the agencieswanting control. As the projectprogressed and agreements were

reached, working level relationshipsimproved—with the ministrycoordinating information andmanaging project approvals.

Providing Child Care InformationGiving Priority to the Greatest Needs

One of the originalexpectations of the ministry wasthat it would provide child careinformation to help partnerministries focus funding on areas ofthe province where child care needswere greatest.

This did not happen for tworeasons. First, the ministry does nothave a comprehensive database thatcan be used to identify unmet childcare needs. Second, the partnerministries did not specificallyencourage school districts andcollege and hospital boards in areaswith the greatest need for licensedchild care to apply for funding.

Child care facilities constructed on school grounds with BC 21 funding enable young parents to continue with their studies

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We believe that both of theseproblems should be addressed bythe ministry to guide constructionof new child care facilities underany future cross–governmentinitiatives and for on–going facilitiesand equipment grants (discussedlater in this report under “IncentiveGrants for Child Care Facilities”).A child care database exists, withinformation about locations andnumbers and types of child carespaces taken from grant applicationsreceived from various child carefacilities around the province. Thisdatabase is being used to keep trackof funds given to facilities overtime. We believe that, if the ministrywere to add information thatalready exists about available childcare (location, types of care, andcapacity of licensed facilities fromthe Ministry of Health) andestimates of child care needs bygeographical location (fromprovincial child care surveys), thisdatabase could be used to identifythose parts of the province thathave the greatest need forgovernment child care funding.

After the ministry hasdetermined where the need isgreatest, it can encourageapplications from, and givepreference to, community groups inthose areas that are most deficient.

Recommendation: The ministryshould improve its child caredatabase so that it can identifyareas of the province where needsare greatest. Then it should givepreference to funding child careprojects in those areas.

Meeting Child Care Space StandardsThe amount of room needed

for each child care space variesaccording to such factors as the ageof the child (younger children cared

for all day require more space forplaying and napping, and forcaregivers to prepare meals) andthe number of children in a facility(smaller groups need the same basicrequirements as larger groups,resulting in more average spaceper child).

Child care space standardswere developed for this initiative bythe Ministry of Women’s Equalitybased on those used by the BritishColumbia Buildings Corporationand the City of Vancouver. Wefound that these child care spacerequirements varied from as low as7m2 total space for each child in agroup of 40 children in an out–of–school care program, to as much as17m2 total space for each child in agroup of 8 infant–toddlers. Weconcluded that these space standardswere reasonable, given that theywere based on those developed bytwo large government entities andthat they were not much aboveminimum acceptable space standardsrequired by the Ministry of Healthfor licensing purposes.

Because the ministry had notbeen charged with overseeing theway other ministries approved thecosts of projects, it did not questioncosts per space when giving itsapproval for individual projects.Nor, as is discussed later under“Incentive Grants for Child CareFacilities,” did the ministry haveguidelines for standard costs ofconstruction of child care spaces.Nonetheless, as auditors of publicspending, we decided to examinethe reasonableness of the averagecosts of child care spaces createdunder this initiative. To do this, wefound that it was easier to look atthe final costs incurred rather thanreview how projects were approvedat each of the individual ministries.

When we calculated individualcosts per space, we found thesecosts varied depending on the typeof construction and the size of thefacility being built. Costs per spaceranged from about $6,000 in the(former) Ministry of Education’sout–of–school programs to about$18,000 in the (former) Ministryof Skills, Training and Labour’scombined programs for infant–toddlers and pre–school agechildren. Based on the number ofsquare meters recommended in theMinistry of Women’s Equality spaceguidelines for each category ofcare, we found costs averagedapproximately $1,000 per squaremeter (or $100 per square foot).This average cost was found to beacceptable when we compared it toa generally accepted range ofcurrent replacement costs for thistype of construction.

Locating New Spaces Away From Existing Spaces

We found that the Ministry ofWomen’s Equality provided childcare information to its partnerministries on a project–by–projectbasis, reviewing applications toensure that funding would notcreate new licensed spaces thatcompeted with existing ones.

Ministry staff did this by usinglicensing information from theMinistry of Health that includedlocations, types of care provided,and the number of child care spacespermitted for each licensed facilityin the province. We believe thatthe ministry, by using this, andinformation about new spaces beingbuilt under Facilities andEquipment grants, used areasonable approach to determinewhether proposed facilities wouldcompete with existing ones.

Preparing and CommunicatingProgress Information toDecision–Makers

A communication plan wasdrafted as part of the TreasuryBoard Submission requesting fundsfor the initiative. In it, the ministrycommitted to providing decision–makers with annual progressreports. We found that, except inthe first year of the initiative, thisplan was followed.

Progress information wascollected and communicated toTreasury Board staff informally inmeetings and more formally inreports submitted at the 50% and95% completion stages. Based onour review of the processes used,we concluded that the informationproduced was complete and reliable.

In each report to TreasuryBoard, the ministry comparedactual spending with budgetedamounts, and the actual number ofchild care spaces built with targetsthat had been set by each ministry.We found that spending was inkeeping with budgeted amountsfor each ministry. The number ofspaces obtained for the moneyspent was also on target for allexcept the (former) Ministry ofEducation’s Out of School andCommunity Child Care program.Originally, $16 million allocatedfor this program was expected toproduce 6,400 spaces, yet only 2,500were created.

When we reviewed the reasonsfor this shortfall, we found that the(former) Ministry of Education hadexplained in its Treasury BoardSubmission that the 6,400 spacetarget was only tentative, based onthe assumption that school districtswould be able to find surplus spacein school buildings. We found that

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those school districts applying forfunding under this initiative made acase that, because of increasingschool enrollments, surplus spacewas in short supply. As a result,spaces were created on schoolgrounds using other means such asmodular construction, a more costlyendeavor than was originallyplanned. When we calculated thecosts of these spaces, we found that

they ranged between $3,000 and$10,000 each, amounts that comparefavorably with the range wecalculated earlier for the otherspaces produced under this initiative(permanent facilities cost from$6,000 to $18,000 for each space).

