... here is an example of how some govt programs and/or the recipients can cripple a business. A local daycare center closed it's doors suddenly and shockingly on Friday June 25 2010 with no notice other than a letter saying they were closing at the end of that day - handed out to parents when they picked up their children. The largest center in town. You can imagine the panic for working parents who had only 2 days to find a new spot.
Govt funding is not the only reason the center closed, as our newspaper and rumors I've heard on the grapevine have told me (court cases involving former staff/wages). But in today's paper, the CEO informed readers of another problem - subsidized parents not getting their forms in on time and the business losing a great deal of money. TWO THIRDS of those parents did not do their forms on time. holy cow...
Anyway here is how it works. If a parent approaches us for care starting July 2010, they pick up our registration forms along with a form to take to the govt office stating we have a space for their child. Then the parent is supposed to fill out a subsidy application and hand it in. Meanwhile, we look after their child each and every day and sit and wait for payment. The end of July comes and we submit paperwork showing that the child was there the correct amount of hours to receive full subsidy. Sounds fine right?
But if the parent did not take the forms in, we do not get paid for the whole month of July. Yes technically then the parent owes us the $600, but since they are low income, they can't or won't pay. Bingo bango - the center is out money and we have already provided childcare for an entire month. This happens a lot, with multiple children.
Currently there is really no way around this. We have filed with Small Claims court in the past, only to be told there were so many creditors on the list ahead of us, we were pretty much out of luck collecting the money we were owed. If this happens with multiple families at the same time, the center is often out the same amount of money that pays one staff member's entire wage. The bigger the center, the more possible it will be multiple staff members' wages that the center is short. It is very difficult.
And it ticks me off to no end! We have to take subsidized children or we could face discrimination lawsuits. There are a lot of subsidized parents who do all the paperwork on time and things flow smoothly, but there are too many who do not!
It angers me because this is a tax payer funded program that is supposedly going to help families get out of their poverty hole. In my center, if a family qualifies for full subsidy, they only have to pay $84 out of their own pocket for full time, monday to friday all day, childcare. WOW. What a bonus that is! That's less than $1/hour. However --- they really don't even pay that because they get $100 a month for each child under 6 from the federal Universal Child Care Benefit program so really, the govt is paying these families $16 a month to put their kids in my center, with no money coming from their own pocket at all. But then - we don't find out until the end of the month that the parent didn't bother to file the papers.
My boss calls the provincial building all the time to check up on parents, and then tells them they HAVE to get those forms in, by writing letters and speaking directly to them. We get 'Im taking them downtown tomorrow' ALL the time. But it never happens. The next thing you know, the parent buggers off at the end of the month and we are out $$$. Who can run a business like that?
We can't really say that a child cannot start until the papers are filed because the office can lag and take a week or more to get it approved, longer if the parent made a mistake and did not fill it in properly. The child is supposed to be at our center so that they fill the 100 hour minimum for full subsidy. Do you see where this is confusing? It makes us not want to take any subsidized kids, we've lost SO much money over the years... but that would be discriminatory against all low income families and that cannot be allowed either. *Sigh*.
So here we are, with the largest center in town losing a minimum of $15,000 a month (that's 10% of projected income) due to parents not filling out forms on time. They were open around 30 years and you can imagine the debt the center had to swallow in that time. It does not surprise me in the least that they finally went under. And I know that my own boss at another center has taken out small loans and paid us with her credit card in the past because not enough parents paid on time or the govt funding we did get was late....
This is just one small example of how people want help, but they don't want to do anything to get it. They think it's too hard to fill out forms and provide a copy of their tax return in order to get given $550 a month from tax payers. EXCUSE ME? They are being handed money to help them out, but they can't be bothered to file a 3-4 page form. It drives me crazy. I was subsidized in the past, I've filled out the forms, they can be a pain in the butt, but it's even easier now... so why aren't they doing it? I wonder how many other social programs go through this muck and waste time and energy and cause lost wages for businesses/groups that are trying to help out.