Last week, in his first policy pronouncement as leader of the Conservative Opposition in Ottawa, Andrew Scheer proposed a minor non-refundable tax credit for new parents drawing Employment Insurance benefits. It was a flashback to the ineffective and discriminatory fiscal ideas that dominated the Harper years in government.
The Harper government created an incoherent hodgepodge of boutique tax credits. They each typically helped only a small sliver of Canadians and were often skewed against lower income earners. As well, since a tax credit is calculated only once a year at tax time, any benefits were always late and after-the-fact.
The same is true of this latest Conservative suggestion. Its design excludes those on the lowest incomes who need help the most – most farmers, small business people and the self-employed are also apparently left out. And the benefit would come only once a year, while the need is monthly and ongoing.
Mr. Scheer’s proposal is also amazingly timid. It pales in comparison to the new Canada Child Benefit (CCB) which our government introduced in 2016 and is now enhancing.
The CCB was created by rolling together an unruly collection of previous programs for families and children (all with different eligibilities, application procedures and tax treatments). We have made it all much simpler, added some additional federal funding, targeted benefits in proportion to family needs, stopped payments to millionaires, and made the whole package tax-free and payable monthly.
It’s the most important innovation in social policy in a generation.
The Canada Child Benefit provides a maximum annual amount of up to $6400 per child under the age of six, and up to $5400 per child between the ages of six and 17. These maximum amounts are paid to families with less than $30,000 in net income. The benefit tapers down at higher incomes. For the future, benefits will be indexed to preserve their buying-power against inflation.
Nine-out-of-ten families are now receiving more in tax-free CCB cash every month than they would have received under all the fragmented Harper programs combined. Family sizes and ages vary dramatically, but the average annual CCB benefit is about $6800 per family, and that’s an improvement of about $2300 on average compared to what was there previously.
Most importantly, the Canada Child Benefit is lifting some 300,000 kids out of poverty.
In addition to the important social objective of supporting families raising children, the CCB (like our middle-class tax cut) also helps drive economic growth by increasing disposable incomes and consumer demand. While statistics are still being collected and verified, the impact is very significant.
In my riding of Regina-Wascana alone, the Canada Child Benefit is helping an estimated 7,500 families, including more than 13,000 kids. Together, they receive more than $50-million per year. Across the entire province of Saskatchewan, the CCB is injecting close to a billion dollars annually in family incomes and spending power. Nationally, the total is more than $23-billion every year.
This is what transformational change looks like. It’s happening right now, every month, all across Canada. And it’s helping to build stronger families and a better Canada.