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Government’s WageRedress Strategy

The Wage Supplement Initiativeis one of several provincial programsaimed at achieving fair and equitablewages for low paid workers in thepublic sector. This initiative provideswage lifts to employees workingwith children in licensed childcare centres.

The program arose after twogovernment reports focused on thelow wages of child care workers inBritish Columbia. First, the 1991Task Force on Child Care report,Showing We Care—A Child CareStrategy for the 90’s, called for asalary enhancement strategy forchild care workers to raise staffsalaries to a level that reflects thetraining and responsibility required.Second, the report of the 1992Commission of Inquiry into thePublic Service and Public Sector(known as the Korbin Commission)acknowledged that child careworkers are among the lowest paidworkers in the social services sector,and recommended that this inequitybe addressed by a governmentlow–wage redress strategy.

In response to Korbin’srecommendations, the ministryintroduced the Wage SupplementInitiative program in January 1994.The first wage supplements tookthe form of one–time, lump sumpayments to non–profit child carecentres. Payment amounts werecalculated on the basis of an increaseof approximately $1.60 per hour foreach eligible worker employedduring the last six months of fiscal

1993/94. In all, payments totaled$3.4 million.

The program changed itsapproach in 1994/95, replacing thelump sum payments with a systemof tying contributions to actualwages. This was more in keepingwith government’s overall wageredress initiative. In addition, theprogram was expanded to includelicensed private centres and specialneeds day care staff and spendingwas increased to $7.5 million.

For 1995/96, the WageSupplement Initiative providedhourly wage increases toapproximately 5,000 child careworkers in close to 1,300 non–profitand private licensed child carecentres at a cost of approximately$13 million.

Secondary Impactsof the Wage SupplementInitiative

Low wage redress, the primarygoal of the Wage SupplementInitiative, attempts to providecomparable pay for comparablework. As well, it addresses theadequacy of wages by trying toensure that people working in thepublic sector earn enough tosupport themselves.

The ministry believes thatoffering wage supplements to childcare workers also has secondaryimpacts on the accessibility, quality,and affordability of child care.Secondary impacts are significantconsequences, either intended orunintended, that occur as a result ofa program. To assess a program’s

wage supplement initiativefor child care workers



design and operations properly,decision–makers need to be awareof a program’s secondary impacts.

One secondary impact of theWage Supplement Initiative is that itmay increase the retention of childcare workers, because higher wagesincrease the likelihood that workerswill stay in the field. This couldaffect access to child care bymaintaining the supply of workersto staff child care spaces. Access,after all, depends on the availabilityof both physical spaces and workersto care for children.

Reduced worker turnover canalso affect quality because it leads tomore consistent, continuous care,which is key to quality child care.In her 1992 commissioned report,Korbin describes the link betweenlow wages, worker turnover,and quality:

Skilled workers who are frustratedby the wage inequities in thissector frequently move to otherpublic or private sectors whenopportunities arise, therebycompromising the sector’s abilityto provide consistent qualityservices to the public.

Offering child care workershigher pay through wagesupplements has the potential to domore than reduce worker turnover;it may make child care work moreattractive, thus increasing thelikelihood that more people willbecome trained and pursue a careerin the field. While a professionalqualification such as an EarlyChildhood Education certificatedoes not guarantee quality care, itprovides a level of assurance thatcaregivers are trained to identifyand minimize risks in the child caresetting. Professional training mayalso have a positive influence on thenature of the interactions between

caregivers and children, resulting ina higher quality of care. Clearly, theministry recognizes the value of atrained, professional work force, asevidenced by its decision to spendthe majority of its resources in thelicensed child care sector.

Another secondary impact ofthe Wage Supplement Initiative isthat it may help to make child caremore affordable. Subsidizingworker wages enables child careoperators to minimize increases inparent fees—a large component ofworker wages.

Managing SpendingWe examined ministry Wage

Supplement Initiative spendingfrom April 1994 to December 1995to determine whether funds hadbeen given only to eligible agenciesaccording to approval guidelines.

ConclusionThe ministry made Wage

Supplement Initiative paymentsonly to eligible recipients and inaccordance with approvalguidelines.

FindingsDetermining Eligibility

The ministry reviews allapplications for wage supplementfunding to see if the agenciesinvolved are licensed by theMinistry of Health to provide groupchild care and if the number of staffthey are claiming for is in accordancewith the number of staff requiredunder their license. Staff also requireevidence that applicants are in goodstanding with the Registrar ofCompanies.

We tested the eligibility ofsuccessful applicants by reviewingevidence that they were licensed

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and in good standing. As a result ofour examination, we concluded thatchild care centres receiving fundsfrom April 1994 to December 1995were eligible for wage supplements.

Applying Approval GuidelinesAll regular full– and part–time

staff who work directly with thechildren as part of the regulatedchild–to–staff ratio are eligible toreceive compensation increasesunder the Wage SupplementInitiative.

Child care agencies apply tothe ministry on behalf of theirworkers. For those approved, theministry calculates worker wagesupplements based on informationsupplied on the application form,the centre’s license, hours ofoperation, and required child–to–staff ratios. Ministry staff applythis information to a wage scaledeveloped for this purpose by thePublic Sector Employers’ Councilin conjunction with the CommunitySocial Services Employers’Association. Twice a year, wagesupplements are sent to agencies,accompanied by detaileddistribution guidelines to assistchild care operators in calculatinghourly wage lifts for individualchild care workers.

