Suzie is right in her guesses. They didn't say in any of the reports I read, but these are the most likely options.

Fraud in daycare is big business in Quebec. In 2009, the Minister for the Famillies in QC, Tony Tomassi was giving out daycare licences in exchange for money. He plead guilty and was sentenced to community service last year.

In Quebec, a daycare center or a home daycare provider has two options. Be subsidized or not. If they choose the subsidy, the parents pay the $7.30/day and the daycare gets the rest of the cost in subsidy. (Centers get about $60/day, we HCPs get close to $28.) Subsidized HCPs are also unionized so this amount is set in our contract.

If the daycare choses to be not subsidized, they can still get a licence and be "recognized." Theoretically they get inspected by the gov't. but receive no money from the government, just fees from parents. This is where the fraud comes in. Parents who use a private daycare at full fee are eligible for a refund at the end of each month for most of their daycare fees. The amount of the refund is dependant on the parent's income, but can easily work out to the parents paying less than they would in the subsidized system. Getting the right tax receipt can be worth a lot.

Just as an FYI, a person who wants the do daycare in their house, can be completely legal without being "recognized" (licenced) and subsidized as long as there are 6 or fewer children. If she wants to have more, she has to be recognized. We can have up to 9 under 5yo. I have 6 spaces and 2 of them are allowed to be 18mths and under. I work by myself. If I went to 9 children, I would have to have an assistant and 4 kids could be under 18mths. Just recently, the government backed down on the provider's kids issue, too. We are now allowed to have a full daycare and our own kids (school aged - over 5yo) in the house at the same time as long as there is a separate adult looking after the provider's kids. Potentially, a lot of people in the house!