A study into the system of subsidised childcare in Quebec, available to all parents at a cost of $7 a day, found that children and parents were 'worse off' under the programme.
However, it concluded that the economic and other long-term gains from having two parents working may offset the stress of daycare arrangements.
The number of children in daycare in Quebec has risen by 51 per cent since the highly popular scheme started in 1997. The proportion of working mothers in Quebec has also increased by 21 per cent, more than double the figure for the rest of Canada.
The report by C D Howe, an economic and social policy thinktank, looked at the impact of the programme on 'work choices, family functioning and children's well-being' using data from a national longitudinal survey of 33,000 children.
The outcomes of children aged two to four in Quebec were compared with those of children in other areas, before and after universal childcare was introduced.
The study found that aggression in Quebec children increased by 34 per cent compared with 12 per cent elsewhere in Canada, and their anxiety rose by 24 per cent compared with 1 per cent for the rest of the country.
'For almost every measure we find the increased use of childcare associated with a decrease in their well-being relative to other children. For example, reported fighting and other measures of aggressive behaviour increased substantially,' the report said.
Mothers of children in daycare were also more depressed and the quality of their parenting practices declined.
The findings of the Canadian study echo those of the National Institute for Child Health and Human Development Study of Early Child Care that tracks the development of 1,300 children in nurseries in the US. It also found evidence that children in daycare had a higher risk of becoming 'disobedient' and 'aggressive'.
The report can be seen at www.cdhowe.org/pdf/ebrief_25_english.pdf.