We tested a representativesample of supplement paymentsand found that amounts the ministrypaid to child care agencies were allwithin spending approvalguidelines.

Upon recalculating paymentamounts, we also found that theministry paid only for the numberof staff allotted in Ministry ofHealth licensed staff–to–child ratios.In addition, wage increments wereall found to be within the range setout in the Public Sector Employers’

Council and Community SocialServices Employers’ Associationwage scale.

Managing for ResultsWe examined the ministry’s

management of performanceinformation to see if it has developedrelevant measures and is usingthem to determine the extent towhich progress is being madetoward intended goals.

ConclusionThe ministry is assessing the

extent to which Wage SupplementInitiative spending is achievingintended results. It has determinedthat funds are reaching the workersfor whom it is intended, and thatthe average wage level hasincreased as a result.

The ministry has also identifiedsecondary impacts of wagesupplements on the accessibilityand quality of child care (specificallythese are a reduction of workerturnover and an increase inworker qualifications) and on theaffordability of child care (throughsmaller parent fee increases).Although it has not yet developeda means for measuring changes inworker turnover, the ministry isdeveloping ways to collectinformation about changes inworker qualifications and has beencollecting parent fee information.

FindingsMeasuring Wage Redress Results

The goal of the ministry’s wagesupplement program is to makesure that funding is distributed toworkers according to the guidelinesestablished by the Public SectorEmployers’ Council and theCommunity Social Services



Employers’ Association. To gaugeits progress in meeting this goalthe ministry has developed twoperformance measures: individualworker wage levels and averagewage levels. Since they relatedirectly to the goal, we concludedthat both measures are relevant forthe ministry’s purpose.

The ministry has taken steps tocollect this performance information.It recently conducted a review of1994/95 payments to determinerecipient child care centre compliancewith distribution guidelines. Inorder to receive wage supplements,child care centres are required toperiodically submit statementsshowing how those funds wereactually spent. As part of its review,the ministry compared child careagency submissions withconfirmations from individualworkers who received wage lifts toensure they had received theirentitlements.

We found that the ministry’sreview and follow–up effortsdemonstrated that it is achieving itsgoal of getting wage supplementsto child care workers in thecorrect amounts.

The second performancemeasure, average worker wagelevels, has been tracked for thosereceiving wage supplements as ageneral means of assessing increasesin worker wages. Using informationin its program database, the ministryhas determined that the averagewage level of child care workersreceiving supplements went fromless than $11 per hour in 1993 to justover $14 per hour in 1996.

In future, the ministry is to beassisted in gathering performanceinformation on average workerwages by the Community SocialServices Employers’ Association,whose mandate is to assess theoverall effects of wage redress

The Wage Supplement Initiative provides wage lifts to employees who work with children in licensed child care centresin recognition of their level of training and responsibility

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on the wage levels and jobclassifications of child care workers.

Measuring Effects on Child Care

The ministry recognizes thatwage supplements probablyinfluence accessibility, quality, andaffordability of child care, and thatrelevant measures exist to gaugethese effects. However, because theprogram was not set up to achievethese goals, the ministry has not yetbegun to organize, or in some caseseven collect, the necessaryinformation to assess the long-termsecondary impacts of this programon child care.

The ministry points out thatthe program’s impacts onaccessibility, quality, andaffordability may not have far-reaching effects on the child caresystem as a whole because licensedchild care centres serve only a smallpercentage of children in day care.Also, measuring outcomes is arelatively new concept ingovernment, and the ministry needsmore time to gather and analyze therelevant data.

We believe that the ministryshould continue its efforts to collectand analyze this type ofinformation so that it can be used toassess the total impacts of thisprogram and assist decision-makersin allocating program resources.

AccessibilityWe found that the ministry is

not measuring whether the programis improving access to child care bykeeping workers from leaving thechild care field for higher payingjobs. At the moment, the ministry’smeasurement for accessibilityfocuses on the the number of

available spaces but not on whethersuitably qualified workers areavailable to staff those spaces.

QualityAttracting and keeping

qualified child care workers is alsokey to providing quality child care.The ministry has developed waysof tracking worker qualificationlevels to help measure whether theprogram is affecting the quality ofchild care by attracting workerswith higher qualifications. Onemethod of collecting data onqualifications is through theministry’s periodic Provincial ChildCare Survey. While this informationhad not been assessed before wecompleted our audit, the ministryplans to compare baseline datacollected in 1993 with results fromthe next survey, tentativelyscheduled for later in 1996.

AffordabilityAt the end of our field work,

the ministry did not know whetherthe program was helping to makechild care affordable by minimizingincreases in parent fees. However,sources on parent fee informationdo exist, such as the ProvincialChild Care Survey. The ministryshould be able to compare resultsof the upcoming 1996 survey with1993 baseline information. Anothersource is the Wage SupplementInitiative application form, whichasks how much agencies charge forchild care services. Unfortunately,this information is not in a readilyusable form. The ministry is,therefore, developing ways toreorganize and analyze thisinformation so that it can be used todetermine changes in parent fees.

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Purposes for IncentivesIn 1992/93 the ministry created

a number of child care grantprograms with the primary purposeof motivating facility operators toimprove access to quality child care,by maintaining and adding to theexisting number of licensed spaces.

The secondary purpose forthese grants is to maintainaffordability of child care. Ifoperating costs are subsidizedby government grants, facilitiesshould have a reduced need to raiseparent fees.

Types of Funding AvailableThe ministry gave out

approximately $13 million in childcare grants to approximately 1,700child care facilities between April1994 and December 1995, underfour types of grants: Infant–ToddlerIncentives; Facilities and Equipment;Emergency Repair, Replacement,and Relocation; and other needs.

