Higher Child Benefits Needed To Counter Persistent Poverty
FOR IMMEDIATE RELEASE
July 4, 2003
HIGHER
CHILD BENEFITS NEEDED TO
COUNTER PERSISTENT POVERTY
Toronto - Increased investments in the Canada Child Tax Benefit are needed in order to substantially reduce child poverty, say researchers and advocates following the release of the 2002 National Child Benefit Progress Report (1). They argue that enhancement of child benefits combined with an end to the clawback of the National Child Benefit (NCB) from families on social assistance would go along way to bolster family income security in Canada.
"The slow success in reducing child and family poverty is a key lesson for the Canada Child Tax Benefit: we will get as much out of this program as we are willing to put in. Existing benefits are insufficient to bolster income security among poor families," said Laurel Rothman, Campaign 2000's National Coordinator.
The federal report does show the potential that substantial child income benefits can have in preventing and reducing poverty. According to the NCB Progress Report, child poverty has gradually declined between 1996 and 2000 (2). The report points to increased labour market participation, falling welfare caseloads and increases in the National Child benefit, as key reasons for the decline in poverty.
But researchers point out that irrespective of the measure that is used, no significant gains have been achieved since 1989, the year Parliament resolved to end child poverty.
According to Campaign 2000, 16.2% of all children, or more than 1.1 million children, remained in poverty in 2000. In the same year, two parent families with children actually fell deeper into poverty. These families would need an additional $10,032, on average, just to reach the poverty line. And despite some improvement, female lone-parent families would still require an additional $8,500 to reach the pre-tax LICO.
In its most recent budget, the federal government announced plans to gradually raise the Canada Child Tax Benefit to a maximum of $3,243 per child per year by 2007.
"It's encouraging that the government is scaling up its investment, but the commitment is far too slow and it doesn't help vulnerable families quickly enough," said Michael Goldberg, Social Planning and Research Council of BC. "The increases will help many people who are close to the poverty line; but a real commitment to significantly raise the living standards of all families and substantially reduce child poverty will require a maximum benefit of approximately $4,400 along with long-term investments in quality child care and affordable housing."
In addition, advocates point to the unfairness inherent in the NCB where the majority of provinces are clawing back this modest amount of NCB money from Canada's poorest families, even as welfare incomes have steadily declined over the past decade. The 2003 Federal Budget indicates that this practice should stop when the CCTB reaches $2,500 per child.
The clawback of the NCB from families on social assistance is justified by governments on the basis that increasing welfare benefits would make it less financially attractive for families to move to the labour market. With claims of promoting labour market attachment, provincial and territorial governments have reinvested NCB clawback dollars in programs targeted at the working poor.
"All governments need to take leadership to stem deepening poverty among families on social assistance. Instead of a race to the bottom, governments would do better to work collaboratively on a comprehensive anti-poverty strategy that includes improvements in minimum wages and welfare benefits, quality child care, affordable housing and increased child benefits," said Marcel Lauziere, President of the Canadian Council on Social Development.
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For more information contact:
Laurel Rothman, National
Coordinator of Campaign 2000 - 416-595-9230/228
Michael Goldberg, Social Planning & Research Council of BC - 604-718-7738
Lori Harrop at the Canadian Council on Social Development (613) 236-8977
Campaign 2000 is a diverse coalition of over 85 national, provincial and community organizations dedicated to eliminating child and family poverty in Canada. More information is available at www.campaign2000.ca
NOTES:
(1)
The Canada Child Tax Benefit is composed of two parts: a base benefit
received by about 80% of Canadian families, and a supplement, called the
National Child Benefit (NCB) Supplement, that is targeted to low-income
families. Effective July 2003, the NCB will provide a maximum of $1,463
for the first child, while the base benefit will provide a maximum of
$1,169 for the first child for a maximum total of $2,632.
(2) The 2002 Progress Report's shift to the post-tax LICO as a primary measure of low income presents child poverty in the most favourable light and fails to lend clarity to a general understanding of low income. It has become increasingly complicated to track changes in child poverty rates in Canada. Since November 2002, there have been 4 different child poverty rates reported for the year 2000: Campaign 2000's pre-tax LICO from SLID (16.5%); Census pre-tax LICO in May (18.4%); Market Basket Measure also in May (16.9%); and the NCB Progress Report's post-tax LICO in July (12.5%).
Page last updated July 4, 2003