City's Office of the Auditor General completes audit of the Red Hill Family Centre

HAMILTON, ON – The City of Hamilton’s Office of the Auditor General (OAG) performed a value-for-money audit of the City-operated Red Hill Family Centre and found no conclusive evidence to suggest that outsourcing would be materially beneficial from a value for money perspective. 

The OAG undertook the audit following an Ontario Ministry of Education directive for all municipalities that have a directly operated child care centre. The Province’s purpose of the value-for-money audit was to determine whether federal and provincial funding is being used efficiently and effectively by directly operated centres, and whether the child care services could be more efficiently offered instead by a third-party provider.

The audit found that Red Hill Family Centre operates at a higher relative cost than similar operators, driven primarily by salaries and benefits which account for 88 per cent of annual expenses. Higher hourly wage rates, a high proportion (100 per cent) of Registered Early Childhood Educators, dedicated special needs resources, and employee benefits differentiate Red Hill Family Centre from other child care operators.

The audit also found that the Red Hill Family Centre performs well on some performance measures, exceeding their peers, with improvement opportunities available to them in certain areas.

The OAG made 14 recommendations to management for improvement, with management agreeing with all of them.

“Our audit recommendations provide the Red Hill Family Centre with a path forward to improve their operations and performance measurement practices,” said Charles Brown, Auditor General. “While there is no conclusive evidence to suggest the Centre’s operations should be outsourced to a third party, addressing our recommendations can provide residents and the City with the best value for money in its investments into the Red Hill Family Centre, and the programming and care it provides.”

• The Red Hill Family Centre provides child care to 93 children between zero and six years old annually at an average annual cost between 2019 and 2023 of $2.4 million. A team of 16 educators oversees 30 toddlers (ages 18 to 30 months) and 63 preschoolers (ages 30 months to 6 years) from 7:30 am to 5:30 pm, Monday through Friday.
• The Red Hill Family Centre is the only municipally-operated child care centre in Hamilton. Overall, there are 16 municipalities, including the City of Hamilton, operating 109 child care centres in the province.