Infant–ToddlerIncentive Grants

The 1991 provincial Task Forceon Child Care identified a significantshortage of licensed, quality childcare spaces for infants and toddlers.It attributed this shortage partly tothe higher cost of caring for infantsand toddlers relative to olderchildren. Younger children requiremore space per child and closersupervision. The Infant–ToddlerIncentive Grant Program wasintroduced in the fall of 1992 as anincentive for eligible licensed centresand family providers to providecare for infants and toddlers.

Infant–Toddler Incentives fromApril 1994 to December 1995 totaled$7.1 million ($4.8 million in 1994/95,and $2.3 million from April toDecember 1995).

Facilities andEquipment Grants

The Facilities and EquipmentGrant Program helps respond to theneed for more licensed child carespaces. Grants of up to $500,000 areavailable to non–profit societies andlocal governments to purchase,renovate, and expand or constructlicensed child care facilities, or topurchase furnishings and equipmentfor new or expanded facilities. Toqualify for this grant, non–profitagencies must raise at least 50% ofthe money needed through fund–raising efforts of their own.

Facilities and Equipmentpurchases totaled $3.7 millionfrom April 1994 to December 1995($2.3 million in 1994/95, and$1.4 million from April toDecember 1995).

Emergency Repair,Replacement, and Relocation Grants

Emergency Repair,Replacement, and Relocation grantshelp licensed, non–profit child carecentres meet provincial health andsafety regulations for child care.Grants of up to $5,000 are availableto help centres adequately maintaintheir facilities and equipmentand meet the costs of sudden,unanticipated relocation costs.

Examples of improvementsfunded over the past year include:

incentive grants for child care facilities

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installation of safety glass,replacement of hazardousequipment, purchase of appliancesthat meet health standards, roofand water main repairs, andcreation of bike paths andadventure playgrounds.

Emergency Repairs,Replacements, and Relocationpurchases totaled $1.7 millionfrom April 1994 to December 1995($1.0 million in 1994/95, and$0.7 million from April toDecember 1995).

Other GrantsDuring 1994/95, the ministry

also approved grants of up to$10,000 to applicants who couldshow that they had developedviable projects aimed at assessingor providing for unmet child careneeds, or at demonstrating newmodels for delivering existingservices. Total spending for 1994/95was $400,000. This funding was notavailable for 1995/96.

Managing SpendingWe examined the ministry’s

management of grant spendingfrom April 1994 to December 1995to see if recipients met eligibilitycriteria, and if payments were madeonly for approved purposes.

ConclusionThe ministry made Child Care

Grant payments only to eligiblerecipients and in accordance withapproval guidelines. Approvalguidelines for most grants werefound to be comprehensive, butconstruction grant guidelines didnot include standard costs. Althoughthis did not result in overspendingfor the period under review,acceptable ranges for costs per

space are needed to assist theministry in setting measurable goalsand to optimize the benefits fromfuture spending.


The ministry has developeda set of eligibility criteria thatfacilities must meet before they canreceive any money under each of itsgrant programs. Applications arethen reviewed to determine whetherthese guidelines have been met. Insome cases, like the Infant–Toddlergrants, all eligible applicants receivefunding. In others, like the Facilitiesand Equipment grants, applicationsare ranked according to ministrychild care priorities and thenavailable funding is distributedstarting at the top of the list.

We examined a representativesample for each program and foundthat, for the money given outbetween April 1994 and December1995, all of the recipients wereeligible and that ranking processeswere properly used.

Applying Approval GuidelinesFor each program, applicants

are reimbursed based on ministrydecisions about whether theexpenditures in question meetapproval guidelines. Theseguidelines apply to both the amountand type of expenditure incurred.We found that limits for the types ofexpenditures to be approved wereclearly spelled out and followed forall grant programs.

Limits for the dollar amountsfor grants were clear for someprograms. For Infant–ToddlerIncentive grants, standard dollaramounts are paid, based on the



location of care (a centre or a homesetting) and the number of hoursof care. For Emergency Repair,Replacement, and Relocation grants,there is some standardizationthrough the use of an individualceiling of $5,000 for each recipient.Also, independent cost quotes mustaccompany applications. Theserequirements help to limit cost perchild care space, and we foundthat they were adhered to forgrants issued during the periodunder audit.

However, for the ministry’sFacilities and Equipment grants, wefound that limits were set only forthe total amount to be funded,namely $500,000 for each projectundertaken. As discussed earlierunder “Coordination of Informationfor the BC 21 Child Care ExpansionInitiative,” the ministry had notdeveloped any standards for costs

per space. Indeed it expectedagencies applying for funds tocreate the most spaces possible,since more spaces can translate intohigher revenues for them.

Upon examining actualspending for these grants, we foundthat most projects resulted in costsper space that ranged from $3,000(for renovations) to $10,000 (for newconstruction). After considering theaverage square meter requirementsfor each space and the generallyaccepted building costs per squaremeter (discussed earlier under“Coordinating Information for theBC 21 Child Care ExpansionInitiative”), we concluded that thelack of standard costs had not led tomisspending. However, we believethat developing standard costswould be a straight–forward task.These would not only help theministry to ensure that child care

Hanna Court Children’s Centre in Burnaby was built with Facilities and Equipment Grant funding

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spending is achieving themaximum number of spacespossible, but they would alsoenable it to develop measurablegoals for the number of spaces to bebuilt with available funding. Theneed for measurable goals isdiscussed in the next section.


management of performanceinformation to see if it has developedrelevant measures and is usingthem to determine the extent towhich progress is being madetoward intended goals.

ConclusionThe ministry has determined

that it is continuing to meet its goalof increasing access for types ofchild care that have been identifiedas priorities, that is: for infants andtoddlers, rural locations, and out–of–school care. It has not, however,determined the extent to whichthere is still unmet need for thesetypes of care, in general and fordifferent parts of the province. Theministry also does not specify thenumber of child care spaces it isaiming to create or maintain withassigned resources. Without anindication of unmet needs or specificgoals to address these needs, it isdifficult to assess the results ofministry efforts. Concerning its goalof improving the affordability ofchild care related to parent fees, theministry does not have sufficientinformation to assess the impact ofits spending.

FindingsMeasuring Changes in Accessibility of Child Care

The ministry has developedthree program goals related toaccessibility: creating new child carespaces; maintaining existing spacesthat would otherwise close; andencouraging types of child care thatare deficient (for example, infant–toddler care). We found that theministry assesses its performanceby counting the number of childcare spaces created or retained ona project–by–project basis, anddetermines annual totals for eachprogram. We concluded that thenumber of spaces is a relevantmeasure to use in assessing resultsof ministry efforts.

Provincial priorities for thetypes of child care to fund aredetermined with the input of theinter–ministry Child Care PolicyTeam and the Provincial ChildCare Council. In 1991 and 1993,the ministry also conducted aProvincial Child Care Survey toassess, among other things, thelevel of demand for child care. Itplans to conduct another survey in1996. The ministry’s approach toallocating funding has been drivenby information collected in itssurveys, as well as by individualcommunity efforts to identify needsand raise funds to match withprovincial grants. We found thatdue consideration had been givento these priorities when it came toallocating grant money amongapplicants.

For individual Infant–Toddlerand Emergency Repair, Replacement,and Relocation grants the ministryhas established spending limits thatcan be used to set measurable goalsfor the number of child care spaces



that can be maintained withavailable funding. However, forFacilities and Equipment grants, theministry does not set targets for thenumber of spaces that will becreated or assisted. It simply pointsto annual increases in the number ofavailable child care spaces as anindication of how it is improvingaccess to child care.

We believe that what is neededto measure and assess performancebetter for Facilities and Equipmentgrants is some indication of theoptimum number of spaces thatcould be created with the resourcesexpended. This target could then becompared with actual achievementsto see whether results of programefforts are acceptable or need to beimproved. However, as discussed inthe previous section, determiningthe optimum number of spacesrequires the setting of standard costguidelines, which the ministry hasnot done.

To estimate the number of childcare spaces that can be created withavailable funding, the ministryneeds to develop standard costs.This should put it in a betterposition to set measurable goalsand, ultimately, to assess itsprogress toward meeting them.

Recommendation: The ministryneeds to develop standard costs foruse in setting measurable goals forcreating new child care spaces.

Measuring Changes in Affordability of Child Care

We found that the ministryuses the average level of parent feesto track progress toward its goal ofminimizing parent fee increases. Weconcluded that parent fee levels is arelevant measure to use in assessingthe impact of ministry spending.

As part of its 1993 ProvincialChild Care Survey, the ministrybegan to collect information aboutparent fees for licensed child carethroughout the province. It has alsocollected parent fee informationfrom Wage Supplement Initiativeapplicants, who are in the licensedchild care sector, but the data hasnot been organized or analyzedin a systematic way. Ministrymanagement has assured us that, inthe Provincial Child Care Surveyplanned for 1996, the ministry willbe collecting follow–up informationabout parent fee levels andcomparing it to 1993 figures. Thetrend information about parent feeson a geographic basis that will beproduced should be useful inhelping the ministry focus itsspending and set measurable goals.

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Supporting Child Careat the Local Level

Child Care Support Programagencies provide caregivers andparents across British Columbiawith training and support for childcare at the local level. Caregivers inthe licensed and license–not–required sectors can get information,training, and support in deliveringquality child care; parents lookingfor child care can access a resourceand referral service on child carechoices available in theircommunities.

The province has supportedthese types of services for over sixyears, beginning in 1990 whenthe Ministry of Social Servicesestablished the Family Day CareSupport Program and contractedwith 24 community non–profitsocieties to provide the services.In 1992/93, the program wastransferred to the Ministry ofWomen’s Equality. At that time, theprogram consisted of 31 agenciesand $2.5 million in spending. In1994/95, as part of the federal–provincial Child Care StrategicInitiative Project, the number ofcontracted agencies was expandedto 34 and spending increased to$3.9 million. Spending increasedagain in 1995/96 to $4.7 million.

British Columbia’s 34 ChildCare Support Program agenciesprovide assistance to parents andcaregivers in over 140 communities.Approximately 25% of the 4,800facilities registered with thisprogram provide informal care forwhich a child care license is not

required (this being the onlyministry funding available for theunlicensed child care sector); about30% are licensed group child carefacilities; and 45% are licensedfamily child care situations.

The agencies in this programare operated by local non–profitsocieties through continuous servicecontracts to the ministry. While allChild Care Support Programagencies provide a core set ofservices, individual agencies mayprovide additional services inresponse to community needs andavailable resources.

Child Care SupportProgram Services

Agencies under the Child CareSupport Program serve two keypurposes in assisting the ministry tofulfill its mandate. First, they helpto improve the quality of child careby providing information tocaregivers through child caretraining courses and one–on–oneconsultations. Second, they help toimprove the accessibility of childcare by maintaining a caregiverregistry that provides informationto parents about child care optionsin their community.

Managing SpendingWe examined ministry Child

Care Support Program spendingfrom April 1994 to December 1995to determine whether funds hadbeen given only to eligible agenciesand according to approvalguidelines.

child care support program forcaregivers and parents



ConclusionThe ministry made Child Care

Support Program payments only toeligible recipients and in accordancewith approval guidelines.


We found that all Child CareSupport Program agencies receivingfunds from April 1994 to December1995 were eligible for funding;that is, they had undergone localtendering or communitydevelopment processes and werenon–profit societies in goodstanding with the Registrar ofCompanies. For those that aresuccessful in gaining program status,the ministry enters into an annualcontract to pay for specified services.

We examined the contractedarrangements for a representativesample of Child Care SupportProgram agencies and found thatthey had been adequately screenedfor eligibility.

Applying Approval GuidelinesWe examined all major

payments, and a representativesample of smaller ones, made toChild Care Support Programagencies receiving funds from April1994 to December 1995. Based onthis, we were able to conclude thatamounts to program agencies werepaid in accordance with spendingguidelines in approved contracts.

We also found the ministry’sprocesses for determining whetheragency services are delivered ascontracted to be acceptable. Ministrystaff scrutinize agency annual workplans and budget submissions andreview reports on prior yearachievements to see that contract

services are delivered as agreed.Staff also maintain on–going contactwith agencies which enables themto identify and address problemsthat may arise.

As well, the ministry hasperiodically conducted in–depthreviews of individual agenciescontracted under the program. In1993, for example, the ministryparticipated in an internal audit ofthe service contracts of four agenciesit had identified as having problems.We found that the ministry hadtaken action to address all theproblem areas identified by the audit.


management of performanceinformation to see if it has developedrelevant measures and is usingthem to determine the extent towhich progress is being made towardintended goals.

ConclusionThe ministry has developed

and is using performance measuresdesigned to assess whether ChildCare Support Program agencies aredelivering services as contracted.Although this type of performancemeasurement is vital, it should beextended to include measuringwhether the services are achievingwhat was intended. The ministry isaware of this and has begun to lookfor ways to assess the results ofdelivering services. We believe thatthe ministry’s initial pilot efforts todo this are a good start, but proposethat performance measures beextended to include those that focuson actual changes in quality andaccessibility of child care.

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FindingsMeasuring Changes in Quality and Accessibility

One goal of the Child CareSupport Program is to improve thequality of child care in the provinceby providing information andtraining to caregivers. Another goalis to improve the accessibility ofchild care by giving parents referralinformation and support.

To assess its performance inmeeting both of these goals, theministry has developed a numberof measures that logically relate toquality and access. These measures,designed for monitoring thecontracts of program agencies, focuson whether services have beendelivered as contracted. In otherwords, the ministry is measuringprogram outputs (Exhibit 7).

One quality–related outputcurrently being tracked by theministry, for example, is the numberof caregiver training coursesdelivered. A correspondingaccessibility–related output is thenumber of home visits to recruitcaregivers for the registry that isused to refer parents seeking childcare arrangements.

This is a reasonable place tostart in collecting information onprogram results. However, we donot think the ministry will be ableto assess properly its progresstoward meeting its goals to improvequality and accessibility until theseindicators are extended to focusmore on outcomes (Exhibits 7 and 8).For example, the immediateoutcome of a program output—such as a home visit—may be that anew caregiver is recruited for thechild care registry. A longer–term

Child Care Support Programs provide caregivers with information, training, and support in delivering qualitychild care

Cour

tesy

: Min

istr

y of

Wom

en’s

Equ

ality



outcome could be that, by recruitingmore caregivers for the registry,parent access to child care isimproved.

We recognize that developingoutcome measures can bechallenging, due in part to thesometimes tenuous link betweenprogram activities and programimpacts and the difficulty ofmeasuring qualitative aspects. Inlight of this, output measures canbe useful as indirect measures ofresults. However, they are onlyreliable to the extent that theoutputs logically lead to the desiredresults. At the end of the day, it ison the basis of results, or outcomes,that the success of the program isjudged by legislators and the public.

We found that the ministry istaking steps to shift from measuringoutputs to assessing outcomes aspart of its evaluation of the federal–provincial Child Care StrategicInitiative pilot project. The ministryChild Care Support Programcoordinator has been working withStrategic Initiatives evaluators to

develop tools for monitoring andevaluating this program. In thecoming months, the ministry plansto assess how well it is doing inmeeting the needs of caregiversand parents. This will be done bycollecting data from caregiversand parents about their usage ofagency services.

We believe that the ministryis headed in the right direction.Following its pilot evaluation wethink it should examine how toapply each of its performancemeasures to the rest of the agenciesin the program. We also think that itcan go further toward measuringthe outcomes (Exhibit 8) of itsprogram efforts—from how well itis meeting caregiver and parentneeds to how much of an effecttraining and referrals are having onquality and accessibility of child care.

It may be reasonable to assumethat caregivers who are assisted tomeet licensing standards, or whoreceive training on how to improvethe quality of care they provide, arelikely to change their behavior

outputs — measurable direct results of activities, such as products or services provided

outcomes — measurable consequences of a program’s outputs and impacts on the client or thepublic, and the results of the impacts

performance measure — a statement specifying a desired output, outcome, or event that isexpected to occur; the “what” that is to be measured

performance goal — the target level of performance expressed as a tangible, measurableobjective, against which actual achievement can be compared, including a goal expressed as aquantitative standard, value, or rate

Source: Based on wording used in Enhancing Accountability for Performance: A Framework and Implementation Plan, second jointreport by the Auditor General and the Deputy Ministers’ Council of British Columbia, 1996

Exhibit 7Performance MeasurementDefinitions

42



accordingly. However, we believethat measuring the increased numberof licensed caregivers and theincreased use of training resourcesshould be supplemented with sometype of follow–up to determinewhether the quality of caregiverinteraction with children hasimproved. Similarly, for assessingthe extent to which this programimproves access to child care, theministry should find a way todetermine whether increases in the

number of registered caregivers,and parent referrals to thosecaregivers, are leading to parentsfinding suitable child careplacements.

Recommendation: The ministryshould extend its performancemeasurement to assess the effects ofprogram efforts on quality andaccessibility of child care.

EXISTING OUTPUT MEASURES PROPOSED OUTCOME MEASURES

Source: Based on information provided by the Ministry of Women’s Equality

n number of caregiver training courses delivered

n number of licensed facilities

n number of home visits to recruit caregivers

n number of caregivers registered with the CCSP

n number of parents seeking child care referrals

n % of caregivers attending courses

n changes in caregiver quality–related behaviorresulting from attending training courses

n caregiver opinions about the usefulness oftraining courses in teaching how toprovide quality child care

n number of caregivers who have becomelicensed following registration withthe CCSP

n number of registrations resulting from visits

n % of caregivers in a community registeredwith the CCSP

n % of parents seeking child care whoreceived referrals

n parent opinions about the usefulness ofreferrals in finding suitable child care

Exhibit 8Transforming Output Measures Into Outcome MeasuresExamples of measures for the Child Care Support Program (CCSP)

Goal: To Improve Quality of Child Care

Goal: To Improve Accessibility of Child Care



The Ministry of Women’s Equalityappreciates the Office of the AuditorGeneral’s (OAG) Special PerformanceAudit Report on the management ofChild Care in British Columbia. Theaudit was conducted in a very professionaland open manner. The audit reportsuccessfully describes the functions of theprovince’s child care programs for whichthe ministry is responsible.

It is our belief that a review suchas this is fundamental to verify thatappropriate policies and controls are inplace within an organization thatmanages millions of dollars paid toindividuals and agencies throughout theprovince. This report provides furthercredibility and confidence in the province’smanagement of child care spending.

We are certainly pleased that theOAG concluded that the ministry ismanaging spending “with due regard forstated priorities for the types of care andonly to eligible recipients in accordancewith approved guidelines.”

The ministry does recognize thatthere is always room for improvement inmanaging for results. In some cases (eg.working with the Community SocialService Employers Association to gatherperformance information on averageworker wages to assist with assessing theoverall effects of wage redress on wagelevels) we are in the process of addressingthe audit observations.

With regard to the three specificrecommendations in the report, theministry has the following comments:

Recommendation 1: The ministry shouldimprove its child care database so that itcan identify areas of the province whereneeds are greatest. Then it should givepreference to funding child care projectsin those areas.

The ministry supports thisrecommendation and is currentlyworking on the development of animproved Child Care ManagementInformation system. This new system isintended to:

– improve accountability of the ChildCare Branch, both to the people ofBritish Columbia and to theGovernment of the Province;

– provide a method to measure andcompare program outputs to goals andobjectives;

– enhance the ability of programmanagers to make informed decisionsregarding the allocations of finiteresources;

– provide a framework to monitor andevaluate program effectiveness; and

– provide better access to informationpursuant to the Freedom ofInformation Act.

The introduction of this datamanagement system will greatly enhancethe ministry’s ability to track expendituresacross programs and service areas on aregional basis and assist in assessingoverall equity of expenditures by region.As well, the ministry is undertaking afollow–up to the 1991 and 1993 ProvincialChild Care Surveys which will continueto build the Ministry data base on thestatus of licensed facilities in the provinceincluding such information as current

ministry response

44



unmet need identified through waitinglists and other information provided bylicensed facilities regarding their abilityto meet community needs in the deliveryof child care services. In addition, theministry is undertaking a Survey ofChild Care Needs of British ColumbiaParents as a follow–up to data collectedin the 1988 Canadian National ChildCare Study on parents’ child care needs.All of the above noted initiatives shouldsubstantially enhance the ministry’sability to respond to the areas of greatestidentified need.

Recommendation 2: The ministry needsto develop standard costs for use insetting measurable goals for creating newchild care spaces.

Through the BC21 evaluation, theministry has determined the average costof developing new child care spaces inpublic institutions. To generalize thisstandard costing beyond this is notconsidered feasible as the cost variancedepending on location, renovation versusnew building space, stand alone facilityversus inclusion in new multipurposebuildings, type of facility and age ofchildren to be served, etc. would besubstantial. To account for the level ofvariance would make standard costingtoo complex to administer with anydegree of certainty that the standard costsproposed were reflective of the actualcosts in the long term.

Recommendation 3: The ministry shouldextend its performance measurement toassess the effects of program efforts onquality and accessibility of child care.

The ministry supports thisrecommendation. The ministry alsorecognizes the significant challengesinherent in extending its performancemeasurements to assess the effects ofprogram efforts on quality and

accessibility. In order to assess theseeffects, it would be necessary to havestandard measures of quality againstwhich services would be regularly“tested” to determine if there is overallmaintenance or improvement in qualityover time. As well, assessing accessibilitycan only be done by regularly surveyingparents to determine if they have accessto the child care services they require.As parents’ requirements for child careincludes over 24 hour periods, 7 days aweek for children age 0–12 years, thesurvey must be detailed enough toaccurately capture the wide range ofneeds. In both cases, the level ofgovernment involvement in informationgathering from service providers andparents may be too intrusive.

While the OAG report is aconfirmation that child care spending ismanaged prudently, we will continue tomove forward. It is therefore our intentto address the remaining issues raised inthe report.

We would like to extend our thanksto the staff of the OAG responsible forthis report and for their diligent andprofessional approach in reviewing thisvery important social policy function.

appendix

45

Office of theAuditor General: Audit Objectivesand Methodology

Audit work performed by theOffice of the Auditor General fallsinto three broad categories:

n Financial auditing;

n Performance auditing; and

n Compliance auditing.

Each of these categories hascertain objectives that are expectedto be achieved, and each employsa particular methodology to reachthose objectives. The following is abrief outline of the objectives andmethodology applied by the Officefor performance auditing.

Performance AuditingPurpose of Performance Audits

Performance audits look athow organizations have givenattention to economy, efficiencyand effectiveness.

The concept of performanceauditing, also known as value–for–money auditing, is based on twoprinciples. The first is that publicbusiness should be conducted in away that makes the best possibleuse of public funds. The second isthat people who conduct publicbusiness should be held accountablefor the prudent and effectivemanagement of the resourcesentrusted to them.

The Nature of Performance AuditsAn audit has been defined as:

. . . the independent, objectiveassessment of the fairness ofmanagement’s representations on

performance, or the assessment ofmanagement systems and practices,against criteria, reported to agoverning body or others withsimilar responsibilities.

This definition recognizes thatthere are two primary forms ofreporting used in performanceauditing. The first—referred toas attestation reporting—is theprovision of audit opinions onreports that contain representationsby management on mattersof economy, efficiency andeffectiveness.

The second—referred to asdirect reporting—is the provisionof more than just auditor’s opinions.In the absence of representationsby management on mattersof economy, efficiency andeffectiveness, auditors, to fulfilltheir mandates, gather essentialinformation with respect tomanagement’s regard for value formoney and include it in their ownreports along with their opinions. Ineffect, the audit report becomes apartial substitute for informationthat might otherwise be providedby management on how they havedischarged their essential value–for–money responsibilities.

The attestation reportingapproach to performance auditinghas not been used yet in BritishColumbia because the organizationswe audit have not been providingcomprehensive managementrepresentations on theirperformance. Indeed, until recently,the management representationsapproach to value for moneywas not practicable. The need toaccount for the prudent use oftaxpayers’ money had not beenrecognized as a significant issue



appendix

and, consequently, there wasneither legislation nor establishedtradition that required publicsector managers to report on asystematic basis as to whetherthey had spent taxpayers’ moneywisely. In addition, there was nogenerally accepted way of reportingon the value–for–money aspects ofperformance.

Recently, however,considerable effort has beendevoted to developing acceptableframeworks to underlie managementreports on value–for– moneyperformance, and public sectororganizations have begun to exploreways of reporting onvalue–for–money performancethrough managementrepresentations. We believe thatmanagement representations andattestation reporting are thepreferred way of meetingaccountability responsibilities andare actively encouraging the use ofthis model in the British Columbiapublic sector.

Presently, though, all of ourperformance audits are conductedusing the direct reporting model,therefore, the description thatfollows explains that model.

Our performance auditsare not designed to questiongovernment policies. Nor do theyassess program effectiveness.The Auditor General Act directs theAuditor General to assess whetherthe programs implemented toachieve government policies arebeing administered economicallyand efficiently. Our performanceaudits also evaluate whethermembers of the LegislativeAssembly and the public areprovided with appropriateaccountability information aboutgovernment programs.

When undertaking performanceaudits, auditors can look either atresults, to determine whether valuefor money is actually achieved, orat managements’ processes, todetermine whether those processesshould ensure that value is receivedfor money spent.

Neither approach alone cananswer all the legitimate questionsof legislators and the public,particularly if problems are foundduring the audit. If the auditorassesses results and finds value formoney has not been achieved, thenatural questions are “Why didthis happen?” and “How can weprevent it from happening infuture?” These are questions thatcan only be answered by looking atthe process. On the other hand, ifthe auditor looks at the process andfinds weaknesses, the question thatarises is “Do these weaknessesresult in less than best value beingachieved?” This can only beanswered by looking at results.

We try, therefore, to combineboth approaches wherever we can.However, as acceptable resultsinformation and criteria are oftennot available, our performanceaudit work frequently concentrateson managements’ processes forachieving value for money.

We seek to provide fair,independent assessments ofthe quality of governmentadministration. We conduct ouraudits in a way that enables us toprovide positive assessments wherethey are warranted. Where wecannot provide such assessments,we report the reasons for ourreservations. Throughout ouraudits, we look for opportunitiesto improve governmentadministration.

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Audit SelectionWe select for audit either

programs or functions administeredby a specific ministry or publicbody, or cross–governmentprograms or functions that applyto many government entities. Thereare a large number of such programsand functions throughoutgovernment. We examine the largerand more significant ones on acyclical basis.

We believe that performanceaudits conducted using the directreporting approach should beundertaken on a five– to six–yearcycle so that members of theLegislative Assembly and thepublic receive assessments of allsignificant government operationsover a reasonable time period.Because of limited resources, wehave not been able to achieve thisschedule.

Our Audit ProcessWe carry out these audits in

accordance with the value–for–money auditing standardsestablished by the CanadianInstitute of Chartered Accountants.

One of these standards requiresthat the “person or persons carryingout the examination possess theknowledge and competencenecessary to fulfill the requirementsof the particular audit.” In order tomeet this standard, we employprofessionals with training andexperience in a variety of fields.These professionals are engagedfull–time in the conduct ofperformance audits. In addition, weoften supplement the knowledgeand competence of our own staff byengaging one or more consultants,who have expertise in the subject ofthat particular audit, to be part ofthe audit team.

As performance audits, likeall audits, involve a comparisonof actual performance against astandard of performance, the CICAprescribes standards as to thesetting of appropriate performancestandards or audit criteria. Inestablishing the criteria, we do notdemand theoretical perfection frompublic sector managers. Rather, weseek to reflect what we believe to bethe reasonable expectations oflegislators and the public. TheCICA standards also cover thenature and extent of evidence thatshould be obtained to support thecontent of the auditor’s report, and,as well, address the reporting of theresults of the audit.



Compiled and typeset by the Office of the Auditor General of British Columbiaand published by the Queen’s Printer for British Columbia©

Victoria 1996

of british columbia · victoria, british columbia september 1996. 3 highlights. 1996/97 report 1:...

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